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Most global equity markets closed higher today, except for US
technology stocks, with the positive momentum that began during the
APAC trading session rapidly dropping off during the last hour of
trading in the US. US and European credit indices closed relatively
flat, while commodities closed higher on weakness in the US
dollar.
Americas
Most US equity markets closed higher, except for the Nasdaq
-0.8%; Russell 2000 +1.3%, DJIA +0.6%, and S&P 500 +0.2%.
Sentiment shifted to a more negative tone across US equities and
credit beginning around 3:00pm EST.
10yr US govt bonds closed -1bp/0.60% yield, which is the best
close since late-April. 5yr bonds reached an all-time low yield of
0.25% today before closing at -1bp/0.27% yield.
The DXY US Dollar index -0.7%/95.17 is currently at its lowest
point since 9 March.
CDX-NAIG closed flat/70bps and CDX-NAHY -5bps/458bps. The below
chart shows today's intraday changes in CDX spreads beginning at
the start of the US equity trading session:
Crude oil closed +2.4%/$41.92 per barrel, which is its best
close since 5 March.
Silver closed at +6.8%/$21.56 per ounce, which is its highest
close since October 2013.
Despite positive news of early recovery, looking at the
four-month compound annual growth rate from February to June shows
which state economies have fared the worst since the beginning of
the pandemic. States that were hit hardest included those that were
the epicenter of the coronavirus outbreak in the Northeast, such as
New York, New Jersey, Massachusetts, and Rhode Island. Tourism and
travel-reliant states such as Hawaii and Nevada, and heavily
goods-producing midwestern states such as Michigan, also sustained
heavy blows. All these states declined in employment at an annual
rate of at least 30% over the four-month period. As we expected,
the states that fared the best are smaller states with rural
geographies that naturally allowed for better social distancing,
such as Utah, Idaho, and Arizona. While some of these states
enjoyed less restrictive quarantine measures during the outbreak,
some also benefited the least from the recovery in June. (IHS
Markit Economist Steven Frable)
Aurora Innovation is expanding its testing and development of
commercial autonomous vehicles (AVs) to the US state of Texas,
according to a company announcement via a blog post on 20 July. The
announcement states that Aurora will add a fleet of Chrysler
Pacifica minivans and later Class 8 trucks, testing AVs on
commercial routes along key logistics delivery corridors in the US
state. Aurora also states that the fleets will be fully integrated
with the company's new FirstLight Lidar. Aurora says that the
amount of freight moved along Texan highways is expected to nearly
double over the next 25 years, although it does not indicate the
source of that forecast. In addition, the company has confirmed
that its first commercial AV product will be launched in the
trucking sector, "where the market is largest today, the unit
economics are best, and the level of service requirements is most
accommodating". Although Aurora has outlined its plans to expand
its AV testing, it has not said how many vehicles will be in its
Texan fleet or when it is expecting to achieve commercialization.
Aurora was established by former Google executive Chris Urmson and
has signed deals with several automakers, including Hyundai and
Fiat Chrysler Automobiles. However, a proposed deal to work with
Volkswagen (VW) was cancelled ahead of VW's investment in Argo AI
and partnerships with Ford. (IHS Markit AutoIntelligence's
Stephanie Brinley)
Ford and Intel's Mobileye have formed a partnership aimed at
improving the camera-based detection capabilities of
driver-assistance systems, including collision avoidance.
Meanwhile, Ford has appointed a new general counsel and a new
purchasing vice-president. Under the new partnership with Ford,
Mobileye will provide its suite of EyeQ sensing technology to
support Ford's existing Co-Pilot360 driver-assistance features.
This technology will include Mobileye's EyeQ computer chips and
software to help identify precisely what the windshield camera
sees. Ford says the Mobileye technology will support lane-keeping,
automatic high-beam headlights, pre-collision assistance with
automatic emergency braking, and intelligent adaptive cruise
control features. Ford also will use the technology to support its
upcoming active driver assistance technology. (IHS Markit
AutoIntelligence's Stephanie Brinley)
PetMed Express has highlighted continued buoyancy in the US
companion animal sector by posting a 20% sales upturn during its
fiscal first quarter. For the quarter ended June 30, sales reached
$96.2 million. The firm benefitted from higher reorders, more
first-time customers and increased average order size, as pet
owners increasingly adopt online spending habits. Reorder sales
were up 19% to $80.4m, while new orders came to $15.8m (+29%).
PetMed gained around 186,000 new customers in the quarter. This is
compared to 140,000 new customers in the same period of 2019. The
average order size for the latest quarter was $89, compared to $86
at this point last year. Delray Beach, Florida-based PetMed said
net income for the quarter was $7.8m - up slightly on the $5.3m
posted this time last year. (IHS Markit Animal Health's Joseph
Harvey)
Europe/Middle East/ Africa
Most European equity markets closed higher today; Germany
+1.0%, Italy +0.5%, Spain/France +0.2%, and UK +0.1%.
10yr European govt bonds closed mixed; UK -2bps, Italy -1bp,
Germany flat, and France/Spain +1bp.
iTraxx-Europe closed -2bps/58bps and iTraxx-Xover
-5bps/341bps.
Brent crude closed +2.4%/$44.32 per barrel, which is its best
close since 6 March.
The unusually long meeting of the European Council over the
last few days finally secured an agreement on the recovery fund,
modifying the preliminary arrangements announced by the European
Commission in June. (IHS Markit Economist Ken Wattret)
As highlighted previously, the fanfare accompanying the
announcement reflects three key aspects of the agreement: its
scale, and the methods of funding and distribution. In broad terms,
they all still apply to the modified deal, though there have been
some significant amendments.
In brief, the European Commission will use its AAA rating to
borrow EUR750 billion in total, to be distributed across the EU
member states. EUR390 billion will be disbursed in the form of
grants (down from the initial proposal of EUR500 billion), with
EUR360 billion in the form of loans (up from the initial EUR250
billion).
To be eligible, EU member states will need to prepare national
recovery and resilience plans setting out their reform and
investment agendas for the years 2021-23. These will assessed by
the Commission on the basis of consistency with the objectives of
strengthening growth potential, job creation and economic and
social resilience, along with contributions to the EU's green and
digital transition agenda. Approval by EU member states will be via
Qualified Majority Voting.
EUR313 billion of grants and EUR360 billion of loans will be
disbursed via the main Recovery and Resilience Facility (RRF), with
the rest distributed through a variety of smaller programs. In
2021-22, 70% of the grants provided by the RRF will be disbursed,
with the remaining 30% to follow by the end of 2023.
RRF grant allocations for member states will be determined
primarily by historic unemployment rates and COVID-19 virus-related
GDP losses. Overall, under the new proposals, as before, Italy,
Spain and some emerging European countries including Poland are set
to be the main beneficiaries.
Due to opposition from a handful of member states - Austria,
Denmark, the Netherlands and Sweden (which became known as the
"frugal four") - various adjustments had to be negotiated, leading
to the exceptionally long duration of the meeting of the European
Council.
In addition to the change in the split between grants and
loans, the four member states also secured increases in their
rebates from their contributions to the EU budget. Another notable
change was the introduction of an "emergency brake" to halt
transfers if a member state is considered not to be fulfilling its
reform objectives. The brake is time limited at three months,
however, with the ultimate decision in the hands of the Commission.
Disbursements will also be linked to observing the rule of law, a
particular focus for Poland and Hungary.
In order to secure an agreement, some elements of the "New EU"
agenda were dropped, including a proposed solvency instrument to
aid recapitalization of struggling companies.
There was also a large reduction in the proposed budget for the
"Just Transition Fund", which has the goal of lowering the cost to
lower-income member states of reductions in carbon emissions.
The UK's central government finances are displaying
considerable stress from the COVID-19 virus crisis. Substantial
fiscal costs are resulting from the public health measures and
policies to support businesses and households. (IHS Markit
Economist Raj Badiani)
Chancellor of the Exchequer Rishi Sunak has revealed that
direct spending to combat the COVID-19 virus crisis had risen to
GBP158.7 billion (USD200 billion). Including the new measures
announced in his summer statement, direct spending will rise to
GBP190 billion, or around 9.5% of nominal GDP (estimated at
GBP1.9876 trillion in 2020).
According to the Office for National Statistics (ONS), UK
government borrowing (public-sector net borrowing excluding
public-sector banks; PSNB ex) stood at GBP35.2 billion in June,
which was GBP28.3 billion higher than a year earlier (see first
chart below).
Encouragingly, the borrowing estimate for May has been revised
down by GBP9.8 billion to GBP45.5 billion, in line with higher
calculations for tax receipts and National Insurance
contributions.
Nevertheless, in the first three months of the current fiscal
year (FY; three months to June), government borrowing was GBP127.9
billion, up from GBP24.7 billion a year earlier.
Central government receipts collected by HM Revenue &
Customs fell for the fourth month in June, declining by 20.1% year
on year (y/y), pulled down by shrinking economic activity, job
losses, and companies deferring tax payments.
VAT cash receipts continued to plunge in line with the
government's VAT payment deferral policy, allowing firms to delay
their VAT payments due between 20 March and 30 June to early 2021
(before 31 March 2021). In June, VAT cash receipts plunged by 86.4%
y/y to GBP1.1 billion.
Swiss Federal Customs Office data reveal that nominal,
seasonally and working-day adjusted exports rebounded by 6.9% month
on month (m/m) in June, after -0.9% in May and -12.6% in April.
Imports increased 7.3% m/m in June, following a sharp initial
increase of 10.5% already in May but a much larger plunge in April
(-21.9%). (IHS Markit Economist Timo Klein)
In year-on-year (y/y) terms, exports at -15.1% are now broadly
on a par with imports at -15.7%, having outperformed in recent
months.
The seasonally adjusted trade surplus has edged up slightly
from May's CHF2.7 billion to CHF2.8 billion in June, which is well
below April's all-time high of CHF4.1 billion but only moderately
smaller than the surplus of CHF3.2 billion in June 2019. The
picture is somewhat less favorable in price-adjusted terms,
however, as June's deficit of CHF0.5 billion compares to the
previous month's -CHF0.8 billion and just -CHF0.1 billion in June
2019.
The sector breakdown for price-adjusted exports in June - total
at 7.9% m/m - reveals that chemicals/pharmaceuticals, Switzerland's
largest export sector by far (encompassing more than half of total
exports), underperformed at 3.2% m/m. There was a similar
underperformance in May, but this reflects the very elevated base
created by a much-better-than-average performance of the sector
during January-April. The sector's second-quarter dip of -5.0% q/q
was thus much more limited than for overall exports (-12.5%).
In June alone, the driving factors for the export recovery were
precision instruments (17.3% m/m), watches (39.4%), and jewelry
(195.5%).
The breakdown for real imports was similar: an overall increase
of 5.5% m/m was driven by vehicles (58.2% m/m), precision
instruments (9.1%), and jewelry (43.6%; this is a relatively small
sector, however). By contrast, deliveries to the
chemical/pharmaceutical sector posted -4.4% m/m, though - as in the
case of exports - following outperformance during
January-April.
The most conspicuous aspect of the export breakdown by region
(only available in nominal terms; total at 6.9%) was the strong
rebound to Asian destinations (19.4% m/m), with exports to China
(21.3%) even surpassed by those going to the Middle East (37.3%),
Singapore (39.5%), and India (27.0%).
Exports to the EU were close to the overall average at 7.1%
m/m, whereas those destined for North America (US and Canada) only
increased by 3.2%.
Switzerland-based private equity firm Partners Group has agreed
to acquire a major equity stake in Portuguese crop input company
Rovensa from private equity group Bridgepoint. Rovensa is a
provider of crop protection, biopesticide and biostimulant
products. The transaction values the company at an enterprise value
of around €1 billion ($1.1 billion). Following the investment,
Partners Group will work closely with Rovensa's management team,
led by chief executive officer Eric van Innis, on several key
strategic initiatives, including the accelerated development of the
company's biological solutions portfolio, the continued
"internationalization" of the company, and select further
acquisitions to continue to build its capabilities. In addition,
Partners Group plans to continue to support the company's research
and development culture, focusing on high-growth market niches.
(IHS Markit Crop Science's Sanjiv Rana)
Renault Group has revealed that its global sales have fallen by
more than one-third during the first half of 2020 as the COVID-19
virus pandemic had a significant impact on its performance. (IHS
Markit AutoIntelligence's Ian Fletcher)
According to data released by the automaker, group demand
retreated by 34.9% year on year (y/y) to 1,256,658 units during the
six months ending 30 June. Of this total, passenger car sales fell
35.9% y/y to 1,031,081 units, while light commercial vehicle (LCV)
sales contracted at a slightly lower rate of 29.8% y/y to 225,577
units.
At a brand level, sales of the group mainstay Renault brand
fell 37.9% y/y to 760,299 units, while Dacia sales dropped 46.2%
y/y to 211,158 units.
Sales of the predominantly Russian Lada brand also retreated by
a higher rate of 23.3% y/y to 152,714 units.
Combined sales of its Jinbei and Huasong brands from its
Chinese partnership with Brilliance declined by a relatively modest
10.5% y/y to 70,125 units, as deeper losses in its local market
during earlier months from the COVID-19 virus have been caught up
in recent months.
However, the group brands' results were not all negative. Sales
of the South Korea-only Renault Samsung brand have grown 58.8% y/y
to 53,142 units thanks to the launch of the new XM3, which is sold
as the Renault Arkana in other global markets, while there was also
some support to the results from the QM6 as well, following big
revisions to its offering.
The disbanding of a joint venture (JV) between General Motors
(GM) and AvtoVAZ means that Renault Group now includes the
Chevrolet Niva - now sold under the AvtoVAZ brand - as part of its
global sales, with 8,520 units sold since the beginning of the
year.
In its core European region, its light-vehicle sales fell by
41.8% y/y to 623,854 units, with a 36.1% y/y fall to 242,534 units
suffered in the French market alone, although its performance in
June has been helped by newly introduced market incentives.
Another region where it has suffered steep declines is the
Americas, where the group largely focuses on South America. In this
region, Renault's sales tumbled by 44.7% y/y to 113,826 units, as
its performances in Brazil, Argentina and Colombia helped dragged
it backwards at this rate.
In the Africa, Middle East, India and Pacific region, Renault's
sales dropped 30.8% y/y to 150,734 units, as while sales jumped by
51.3% y/y to 55,242 units in South Korea on new models, there were
significant losses in other markets, including India, Morocco, and
Algeria.
The company will announce how great the financial impact on its
business has been when it reveals its first-half 2020 results on 30
July. However, the company is already looking at a more positive
second half of the year. It has already felt some benefit from the
incentives being introduced by some governments in Europe to
revitalize demand.
On a seasonally adjusted basis, Polish industrial production
increased by 9.7% month on month (m/m), after 12.2% m/m growth in
May. However, seasonally adjusted output in June remained 4.9%
lower than in June 2019. (IHS Markit Economist Daniel Kral)
On a seasonally unadjusted basis, Polish industrial output in
June was 0.5% higher year on year (y/y). This was driven by a
positive calendar effect with two more working days in June and a
positive base effect, as June 2019 was especially weak.
Among the main sub-groups, output in durable consumer goods
increased by 16.2% y/y, intermediate goods by 3.5% y/y, and
non-durable consumer goods by 3.3% y/y. Energy and capital goods
declined by 9.9% y/y and 8.6% y/y, respectively.
On a seasonally unadjusted basis, 21 out of 34 industrial
divisions increased in June compared with June 2019. Among them,
the biggest increases were recorded in the manufacture of
furniture, up by 19.3% y/y, and wood products, up by 17.6% y/y, as
well as the manufacture of electrical equipment, up by 17.6%
y/y.
On a monthly basis, the largest increases were recorded in the
manufacture of motor vehicles, up by 80.2% m/m; the manufacture of
leather and related products, up by 37.2% m/m; and the manufacture
of furniture, up by 33.4% m/m.
Despite the strong bounce back in industrial activity,
enterprise employment in June shrunk by 3.3% y/y. The large
increase in monthly wages may be related to lower paid jobs being
cut first, resulting in higher average wages.
In a separate release, retail sales in June were 8.1% higher
than in May on a seasonally adjusted basis. Compared with June
2019, retail sales were down by 1.3% (or 1.9% in nominal
terms).
Among retail sales sub-components, the largest growth was
recorded in furniture, radio, TV, and household appliances, up by
16.1% y/y (consistent with the outperformance of the industry
division), and newspapers and books, up by 6.1% y/y.
On 18 July, the Central Bank of the Republic of Turkey (TCMB)
raised its foreign-currency reserve requirements by 300 basis
points across all liability types and maturity brackets for all
banks. The Bank estimated, in its press release announcing the
move, that it would withdraw USD9.2 billion of foreign-currency and
gold liquidity from the market. (IHS Markit Economist Andrew Birch)
The TCMB also pointed out that it had initially dropped its
foreign-currency reserve requirements by 500 basis points on 17
March, releasing USD5.1 billion of liquidity at the time to support
credit operations at the height of the financial crisis triggered
by the rapid global spread of the COVID-19 virus.
In a secondary move, the TCMB has reportedly also now raised
charges on commercial banks' foreign currency deposits. This action
would thus push commercial banks to either reduce the interest
rates paid for foreign currency deposits or even start charging for
those deposits according to former TCMB governor Durmus
Yilmaz.
The resulting action would push households and/or non-financial
institutions to either hold their hard currencies outside of the
banking system or convert their holdings to lira - the likely
targeted goal of the action as it would relinquish more hard
currency to the banks to subsequently turn over to the state.
Although the TCMB, in its press release, is presenting the
reserve requirement increase as a measure to normalize the
financial system and support financial security, it is likely more
targeted at rebuilding depleted official foreign currency reserves.
Defense of the lira has severely undermined official foreign
currency reserves.
Estonia-based ride-hailing firm Bolt has launched a low-cost
service called Bolt Go in 35 South African cities. The company
claims that Bolt Go fares will be approximately 20% cheaper than
those of the regular Bolt rides. The service will allow drivers to
use hatchback cars to serve riders in the country by accessing the
Bolt platform. The Bolt Go service will include the company's
existing Trip Protection, a no-cost, value-added insurance product
that covers all passengers and drivers in case of an accident.
Gareth Taylor, country manager of Bolt South Africa, said, "Smaller
hatchback cars are less expensive to purchase, have lower
maintenance costs, and are more fuel-efficient to operate than
Bolt's regular larger sedan cars. These lower operational costs
also enable Bolt Go fares to be significantly more affordable."
(IHS Markit Automotive Mobility's Surabhi Rajpal)
Asia-Pacific
APAC equity markets closed higher across the region; Australia
+2.6%, Hong Kong +2.3%, India/South Korea +1.4%, Japan +0.7%, and
China +0.2%.
Japan's Consumer Price Index (CPI) rose by 0.1% from a month
earlier on a seasonally adjusted basis in June, and year-on-year
(y/y) growth also remained at 0.1%. The CPI, excluding fresh food
(core CPI) - a reference series for the Bank of Japan (BoJ) - also
rose by 0.1% month on month (m/m) and moved up to the year-earlier
level following two consecutive months of deflation. The CPI,
excluding food and energy (core-core CPI), also increased by 0.1%
m/m, and y/y growth continued to rise at 0.4%. (IHS Markit
Economist Harumi Taguchi)
Although declines in energy prices and day-care/preschool fees
were major factors behind sluggish inflation, weaker increases in
fresh food were offset by softer declines in gasoline and electric
charges.
The shift to stay-home/working-from-home lifestyle lifted
demand for home electronics and helped lift prices of household
durable goods and mobile phone communication charges, these were
largely offset by larger declines in accommodation fees.
The June results reflected mixed effects of the COVID-19 virus
pandemic, but Japan's CPI is likely to remain weak over the near
term because of downbeat outlooks for global oil prices and
sluggish domestic demand.
Business re-openings could help a recovery of demand, discount
sales of out-of-season goods, declines in wages because of lower
working hours and performance-linked bonuses, and social distancing
practices will continue to weigh on prices.
After reporting zero confirmed cases for 14 consecutive days,
Beijing lowered its emergency response back to third level on 20
July, after raising it to second in mid-June. Large scale testing
efforts helped to stop the local new case count at a 335 during
this "second wave" of outbreak. (IHS Markit Economist Lei Yi)
Eased restrictive measures enable a range of offline activities
to resume, including reopening indoor sports and entertainment
venues such as museums and theaters, organizing trans-provincial
group tours, and holding events with up to 500 people. Quarantine
measures will only be imposed on those traveling from abroad or
from domestic areas with medium to high infection risks.
In particular, the commerce department of Beijing will
re-launch the shopping festival that was suspended due to the
recent case surge. Local government plans to introduce various
promotions to boost holiday shopping, night economy, and online
sales.
As of 16 July, work resumption rate in Beijing had basically
returned to levels seen in early June. Nearly 100% of major office
buildings, large construction sites, large industrial enterprises
and large supermarkets have resumed work; while catering businesses
slightly lag behind, with their work resumption rate reaching
91.1%, 1.8 percentage points lower than before the recent
outbreak.
China's ride-hailing giant Didi Chuxing (DiDi) is considering
an initial public offering (IPO) by this year end, reports
Pandaily. According to the report, the company plans to be listed
in Hong Kong and is seeking valuation of more than HKD600 billion
(USD80 billion). DiDi has over 31 million drivers registered on its
platform and has attracted 550 million customers, who are using the
company's range of app-based transportation options. DiDi is
strengthening its presence in markets beyond China and has formed a
global ride-sharing partnership network with Grab, Lyft, Ola, Uber,
99, Taxify, and Careem, in countries covering over 80% of the
world's population. The company has tapped many markets worldwide
by either launching its own services or investing in local
ride-hailing firms. (IHS Markit Automotive Mobility)
Heirs of Samsung Electronics and Hyundai Motor Group have
discussed their planned collaboration in the electric vehicle (EV)
and mobility businesses, reports Yonhap News Agency. The companies'
de facto leaders Lee Jae-yong of Samsung and Chung Euisun of
Hyundai Motor have met officially to discuss future mobility
technologies at Hyundai's research and development (R&D) center
in Namyang (South Korea). Lee was accompanied by Kim Ki-nam,
vice-chairman of the semiconductor division; Jun Young-hyun, CEO of
Samsung SDI; Kang In-yup, president of System LSI; and Hwang
Sung-woo, president of Samsung Advanced Institute of Technology.
Samsung executives were briefed on Hyundai Motor's technologies and
products related to urban air mobility and robotics and drove
Hyundai's autonomous vehicles (AVs) and hydrogen-powered cars. (IHS
Markit Automotive Mobility's Surabhi Rajpal)
Since the start of 2020, Bank Indonesia (BI) has lowered the
seven-day reverse repurchase (repo) rate by 100 basis points in a
bid to shore up economic growth. According to post-decision
statements from BI, the Board of Governors decided that the
decision to cut was consistent with low inflation and sustained
external stability, with the rupiah trading closer to
IDR14,400-14,800/USD1 since the start of July versus the
IDR16,600/USD1 hit in late March. (IHS Markit Economist Bree Neff)
According to statements by BI Senior Deputy Governor Destry
Damayanti on 20 July, the central bank now expects a "U"-shaped
recovery because of the continued rise in COVID-19 infections and
the expectation that virus containment measures cannot or will not
be fully removed for some time.
According to Damayanti, BI expects real GDP to contract between
4.0% year on year (y/y) and 4.8% y/y for the second quarter. IHS
Markit's forecast is for contractions on the order of 4.2-4.8% y/y
for the second, third, and fourth quarters of 2020 implying a
potentially extended U-shaped recovery.
Following the decision, BI Governor Perry Warjiyo has indicated
that further easing will depend on inflation, which came in at a
20-year low of 1.96% y/y in June as domestic demand remained soft,
with core inflation also sinking to a survey-low of 2.3% y/y.
Continued weakness implied in estimated June retail sales data
also points to softness in demand, as well as inflation.
The central bank's stated openness for further easing leaves
the door open to further conventional monetary easing via the
policy rate, but IHS Markit remains concerned that it will not take
too much for financial markets to be roiled by risk aversion.
Therefore, we expect at most BI could get away with cutting the
policy rate by another 50 basis points, but we assess that one more
cut of 25 basis points is most likely and will be complemented by
the continuation of BI's other macroprudential and quantitative
easing programs.
There is a call to develop variety of dairy products other than
cow milk and the rise of camel milk is part of the growth story in
China. Camel milk powder remains a small category and there is no
HS code allocated yet. According to Xinhua Net (June 27),
Kazakstan's camel milk has recently made an official entry into
China. A factory, owned by Eurasia Investment Co Ltd, based in the
central Kazakhstan's Karaganda region produces camel and horse
milk, with an annual output of 60 tons of each. The raw material is
from their own 200 camels and 2,500 horses. The factory is planning
to increase the output to 200-300 tons per annum. On January 29,
China's General Administration of Customs granted the factory an
export license. Three Kazakh enterprises producing camel dairy
products, including Eurasia Invest, are among the first batch of
companies to receive export licenses. However, they have yet not
obtained an export license for horse milk to China. Sales are made
through e-commerce to Chinese consumers directly. Kazakhstan's
Ministry of Agriculture reported (June 17) that the country
produced 423 tons of horse milk in H1 2020, up by 17% over the year
before. In 2019, the country produced 1,103 tons. In the same
period, it produced about 1,000 tons of camel milk. In 2019, total
production was 3,177 tons, up by 45%. (IHS Markit Food and
Agricultural Commodities' Hope Lee)
Posted 21 July 2020 by Chris Fenske, Head of Fixed Income Research, Americas, IHS Markit
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