Coal cargoes will arrive this month, followed by crude oil in May
Russian coal and oil paid for in yuan is about to start flowing into China, Bloomberg reported on Thursday.
According to the media outlet, citing Chinese consultancy Fenwei Energy Information Service, several Chinese firms used local currency to buy Russian coal in March, and the first cargoes will arrive this month.
These will be the first commodity shipments paid for in yuan since the United States and Europe hit Moscow with unprecedented sanctions, cutting several Russian banks off from the international financial system.
Traders said that Russian crude sellers have also offered Chinese buyers the flexibility to pay in yuan. The first cargoes of the ESPO grade bought with Chinese currency will be delivered to independent refiners in May, people familiar with the purchases told Bloomberg.
According Fenwei, both steel-making and power-plant coal are being paid for in renminbi. These deals are traditionally made in dollars, but many Chinese buyers temporarily halted purchases after Washington and its allies cut off Russian lenders from SWIFT.
Data shows that Russia was China’s second-largest coal supplier last year. Nearly half of the imports from Russia are metallurgical coal.
Chinese buyers are interested in importing more Russian supplies. However, logistics and financing barriers could ultimately cap the flows, the China Coal Transport and Distribution Association said last month.
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5 comments:
Death of EU:
'Europe has chosen its fate. And chose fate for Russia. What you are seeing now is the death of Europe. Even if it does not come to nuclear strikes on industrial centers, Europe is doomed. In a situation where European industry is left without cheap Russian energy sources and raw materials – and China will begin to receive these same energy carriers and raw materials at a discount, there can be no talk of any real competition with China from Europe. As a result, literally everything will collapse there – after industry, agriculture will collapse, welfare and social security will collapse, hunger, banditry and chaos will begin.”
http://thesaker.is/the-total-war-to-cancel-russia/
https://www.zerohedge.com/geopolitical/commodity-currency-revolution-begins
The Commodity-Currency Revolution Begins...
'The West, by which we mean America, the EU, Britain, Japan, South Korea, and a few others have set themselves up to be the fall guys. That statement barely describes the strategic stupidity — an Ignoble Award is closer to the truth. By phasing out fossil fuels before they could be replaced entirely with green energy sources, an enormous shortfall in energy supplies has arisen. With an almost religious zeal, Germany has been cutting out nuclear generation. And even as recently as last month it still ruled out extending the lifespan of its nuclear facilities. The entire G7 membership were not only unprepared for Russia turning the tables on its members, but so far, they have yet to come up with an adequate response.'
Japan, the lame duck without backbone, is still strutting it's stuff by wanting to hold military exercises with the Philippines. And openly declaring that this is to counter China. China must be shivering in it's pants.
In Europe we have the insignificant Little Britain, with it's leader Boris Johnson, completely sidelined and ignored by other leaders at the G7 meeting, is still shamelessly strutting his stuff about sending armored vehicles to Ukraine, when the UK itself is in deep shit with inflation in double digit figures. Rather then scrapping those obsolete out of date vehicles for a little scrap metal money, he is trying to salvage a little of what is left of his tiny prestige. He does not even know that Little Britain has totally lost it's empire long ago, with only an island and a half to boast about. Soon it will be called Tiny Britain.
Huge Increase in Russians Ditching Dollars and Euros for Yuan - RT
Russian banks saw a sharp increase in the number of Chinese yuan accounts last month, a survey by financial daily Kommersant has found.
According to the publication, Russian citizens were actively converting their forex savings to the Chinese currency, while the number of new accounts denominated in yuan also grew significantly.
At Tinkoff Bank, for instance, the volume of funds held in yuan has surged eight times. MTS Bank reported a four-fold increase, as did the Ural Bank for Reconstruction and Development, while Bank Saint Petersburg saw a 3.5-fold rise.
Tinkoff Bank also reported that many wholesale companies were switching to settlement in yuan, whereas previously they considered US dollar settlements to be easier and faster. According to the bank’s data, the share of business settlements in yuan has grown from 15-25% last year to 25-30% now. The transactions involve firms trading in goods such as spare parts, peripheral equipment, textiles and food products, MTS Bank stated, noting that Russian oil firms, coal miners and metal producers were also starting to move to yuan settlement.
Transactions with the Chinese currency on the Moscow Exchange have also grown significantly, although they still lag dollar and euro volumes. Whereas in January-February the volume of yuan transactions on the exchange rarely exceeded 3 billion rubles per day (some $37 million), this past week an all-time record of 18.5 billion rubles (some $230 million) changed hands.
Analysts see this as a means for both individuals and companies to evade Ukraine-related Western sanctions that effectively limit Russia’s access to the dollar and euro. China, however, has not joined the sanctions and has kept access to its national currency open, which makes it a potential alternative for Russia’s international transactions.
“Under the conditions of restrictions, many companies see settlements in yuan as more stable and predictable,” MTS Bank told the newspaper. Analysts say that as sanctions force Russian importers and producers to reorient to Asia, and as the dollar and euro are increasingly seen as unreliable for Russian companies, the number of settlements in yuan is likely to grow further.
BRICS States Creating SWIFT-like System and Ratings Agency to Counter US
Ukraine-related Western sanctions are pushing BRICS countries into closer economic cooperation at an accelerated pace, Russian Finance Minister Anton Siluanov said on Saturday during the first meeting of finance ministers and central bank governors of the BRICS countries, chaired by China.
According to the finance minister, the “current crisis is man-made,” and the BRICS member states – Russia, Brazil, India, China, and South Africa – “have all the necessary tools to mitigate its consequences for their respective economies and the global economy on a broader scale.”
Siluanov says the current US dollar-based international financial system should be reformed to ensure “independence and continuity of economic processes.”
“The situation in the global economy has deteriorated significantly as a result of the sanctions. Bans on settlements, disruption of production and supply chains, export controls and import bans – all of these restrictions hit the global economy.”
In order to prevent economies from plunging into crisis, BRICS countries are working to reform their financial interaction, for instance, by creating a BRICS-based interbank messaging system, an analogue of SWIFT, which Russia was cut off from last month as part of EU sanctions, and other measures.
“This pushes us to the need to speed up work in the following areas: The use of national currencies for export-import transactions, the integration of payment systems and cards, our own financial messaging system and the creation of an independent BRICS rating agency,” Siluanov said.
The prospect of creating a BRICS-focused rating agency, for instance, is a highly positive idea, analysts say, as major ratings agencies Moody’s, Fitch, and S&P recently removed their Russia ratings due to sanctions pressure, which makes it difficult for Moscow to secure foreign investment.
During their meeting, representatives of the BRICS countries also discussed cooperation through the New Development Bank, investment in infrastructure, and the creation of a BRICS research network. The central banks of the nations agreed to conduct a new test of the BRICS Contingent Reserve Pool mechanism, which allows member states to swap national currencies in times of need.
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