Tag Archives: CHMSP

EXCLUSIVE U.S. blocks more than 1,000 solar shipments over Chinese slave labor concerns

Nov 11 (Reuters) – More than 1,000 shipments of solar energy components worth hundreds of millions of dollars have piled up at U.S. ports since June under a new law banning imports from China’s Xinjiang region over concerns about slave labor, according to federal customs officials and industry sources.

The level of seizures, which has not previously been reported, reflects how a policy intended to heap pressure on Beijing over its Uyghur detention camps in Xinjiang risks slowing the Biden administration’s efforts to decarbonize the U.S. power sector to fight climate change.

U.S. Customs and Border Protection has seized 1,053 shipments of solar energy equipment between June 21, when the Uyghur Forced Labor Protection Act went into effect, and Oct. 25, it told Reuters in response to a public records request, adding none of the shipments have yet been released.

The agency would not reveal the manufacturers or confirm details about the quantity of solar equipment in the shipments, citing federal law that protects confidential trade secrets.

Three industry sources with knowledge of the matter, however, told Reuters the detained products include panels and polysilicon cells likely amounting to up to 1 gigawatt of capacity and primarily made by three Chinese manufacturers – Longi Green Energy Technology Co Ltd (601012.SS), Trina Solar Co Ltd (688599.SS) and JinkoSolar Holding Co (JKS.N).

Combined, Longi, Trina and Jinko typically account for up to a third of U.S. panel supplies. But the companies have halted new shipments to the United States over concerns additional cargoes will also be detained, the industry sources said.

The sources asked not to be named because they were not authorized to speak publicly on the matter.

China denies abuses in Xinjiang. Beijing initially denied the existence of any detention camps, but then later admitted it had set up “vocational training centers” necessary to curb what it said was terrorism, separatism and religious radicalism in Xinjiang.

Chinese foreign ministry spokesperson Zhao Lijian told a regular news briefing on Friday that claims about the use of forced labor in Xinjiang were “the lie of the century fabricated by a small group of anti-China individuals” and would hinder the global response to climate change.

“The U.S. side should immediately stop the unreasonable suppression of China’s photovoltaic enterprises and release the seized solar panel components as fast as possible,” he said.

In an email, Jinko said it is working with CBP on documentation proving its supplies are not linked to forced labor and is “confident the shipments will be admitted.”

Longi and Trina did not respond to requests for comment.

The bottleneck is a challenge to U.S. solar development at a time the Biden administration is seeking to decarbonize the U.S. economy and implement the Inflation Reduction Act (IRA), a new law that encourages clean energy technologies to combat climate change.

Solar installations in the United States slowed by 23% in the third quarter, and nearly 23 gigawatts of solar projects are delayed, largely due to an inability to obtain panels, according to the American Clean Power Association trade group.

ACP urged the Biden administration to streamline the vetting process for imports.

“After more than four months of solar panels being reviewed under UFLPA, none have been rejected and instead they remain stuck in limbo with no end in sight,” it said in a statement.

The UFLPA essentially presumes that all goods from Xinjiang are made with forced labor and requires producers to show sourcing documentation of imported equipment back to the raw material to prove otherwise before imports can be cleared.

CBP would not comment on the length of the detainments or say when they might be released or rejected. “Ultimately, it is contingent upon how quickly an importer is able to submit sufficient documentation,” CBP spokesperson Rhonda Lawson said.

Longi, Trina and Jinko source most of their polysilicon from U.S. and European suppliers such as Hemlock Semiconductor, a Michigan-based joint venture between Corning Inc and Shin-Etsu Handotai Co Ltd, and Germany’s Wacker Chemie, the industry sources said.

A Wacker spokesperson would not comment on the U.S. detainments but said the company sources quartzite from suppliers in Norway, Spain and France.

“Our procurement strategy gives us every reason to be confident that the products used in our supply chain are made in a manner that respects human rights,” spokesperson Christof Bachmair said.

Hemlock said in a statement that it sources all metallurgical-grade silicon from suppliers using quartz mined in North and South America.

CBP has previously said that it had detained about 1,700 shipments worth $516.3 million under UFLPA through September but has never before detailed how many of those shipments contained solar equipment.

The EU has also proposed a ban on products from Xinjiang but has not implemented one.

Reporting by Nichola Groom; Additional reporting by Eduardo Baptista in Beijing and David Stanway in Shanghai; Editing by Richard Valdmanis, Lisa Shumaker, Lincoln Feast and David Evans

Our Standards: The Thomson Reuters Trust Principles.

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Biden awards $2.8 billion to boost U.S. minerals output for EV batteries

WASHINGTON, Oct 19 (Reuters) – The Biden administration said on Wednesday it is awarding $2.8 billion in grants to boost U.S. production of electric vehicle batteries and the minerals used to build them, part of a bid to wean the country off supplies from China.

Albemarle Corp (ALB.N) is among the 20 manufacturing and processing companies receiving U.S. Energy Department grants to domestically mine lithium, graphite and nickel, build the first large-scale U.S. lithium processing facility, construct facilities to build cathodes and other battery parts, and expand battery recycling.

The grants, which are going to projects across at least 12 states, mark the latest push by the Biden administration to help reduce the country’s dependence on China and other nations for the building blocks of the green energy revolution.

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“As the world transitions from a fossil fuel to a clean energy powered economy, we cannot trade dependence on oil from autocrats like (Russian President Vladimir) Putin to dependence on critical minerals from China,” said a senior administration official briefing reporters on the program.

The funding recipients, first reported by Reuters, were chosen by a White House steering committee and coordinated by the Department of Energy with support from the Interior Department.

The funds are being doled out to a range of companies, some of which could self-fund projects and others that will see the grants as a financial lifeline to further expand their U.S. plans. The funding, though, does nothing to alleviate permitting challenges faced by some in the mining industry.

Albemarle is set to receive $149.7 million to build a facility in North Carolina to lightly process rock containing lithium from a mine it is trying to reopen. That facility would then feed a separate plant somewhere in the U.S. Southeast that the company said in June would produce as much lithium for EV batteries as the entire company produces today.

Albemarle, which also produces lithium in Australia and Chile, said the grant “increases the speed of lithium processing and reduces greenhouse gas emissions from long-distance transportation of raw minerals.”

Piedmont Lithium Inc (PLL.O) is receiving $141.7 million to build its own lithium processing facility in Tennessee, where the company will initially process the metal sourced from Quebec and Ghana. Piedmont’s plans to build a lithium mine in North Carolina have faced strong opposition.

Shares of Piedmont rose 7.5% after Reuters broke the news of its funding award earlier on Wednesday. Piedmont did not immediately respond to a request for comment.

Talon Metals Corp (TLO.TO) will receive $114.8 million to build a processing plant in North Dakota in a strategy shift for the company, which has a nickel supply deal with Tesla Inc (TSLA.O). Talon now aims to extract rock from its planned underground mine in Minnesota and ship it to a North Dakota processing facility that will be funded in part by the grant.

Talon said the grants are “a clear recognition that production of domestic nickel and other battery minerals is a national priority.”

Other grants include $316.2 million to privately-held Ascend Elements to build a battery parts plant, $50 million to privately-held Lilac Solutions Inc for a demonstration plant for so-called direct lithium extraction technologies, $75 million to privately-held Cirba Solutions to expand an Ohio battery recycling plant, and $219.8 million to Syrah Technologies LLC, a subsidiary of Syrah Resources Ltd (SYR.AX), to expand a graphite processing plant in Louisiana.

BIDEN’S GOAL

By 2030, President Joe Biden wants 50% of all new vehicles sold in the United States to be electric or plug-in hybrid electric models along with 500,000 new EV charging stations. He has not endorsed the phasing-out of new gasoline-powered vehicle sales by 2030.

Legislation Biden signed in August sets new strict battery component and sourcing requirements for $7,500 consumer EV tax credits. A separate $1 trillion infrastructure law signed in November 2021 allocates $7 billion to ensure U.S. manufacturers can access critical minerals and other necessary components to manufacture the batteries. The announcement on Wednesday was linked to that 2021 legislation.

The White House said in a fact sheet that the United States and allies do not produce enough of the critical minerals and materials used in EV batteries.

“China currently controls much of the critical mineral supply chain and the lack of mining, processing, and recycling capacity in the U.S. could hinder electric vehicle development and adoption, leaving the U.S. dependent on unreliable foreign supply chains,” the White House said.

In March, Biden invoked the Defense Production Act to support the production and processing of minerals and materials used for EV batteries.

The White House is also launching an effort, dubbed the American Battery Material Initiative, to strengthen critical mineral supply chains as automakers race to expand U.S. electric vehicle and battery production.

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Reporting by David Shepardson in Washington and Ernest Scheyder in Houston; Additional reporting by Nandita Bose; Editing by Bernadette Baum, Matthew Lewis and Paul Simao

Our Standards: The Thomson Reuters Trust Principles.

Ernest Scheyder

Thomson Reuters

Covers the future of energy and transportation including electric vehicle and battery technology, with a focus on lithium, copper, cobalt, rare earths and other minerals, politics, policy, etc. Previously covered the oil and natural gas, including a stint living in North Dakota’s Bakken shale oil patch.

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Nobel prize goes to pioneers of Lego-like “click chemistry”

  • Danish winner Meldal says click-chemistry like Lego
  • Technology has been used for targeting cancer treatment
  • Prize worth more than $900,000

STOCKHOLM, Oct 5 (Reuters) – Scientists Carolyn Bertozzi, Morten Meldal and Barry Sharpless won the 2022 Nobel Prize in Chemistry on Wednesday for discovering reactions that let molecules snap together to create new compounds and that offer insight into cell biology.

The field of click chemistry and bioorthogonal chemistry has been harnessed to improve the targeting of cancer pharmaceuticals now being tested in clinical trials, along with a host of health, agricultural and industrial applications.

“Combining simple chemical building blocks makes it possible to create an almost endless variety of molecules,” the award-giving body said in a statement, adding that “sometimes simple answers are the best”.

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Danish winner Medal described click chemistry as a way to build complex structures and link them as if they were pieces of Lego, the plastic construction toy.

The technology is employed globally to learn more about cells and track biological processes. It also allows assembly in the lab of stable molecules without creating undesirable by-products that had hobbled older methods.

Sharpless joins an elite band of scientists who have won two Nobel prizes. The other individuals are John Bardeen who won the Physics prize twice, Marie Curie, who won Physics and Chemistry, Linus Pauling who won Chemistry and Peace and Frederick Sanger who won the Chemistry prize twice.

“I’m absolutely stunned, I’m sitting here and I can hardly breathe,” Bertozzi said from California after the academy reached her by telephone with the news she had won.

She added that as part of her work, she and her team managed to visualize and understand cell surface structures known as glycans, leading to a new idea in cancer immune therapy.

The academy said the laureates’ discoveries had been used far beyond oncology, enabling products such as antimicrobials, herbicides, diagnostic tests, corrosion retardants and brightening agents.

Bertozzi works at Stanford University, Sharpless works at the Scripps Research institute, both in California, while Meldal is at the University of Copenhagen, Denmark.

Meldal told Reuters his legs and body started shaking with excitement when the Nobel committee called.

“It is not every day to have a Dane get the Nobel Prize,” he said, adding he had been recording a teaching video when he received the news and that he was very proud on behalf of his colleagues and team.

The third of the prizes unveiled over six consecutive weekdays, the chemistry Nobel follows those for medicine and physics announced earlier this week.

The 2021 chemistry award was won by German Benjamin List and Scottish-born David MacMillan for their work in creating new tools to build molecules, aiding in the development of new drugs as well as in areas such as plastics.

The prizes for achievements in science, literature and peace were established in the will of Swedish dynamite inventor and businessman Alfred Nobel, himself a chemist, and have been awarded since 1901. Economics was added later.

The prizes have been awarded every year with a few interruptions, primarily for the world wars, and made no break for the COVID-19 pandemic though much of the pageantry and events were put on hold or temporarily moved online.

($1 = 10.9281 Swedish crowns)

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Reporting by Niklas Pollard, Simon Johnson and Johan Ahlander in Stockholm, and Ludwig Burger in Frankfurt; additional reporting by Terje Solsvik in Oslo, Anna Ringstrom in Stockholm and Marie Mannes in Gdansk; editing by Frank Jack Daniel

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Marie Mannes

Thomson Reuters

Gdansk-based reporter covering the nordic stock markets and general business news.

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Exclusive: Brands blast Twitter for ads next to child pornography accounts

Sept 28 (Reuters) – Some major advertisers including Dyson, Mazda, Forbes and PBS Kids have suspended their marketing campaigns or removed their ads from parts of Twitter because their promotions appeared alongside tweets soliciting child pornography, the companies told Reuters.

DIRECTV and Thoughtworks also told Reuters late on Wednesday they have paused their advertising on Twitter.

Brands ranging from Walt Disney Co (DIS.N), NBCUniversal (CMCSA.O) and Coca-Cola Co (KO.N) to a children’s hospital were among more than 30 advertisers that appeared on the profile pages of Twitter accounts peddling links to the exploitative material, according to a Reuters review of accounts identified in new research about child sex abuse online from cybersecurity group Ghost Data.

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Some of tweets include key words related to “rape” and “teens,” and appeared alongside promoted tweets from corporate advertisers, the Reuters review found. In one example, a promoted tweet for shoe and accessories brand Cole Haan appeared next to a tweet in which a user said they were “trading teen/child” content.

“We’re horrified,” David Maddocks, brand president at Cole Haan, told Reuters after being notified that the company’s ads appeared alongside such tweets. “Either Twitter is going to fix this, or we’ll fix it by any means we can, which includes not buying Twitter ads.”

In another example, a user tweeted searching for content of “Yung girls ONLY, NO Boys,” which was immediately followed by a promoted tweet for Texas-based Scottish Rite Children’s Hospital. Scottish Rite did not return multiple requests for comment.

In a statement, Twitter spokesperson Celeste Carswell said the company “has zero tolerance for child sexual exploitation” and is investing more resources dedicated to child safety, including hiring for new positions to write policy and implement solutions.

She added that Twitter is working closely with its advertising clients and partners to investigate and take steps to prevent the situation from happening again.

Twitter’s challenges in identifying child abuse content were first reported in an investigation by tech news site The Verge in late August. The emerging pushback from advertisers that are critical to Twitter’s revenue stream is reported here by Reuters for the first time.

Like all social media platforms, Twitter bans depictions of child sexual exploitation, which are illegal in most countries. But it permits adult content generally and is home to a thriving exchange of pornographic imagery, which comprises about 13% of all content on Twitter, according to an internal company document seen by Reuters.

Twitter declined to comment on the volume of adult content on the platform.

Ghost Data identified the more than 500 accounts that openly shared or requested child sexual abuse material over a 20-day period this month. Twitter failed to remove more than 70% of the accounts during the study period, according to the group, which shared the findings exclusively with Reuters.

Reuters could not independently confirm the accuracy of Ghost Data’s finding in full, but reviewed dozens of accounts that remained online and were soliciting materials for “13+” and “young looking nudes.”

After Reuters shared a sample of 20 accounts with Twitter last Thursday, the company removed about 300 additional accounts from the network, but more than 100 others still remained on the site the following day, according to Ghost Data and a Reuters review.

Reuters then on Monday shared the full list of more than 500 accounts after it was furnished by Ghost Data, which Twitter reviewed and permanently suspended for violating its rules, said Twitter’s Carswell on Tuesday.

In an email to advertisers on Wednesday morning, ahead of the publication of this story, Twitter said it “discovered that ads were running within Profiles that were involved with publicly selling or soliciting child sexual abuse material.”

Andrea Stroppa, the founder of Ghost Data, said the study was an attempt to assess Twitter’s ability to remove the material. He said he personally funded the research after receiving a tip about the topic.

Twitter’s transparency reports on its website show it suspended more than 1 million accounts last year for child sexual exploitation.

It made about 87,000 reports to the National Center for Missing and Exploited Children, a government-funded non-profit that facilitates information sharing with law enforcement, according to that organization’s annual report.

“Twitter needs to fix this problem ASAP, and until they do, we are going to cease any further paid activity on Twitter,” said a spokesperson for Forbes.

“There is no place for this type of content online,” a spokesperson for carmaker Mazda USA said in a statement to Reuters, adding that in response, the company is now prohibiting its ads from appearing on Twitter profile pages.

A Disney spokesperson called the content “reprehensible” and said they are “doubling-down on our efforts to ensure that the digital platforms on which we advertise, and the media buyers we use, strengthen their efforts to prevent such errors from recurring.”

A spokesperson for Coca-Cola, which had a promoted tweet appear on an account tracked by the researchers, said it did not condone the material being associated with its brand and said “any breach of these standards is unacceptable and taken very seriously.”

NBCUniversal said it has asked Twitter to remove the ads associated with the inappropriate content.

CODE WORDS

Twitter is hardly alone in grappling with moderation failures related to child safety online. Child welfare advocates say the number of known child sexual abuse images has soared from thousands to tens of millions in recent years, as predators have used social networks including Meta’s Facebook and Instagram to groom victims and exchange explicit images.

For the accounts identified by Ghost Data, nearly all the traders of child sexual abuse material marketed the materials on Twitter, then instructed buyers to reach them on messaging services such as Discord and Telegram in order to complete payment and receive the files, which were stored on cloud storage services like New Zealand-based Mega and U.S.-based Dropbox, according to the group’s report.

A Discord spokesperson said the company had banned one server and one user for violating its rules against sharing links or content that sexualize children.

Mega said a link referenced in the Ghost Data report was created in early August and soon after deleted by the user, which it declined to identify. Mega said it permanently closed the user’s account two days later.

Dropbox and Telegram said they use a variety of tools to moderate content but did not provide additional detail on how they would respond to the report.

Still the reaction from advertisers poses a risk to Twitter’s business, which earns more than 90% of its revenue by selling digital advertising placements to brands seeking to market products to the service’s 237 million daily active users.

Twitter is also battling in court Tesla CEO and billionaire Elon Musk, who is attempting to back out of a $44 billion deal to buy the social media company over complaints about the prevalence of spam accounts and its impact on the business.

A team of Twitter employees concluded in a report dated February 2021 that the company needed more investment to identify and remove child exploitation material at scale, noting the company had a backlog of cases to review for possible reporting to law enforcement.

“While the amount of (child sexual exploitation content) has grown exponentially, Twitter’s investment in technologies to detect and manage the growth has not,” according to the report, which was prepared by an internal team to provide an overview about the state of child exploitation material on Twitter and receive legal advice on the proposed strategies.

“Recent reports about Twitter provide an outdated, moment in time glance at just one aspect of our work in this space, and is not an accurate reflection of where we are today,” Carswell said.

The traffickers often use code words such as “cp” for child pornography and are “intentionally as vague as possible,” to avoid detection, according to the internal documents. The more that Twitter cracks down on certain keywords, the more that users are nudged to use obfuscated text, which “tend to be harder for (Twitter) to automate against,” the documents said.

Ghost Data’s Stroppa said that such tricks would complicate efforts to hunt down the materials, but noted that his small team of five researchers and no access to Twitter’s internal resources was able to find hundreds of accounts within 20 days.

Twitter did not respond to a request for further comment.

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Reporting by Sheila Dang in New York and Katie Paul in Palo Alto; Additional reporting by Dawn Chmielewski in Los Angeles; Editing by Kenneth Li and Edward Tobin

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Indian billionaire Adani seeks to control NDTV; media group says move without consent

  • India’s richest man, Adani, seeks to expand media business
  • NDTV says Adani unit moved without its consent
  • Adani takeover may not be friendly -legal expert
  • Deal to buy NDTV could heat up competition among billionaires

BENGALURU, Aug 23 (Reuters) – Indian billionaire Gautam Adani’s conglomerate on Tuesday said it seeks to control a majority stake in the popular New Delhi Television (NDTV.NS) (NDTV), a move the TV news group said was executed without its consent.

A unit of the Adani Group said it had used financial rights in a bid to purchase a 29.18% stake in NDTV, laying out plans for a subsequent open offer for a stake of another 26% in line with Indian regulations.

Hours after the announcement, NDTV issued a statement saying the move by the Adani Group “was executed without any input from, conversation with, or consent of the NDTV founders.”

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One of the nation’s most popular news organisations, NDTV is regarded as one of the few media groups that often takes a critical view of the ruling administration’s policies. It operates three national channels: NDTV 24×7 in English, NDTV India in Hindi and a business news channel. read more

“From NDTV’s statements, it seems this may not be a friendly takeover which generally is as per agreed terms and mechanism, and in fact, may end up being a hostile takeover,” said Dipti Lavya Swain, founder and managing partner, DLS Law Offices. He is not connected to the situation.

Adani Group did not immediately respond to a request for comment on NDTV’s statement.

While Adani did not disclose financial details of the group’s planned 29.18% stake purchase, it said its subsequent open offer would be for 294 Indian rupees ($3.68) per NDTV share, which would be worth 4.93 billion rupees.

That open offer price is at a 20.5% discount to NDTV’s Tuesday’s close of 369.75 rupees.

NDTV was founded by one of India’s most famous TV news personalities, Prannoy Roy, and his wife in 1988. Other than TV news channels, the group also runs online news websites.

On Monday, NDTV said in a stock exchange disclosure that Radhika and Prannoy Roy were not in discussions with any entity for a change in ownership or a divestment of their stake in NDTV.

They individually and through their company continue to hold 61.45% of NDTV, the statement said.

BATTLE OF BILLIONAIRES

In March, Adani, who is Asia’s richest man, made his first bet in the media sector by taking a minority stake in local digital business news platform Quintillion. But the proposed NDTV transaction marks Adani’s highest-profile media bet to date.

“NDTV is the most suitable broadcast and digital platform to deliver on our vision,” Adani Group executive Sanjay Pugalia said in the statement.

The move could set the stage for Adani to face off in the sector with fellow tycoon Mukesh Ambani.

Ambani, chairman of oil-to-telecom conglomerate Reliance Industries (RELI.NS), controls Network18 (NEFI.NS) which runs business channels including CNBC TV18.

Adani Group has several publicly listed companies in sectors including airports and ports, power generation and transmission, coal and gas trading.

India’s TV news industry is worth $351 million, Elara Capital said in a note, adding that 70% of this market was dominated by Hindi news. Other than Ambani, the other big player is Times Group which runs many news channels and newspapers.

Elara Capital said Adani’s planned bid to control NDTV was at “very premium valuations” but added “this move will enable a large corporate house backing for a news channel.”

Adani Group said NDTV had recorded a revenue of 4.21 billion rupees and a net profit of 850 million rupees in the fiscal year that ended in March 2022, with negligible debt.

Fitch Group’s debt research unit CreditSights on Tuesday published a report that said Adani Group is “deeply overleveraged” and that its many investments in capital-intensive businesses could pose long-term risks to investors. read more

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Reporting by Nallur Sethuraman, Chris Thomas in Bengaluru and M. Sriram and Shilpa Jamkhandikar in Mumbai
Writing by Sudarshan Varadhan and Aditya Kalra
Editing by Krishna Chandra Eluri, Mike Harrison and Matthew Lewis

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Elon Musk says Tesla open to buying a mining company

May 10 (Reuters) – Tesla Inc (TSLA.O) is open to buying a mining company if producing its own supply of electric vehicle (EV) metals would speed up worldwide adoption of clean energy technologies, Chief Executive Officer Elon Musk said on Tuesday.

Concern is mounting across the EV industry that there may not be enough supply of lithium, nickel, copper and other metals to match demand later this decade, fueling questions about whether Tesla would consider jumping into the mining sector.

“It’s not out of the question,” Musk told the FT Future of the Car 2022 conference. “We will address whatever limitations are on accelerating the world’s transition to sustainable energy. It’s not that we wish to buy mining companies, but if that’s the only way to accelerate the transition, then we will do that.”

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While the auto giant has EV metals contracts with suppliers across the globe, its goal to produce 20 million vehicles annually by 2030 – what Musk called an “aspiration, not a promise” – will require vastly more supplies of metals. Tesla produced just under 1 million EVs last year.

Other automakers and executives including Carlos Tavares, the CEO of Tesla rival Stellantis NV (STLA.MI), have warned the auto industry faces a metals supply shortage.

Tesla has no experience with the time-intensive and laborious task of building and operating a mine, so industry analysts have advised the automaker to focus on buying an existing operator.

Many in the mining industry have noted that buying an existing metals producer would cost far less than the $43 billion Musk offered to personally buy social media network Twitter Inc (TWTR.N)earlier this year.

Tesla has lithium supply deals with Ganfeng Lithium Co (002460.SZ), Livent Corp (LTHM.N)and Albemarle Corp(ALB.N), among others. The company’s lithium supply deal with Piedmont Lithium Inc (PLL.O) was put on hold last year.

Tesla has nickel supply deals with ValeSA (VALE3.SA) and Talon Metals Corp(TLO.TO).

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Reporting by Ernest Scheyder; additional reporting by Eva Matthews, Bernard Orr

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COVID-19 outbreak prompts shutdowns in Chinese manufacturing hub

People wearing face masks following the coronavirus disease (COVID-19) outbreak walk on a street in Shanghai, China, December 14, 2021. REUTERS/Aly Song

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SHANGHAI, Dec 14 (Reuters) – Multiple companies have suspended operations in one of China’s biggest manufacturing hubs as local authorities try to contain a COVID-19 outbreak, halting production of goods from batteries to textile dyes and plastics.

At least 20 listed companies have shut operations in virus-hit areas in Zhejiang, an eastern province with a large industrial sector that accounts for around 6% of China’s GDP and where many goods are manufactured for export.

Tens of thousands of Zhejiang residents are in quarantine and some domestic flights have been suspended as a national health official said the outbreak in three cities – Ningbo, Shaoxing and Hangzhou – was developing at a “relatively rapid” speed. read more

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The three cities accounted for more than 50% of the province’s economic output of around 6.46 trillion yuan ($1.02 trillion) last year.

Zhejiang reported 44 locally transmitted cases with confirmed symptoms on Dec. 13, official data showed on Tuesday, taking the total to 217 just over a week since the first case was reported on Dec. 6. Prior to the current outbreak, the province had reported just one local case this year.

Companies reporting suspended production on Tuesday included Zhejiang Mustang Battery Co (605378.SS), Guobang Pharma Ltd (605507.SS) and textile dyes maker Zhejiang Runtu Co (002440.SZ).

Ningo-based Mustang Battery said it expected the outbreak to be brought under control very soon, and the production suspension was a temporary measure that “will not have a long-term negative impact on the company’s growth.”

Zhejiang Runtu said all its units in the Zhejiang Shangyu Economic Development Zone (SEDZ), which accounts for 95% of its revenue, had been halted since Dec. 9 and it expected a negative impact on its fourth quarter results.

There are more than 350 industrial enterprises in the zone, which is located near the cities of Ningbo, Hangzhou, Shanghai, Suzhou and Wenzhou.

Ningbo Homelink Eco-Itech Co (301193.SZ), Zhejiang Zhongxin Fluoride Materials Co (002915.SZ), Zhejiang Jingsheng Mechanical & Electrical Co (300316.SZ) and Zhejiang Fenglong Electric Co (002931.SZ) have also suspended work in affected areas.

The companies said they halted operations in line with local government orders in Zhenhai district in Ningbo and Shangyu district in Shaoxing, which curtailed all production bar essential manufacturing.

The orders cover all companies in the affected areas, but only listed firms are required to disclose any impact on their business.

Major industries in Zhenhai, which has a port, include manufacturing of precision machinery and chemicals. The district also hosts factories with investments by more than 700 foreign companies including LG Electronics Inc (066570.KS) and Toshiba Corp (6502.T), according to the Zhenhai government’s website.

Sinopec’s (600028.SS) Zhenhai Refining and Chemicals, the biggest oil refinery in China, said on Tuesday it was maintaining a high operational rate despite tightened COVID measures. The refinery, which has annual crude oil refining capacity of 460,000 barrels-per-day, is currently processing 60,000 tonnes of crude oil each day, the company said in statement.

More than 50,000 people have been quarantined at centralised facilities across the coastal province of 64.4 million, while a further nearly half a million people were being monitored.

($1 = 6.3631 yuan)

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Reporting by Samuel Shen and Andrew Galbraith, additional reporting by Roxanne Liu; Editing by Jane Wardell

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