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Bank Lending To Emerging Markets Soars To Record
http://www.ft.com/cms/s/0/20802e26-1e12-11e3-a40b-00144feab7de.html#ixzz2f3VWpQSH By Claire Jones, Economics Reporter Banks piled into emerging markets at a record pace earlier this year, highlighting the scale of the global search for yield that has partially reversed since the US Federal Reserve said it intended to slow its bond buying. Cross-border lending to emerging markets surged by $267bn, to an estimated $3.4tn, in the first quarter of 2013, the Bank for International Settlements said on Sunday. The BIS said the 8.4 per cent increase was by far the highest recorded, with the amount of interbank lending rising by almost $200bn, or 12 per cent. The so-called central bankers’ bank, which compiles what are widely regarded as the most comprehensive set of statistics on cross-border capital flows, said in its latest Quarterly Review that 85 per cent of the rise was accounted for by more lending to China, Brazil and Russia. The publication of the figures comes as the US Federal Open Market Committee gears up for its policy meeting, ending on Wednesday, when it could decide the timing and pace at which it will slow its $85bn worth of monthly bond purchases. With interest rates close to zero across advanced economies and liquidity abundant as a result of their central banks’ mass bond-buying sprees, credit has flowed into emerging markets in recent years as lenders and investors sought higher returns. According to the BIS data, interbank lending to emerging markets in the Asia-Pacific region alone has doubled since the investment bank Lehman Brothers collapsed five years ago. Lending to emerging markets has shown signs of retrenchment since Ben Bernanke, chairman of the Fed, signalled in May that the US central bank had begun to consider unwinding its exceptional monetary stimulus. The expectation of a return to higher interest rates in advanced economies in the years ahead has led to a retreat – particularly from emerging markets with large current account deficits such as India – although the pace of that retrenchment has slowed in recent weeks. According to the BIS data, the record rise in cross-border lending to emerging markets in the first quarter mainly reflected buoyant interbank lending, while cross-border credit that was extended to borrowers in China rose by $160bn, or 31 per cent. With international demand for Chinese assets growing, companies in the world’s second-largest economy can borrow at cheaper rates from lenders abroad and are reliant on banks headquartered off the mainland for foreign-currency loans to help fund their expansion overseas. The BIS data showed emerging market companies were also increasingly turning to debt markets in offshore financial centres such as Hong Kong to secure funds. Chinese businesses’ borrowing through offshore financial centres has soared from less than $1bn between 2001 and 2002 to $51bn in the 12 months to June. Of these bonds, 16 per cent is denominated in renminbi, with most of the rest – 77 per cent – in dollars. Though there are restrictions on bringing capital into China, businesses apply for permission to bring funds borrowed abroad into the domestic market. Overseas lending to Brazil expanded by 14 per cent, or $34bn; for Russia, the figure was $29bn, an 18 per cent rise. Both were the largest quarterly increases on record. Euro area banks increased their lending to emerging markets for the first time since the second quarter of 2011. Lenders in France, the Netherlands, Germany and Luxembourg accounted for most of the growth. In contrast to the rapid rise in lending to emerging markets, cross-border claims on banks in the advanced economies slipped by $341bn, or 1.5 per cent. Though bank lending to emerging markets could remain strong as long as growth remains so, the end of quantitative easing and an eventual rise in interest rates in advanced economies are likely to slow the pace of cross-border flows. Additional reporting by Simon Rabinovitch. Continue reading
Cellulosic Leaders Talk Feedstock Procurement At Neb. Event
Taylor Scott International News Taylor Scott International Taylor Scott International, Taylor Scott Continue reading
USDA Announces Support For Producers Of Advanced Biofuel
Posted: Friday, September 13, 2013 2:33 pm | Updated: 2:33 pm, Fri Sep 13, 2013. OMAHA, Neb. — Agriculture Secretary Tom Vilsack announced Friday that the U.S. Department of Agriculture (USDA) is making payments to support the production of advanced biofuel. USDA is making nearly $15.5 million in payments to 188 producers through the Advanced Biofuel Payment Program. USDA Rural Development Acting Under Secretary Doug O’Brien made the announcement on Vilsack’s behalf in Omaha, Neb., at the National Advanced Biofuels Conference. USDA remains focused on carrying out its mission, despite a time of significant budget uncertainty. Today’s announcement is one part of the Department’s efforts to strengthen the rural economy. “Producing advanced biofuels is a major component of the drive to take control of America’s energy future by developing domestic, renewable energy sources,” O’Brien said. “These payments represent the Obama Administration’s commitment to support an ‘all-of-the-above’ energy strategy.” The funding is being provided through USDA’s Advanced Biofuel Payment Program, which was established in the 2008 Farm Bill. Under this program, payments are made to eligible producers based on the amount of advanced biofuels produced from renewable biomass, other than corn kernel starch. Examples of eligible feedstocks include but are not limited to: crop residue; animal, food and yard waste; vegetable oil; and animal fat. O’Brien noted that today’s announcement serves as another reminder of the importance of USDA programs for rural America and a reminder of the need for Congress to get a comprehensive Food, Farm and Jobs Bill done as soon as possible. “Job seekers in rural America need new and expanded investments in renewable energy, biofuel and bio-based product manufacturing, all of which can help create jobs in rural areas,” said O’Brien. Through the Advanced Biofuel Payment Program and other USDA programs, the department is working to support the research, investment and infrastructure necessary to build a strong biofuels industry that creates jobs and broadens the range of feedstocks used to produce renewable fuel. More than 290 producers in 47 states and territories have received $211 million in payments since the program’s inception. It has supported the production of more than 3 billion gallons of advanced biofuel and the equivalent of more than 36 billion kilowatt hours of electric energy. For example, Riverview, LLP, a Minnesota-based company, will be receiving an $8,040 payment to help offset the cost of producing electricity from two anaerobic digesters. The two digesters use manure from two of the company’s dairy operations to produce electricity, which is sold to Great River Energy. During the last quarter of 2012, the anaerobic digesters produced almost 4.9 million kilowatt hours of electricity, enough to power more than 400 homes a year. American Biodiesel, Inc. (dba Community Fuels) in Encinitas, Calif., is receiving a $47,186 payment for its quarterly production of biodiesel from a variety of sources, including canola and soybean oil. The biodiesel reduces emissions and is primarily used as an alternative to diesel fuel. In the past, Community Fuels has used funds from the Advanced Biofuel Payment Program to install equipment and increase production at its bio-refinery at the Port of Stockton, Calif. View the complete list of producers receiving payments here. President Obama’s plan for rural America has brought about historic investment and resulted in stronger rural communities. Under the President’s leadership, these investments in housing, community facilities, businesses and infrastructure have empowered rural America to continue leading the way, strengthening America’s economy, small towns and rural communities. USDA’s investments in rural communities support the rural way of life that stands as the backbone of our American values. President Obama and Agriculture Secretary Vilsack are committed to a smarter use of federal resources to foster sustainable economic prosperity and ensure the government is a strong partner for businesses, entrepreneurs and working families in rural communities. USDA, through its Rural Development mission area, has a portfolio of programs designed to improve the economic stability of rural communities, businesses, residents, farmers and ranchers and improve the quality of life in rural America. USDA has made a concerted effort to deliver results for the American people, even as the department implements sequestration, the across-the-board budget reductions mandated under terms of the Budget Control Act. USDA has already undertaken historic efforts since 2009 to save more than $828 million in taxpayer funds through targeted, common-sense budget reductions. These reductions have put USDA in a better position to carry out its mission, while implementing sequester budget reductions in a fair manner that causes as little disruption as possible. USDA is an equal opportunity provider and employer. To file a complaint of discrimination, write: USDA, Office of the Assistant Secretary for Civil Rights, Office of Adjudication, 1400 Independence Ave., SW, Washington, DC 20250-9410 or call (866) 632-9992 (Toll-free Customer Service), (800) 877-8339 (Local or Federal relay), (866) 377-8642 (Relay voice users). Continue reading
