Fossil Fuel Usage Needs to Fall 25% by 2030 to Achieve Net Zero, IEA Says — Commodities Roundup

–Gold futures edged down 0.3% to $1,930.10 a troy ounce.

–LME three-month copper futures weakened 0.4% to $8,120.50 a metric ton.

–Wheat futures rose 0.5% to $5.92 a bushel.

TOP STORY:

Fossil Fuel Usage Needs to Fall 25% by 2030 to Achieve Net Zero, IEA Says

Achieving net zero by 2050 remains a possibility, but significant cuts to fossil fuel usage and investment in clean energy technologies is going to be needed to make that a reality, according to the International Energy Agency.

In a new report, the IEA said that fossil fuel usage will need to fall by a quarter by 2030, with no new investments in fossil fuel projects, if the globe is to achieve carbon neutrality by 2050.

In 2023, clean energy investments are set to hit a record $1.8 trillion, but this will need to scale up to $4.5 trillion a year by the start of the 2030s to achieve net zero, it added.

“August 2023 was the hottest on record by a large margin, and the hottest month ever after July 2023,” the report said. “The impacts of climate change are increasingly frequent and severe, and scientific warnings about the dangers of the current pathway have become stronger than ever.”

OTHER STORIES:

Paine Schwartz Banks $1.7 Billion for Food-Chain Deals

Paine Schwartz Partners has raised its largest fund to date to invest in businesses in the food and agribusiness sectors.

The New York investment manager has collected $1.7 billion for its sixth fund, around 19% more than it brought in for a predecessor vehicle, which held almost $1.43 billion by the time fundraising wrapped up in 2019, according to a statement.

The firm had set $1.5 billion as the target for Paine Schwartz Food Chain Fund VI, according to the statement. About 40% of the fund’s capital has already been deployed into businesses such as AgroFresh Solutions, a technology provider focused on reducing food waste, and Costa Group, one of Australia’s largest fruit and vegetable growers, Paine Schwartz said.

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Saudis Agree to More U.N. Atomic Oversight

Saudi Arabia said Monday it would agree to far greater oversight of its nuclear activities, a step that could help advance negotiations with the U.S. to set up a uranium enrichment operation in the kingdom as part of a possible Washington-backed normalization agreement between Riyadh and Israel.

Speaking at the United Nations atomic agency’s annual General Conference, Saudi Energy Minister Prince Abdulaziz bin Salman said Riyadh would rescind its basic oversight agreement with the Agency and implement a Comprehensive Safeguards Agreement, which gives inspectors much broader powers to inspect nuclear activities.

MARKET TALKS:

Rio Tinto Looks on Track to Hit Top-End of Iron Ore Production Guidance

1041 GMT – Rio Tinto is one of the top producers of iron ore in September and looks firmly on track to meet full-year production guidance, UBS analysts write in a research note. The Anglo-Australian metals and mining giant should see iron-ore production from its Pilbara operations in Western Australia rise 3% on year this month–to 86 million metric tons–as weekly shipments have held up despite a recent halt to works, the analysts say, after Rio Tinto said an Indigenous rock shelter was damaged. Rio Tinto is on track to achieve the top end of its 2023 iron ore production guidance of 320 million to 335 million tons, they say. Shares are down 0.4% at 5,063.00 pence. ([email protected])

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Palm Oil Ends Lower, Tracking Soybean Oil

1012 GMT – Palm oil closed lower, tracking soybean oil’s losses overnight on the Chicago Board of Trade. The two oils often move in tandem as they are used in similar products. The market was “stagnant today, with little direction,” with futures dropping 30 points in the second half of the session says Sathia Varqa from Palm Oil Analytics. Higher prices from rising export demand is being offset by surging production, he adds, and he believes palm oil price is under valued and fresh positive data will be needed to see sustainable buying interest. The Malaysian Palm Oil Association has estimated that the country’s palm-oil production during Sept. 1-20 rose 12% on month. The Bursa Malaysia Derivatives contract for December delivery ended MYR25 lower at MYR3,691 a ton.([email protected])

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Oil Tumbles on Dollar Strength, Economy Worries

0746 GMT – Oil prices slip, with Brent on course for its sixth consecutive loss, as a strong dollar and concerns about the global economy weigh on prices. Brent crude, the international oil benchmark, declines 1.3% to $90.72 a barrel. WTI falls 1.3% to $88.49 a barrel. The dollar has climbed to its highest level since November 2022 in recent days and is dragging on dollar-denominated crude prices. Meanwhile, investors are fretting about the implications of the Federal Reserve’s higher-for-longer message on interest rates, which could crimp economic growth and with it oil demand. “Crude trades lower for a second day with macroeconomic concerns, a stronger dollar and a stretched speculative long and easing refinery margin weighing on prices,” says Saxo in a note. ([email protected])

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Metals Slip As Industrial Demand Remains Weak

0726 GMT – Metal prices are falling as weak demand in China, and an uncertain macroeconomic environment pressure industrial goods. Three-month copper is down 0.9% to $8,085 a metric ton while aluminum is 0.5% lower at $2,222 a ton. Gold meanwhile is 0.4% lower at $1,929.20 a troy ounce. Data from Worldsteel showed that crude steel output fell to 152.6 million tons in August from 158.5 million tons in July – the lowest level since February, ING said in a note. The bank also said that gold remains under pressure from the Federal Reserve’s “higher for longer” stance on interest rates. “U.S. 10Y treasury yields have increased to a fresh five-year high and broken above 4.5%, which continues to weigh on gold prices.” ([email protected])

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Palm Oil Falls, Tracking Soybean Oil Moves

0239 GMT – Palm oil prices decline in Asian trade, tracking soybean oil’s overnight weakness on the Chicago Board of Trade, PhillipCapital says in a note. The two vegetable oils often trade in tandem as they are used in similar products. Higher palm oil production estimates may also weigh on CPO prices, PhillipCapital adds. According to the Malaysian Palm Oil Association’s estimates, the country’s Sept. 1-20 CPO production was 12.4% higher on month. PhillipCapital pegs support for CPO futures at MYR3,681 and resistance at MYR3,910. The Bursa Malaysia Derivatives contract for December delivery is MYR11 lower at MYR3,705 a ton. ([email protected])

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