Stellantis, CATL to Invest $4.33 Billion in EV Battery Plant in Spain -- Commodities Roundup

MARKET MOVEMENTS:

--Brent crude oil is down 0.5% at $71.80 a barrel.

--European benchmark gas is up 0.7% at 45.19 euros a megawatt-hour.

--Gold futures are up 0.4% at $2,697.70 a troy ounce.

--LME three-month copper futures are down 0.5% at $9,181.50 a metric ton.

TOP STORY:

Stellantis, CATL to Invest $4.33 Billion in EV Battery Plant in Spain

Jeep maker Stellantis and Chinese battery maker CATL plan to invest up to 4.1 billion euros ($4.33 billion) to build a plant in Spain to develop low-cost EV batteries, seeking to bring more affordable electric cars to the market.

Stellantis and the Chinese company, formally known as Contemporary Amperex Technology, said Tuesday that the plant will develop lithium-iron-phosphate batteries for electric cars in the northeastern Spanish city of Zaragoza.

Lithium-iron-phosphate batteries, also known as LFP, are safer and cheaper to produce than nickel, cobalt and manganese batteries, although they deliver a decreased driving range due to their lower energy density. LFP batteries are commonly used in China, but a growing number of European and North American auto makers are building plants closer to home to reduce their dependence on Chinese battery supplies. Companies are also working to boost the driving range of LFP-based EVs.

OTHER STORIES:

Toyota Backs Charging Software Startup Amid EV Market Slowdown

Toyota's venture arm is backing a startup that helps manage demand from electric-vehicle charging, its first startup investment in a sector facing sagging consumer demand.

Woven Capital, the Japanese automaker's strategic investment arm, led a $19 million equity investment in WeaveGrid. The San Francisco-based startup also raised $9 million in debt from HSBC Innovation Banking.

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Hershey Shareholders Shouldn't Count on a Mondelez Jackpot

Mondelez is reportedly sweet on Hershey once again, but investors should exercise caution: A deal would make even less sense now than when Mondelez approached the company eight years ago.

Hershey stock soared 11% on Monday after Bloomberg reported that Mondelez has made a preliminary approach about a merger. But the chocolate maker is a notoriously difficult takeover target. The Hershey Trust, which holds a controlling stake, has opposed past offers. Indeed, Mondelez itself tried in 2016 and was rebuffed.

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Keyera Sees Meeting Upper End of Guidance by 2025

Keyera said it is on track to meet the upper end of its guidance for the three-year period ending in 2025 after a strong execution in 2024.

The Calgary, Alberta-based midstream oil and gas company said Tuesday that it has executed against its strategy in 2024, and expects another year for adjusted earnings before interest, taxes, depreciation and amortization.

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Equinor's Start-Up of Johan Castberg Oil Field Delayed by Bad Weather

Equinor said bad weather delayed the start of production at Norway's Johan Castberg offshore oil field until early next year.

The Norwegian energy major had planned to start up Johan Castberg during the fourth quarter of this year but said operations will now come on stream in January or February next year.

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Thames Water Swings to Loss Amid Debt Write-Off

Thames Water Utilities logged a pretax loss for the first six months of its fiscal year after writing off a debt to its parent company and setting aside funds to cover fines from the U.K. water regulator.

The embattled U.K. water and wastewater company on Tuesday booked a pretax loss of 230.9 million pounds ($294.4 million) in the fiscal half to Sept. 30, a swing from the 73.2 million in profit reported for the same period last year.

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Centrica to Buy Back Another $383 Million Worth of Shares

Centrica extended its current share-buyback program by another 300 million pounds ($382.5 million) worth of shares, and said it expects its full-year earnings per share to match market forecasts.

The British energy company said Tuesday that it is expected to book 18.5 pence in EPS for the year, according to a consensus of 11 analysts.

MARKET TALKS:

Boliden's Mine Acquisitions Create European Metals Champion -- Market Talk

1136 GMT - Boliden's acquisition of two mines from Lundin Mining creates a clear European champion in base metals, Deutsche Bank's Liam Fitzpatrick writes. The deal makes strategic sense by increasing the group's upstream integration and adding production at an attractive price. However, Boliden is taking on more assets when cash flows are weak and capital expenditure is elevated, the bank says. Operational performance at existing assets will now be even more important. The bank hopes to hear more about investment plans at the company's capital markets day in March. "A strategy focused on improving cash flows, reducing net debt and delivering operational efficiencies would be well received." Deutsche Bank rates Boliden stock at hold with a 320 Swedish kronor target price. Shares trade 1.1% lower at 332.40 kronor. ([e-mail])

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Europe's Gas Price Eases on Milder, Windy Weather Forecast -- Market Talk

1032 GMT - European natural-gas prices ease on forecasts of milder weather, higher wind output and expectations of steady supply through the end of the year. "Renewable power generation picked up over the weekend due to storm Darragh, easing concerns of power shortages for heating," ANZ Research says. Meanwhile, European imports of liquefied natural gas have picked up in recent weeks, as milder temperatures and weak industrial demand in China are encouraging re-exports. Still, inventory withdrawals across Europe have been stronger than last year, with EU storage levels 82% full as of Sunday. The benchmark Dutch TTF contract trades 0.6% higher at 45.13 euros a megawatt hour, down roughly 7% on the week and up more than 6% on the month. ([e-mail])

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Metal Prices Slip, Returning Some Gains Made on China Policy Optimism -- Market Talk

1012 GMT - Metal prices return some of the gains made on Monday, with LME three-month copper down 0.4% at $9,193 a metric ton and LME three-month aluminum down 0.4% at $2,587 a ton. Copper had ended the prior session up 1.4% as China signaled it will step up monetary policy easing. The country's top decision-making body, the Politburo, pledged to adopt "unconventional countercyclical adjustment" to stabilize the property and stock markets, and to shift monetary policy stance to "moderately loose" for the first time since 2011, Bank of America analysts say in a note. This improved investor enthusiasm for industrial metals, as China's moribund property market has kept demand suppressed. All eyes are now on China's Central Economic Work Conference, expected later this week, which should offer more concrete policy details, BofA analysts say. ([e-mail])

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Palm Oil Ends Lower Amid Weaker Exports Data -- Market Talk

1009 GMT - Palm oil ended lower amid data showing weaker exports. Malaysia's palm oil exports slid 15% on month in November, data from the Malaysian Palm Oil Board showed. Persistent concerns about declining demand and weaker overnight prices for rival soy oil weighed on palm oil, Kenanga Futures said in a research note. However, production disruptions in Indonesia and Malaysia caused by persistent heavy rainfall and flooding has partially lifted prices, it said. The Bursa Malaysia Derivatives contract for February delivery ended 165 ringgit lower at 4,955 ringgit a ton. ([e-mail])

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China's Crude Imports Signal Improving Demand Trends, DNB Says -- Market Talk

0951 GMT - China's November crude imports signal demand trends are improving, DNB Markets analysts say. Oil imports rose 14.3% on year to 48.5 million metric tons last month. "We believe it is primarily motivated by refineries [which] sought to use up their import quotas before year end," analysts Helge Andre Martinsen and Tobias Ingebrigtsen say. "In addition, we believe oil demand in China is on an improving trend again, amid stimulus measures, after six months of soft demand." Oil markets also got a fresh boost from China's pledge to ramp up policy stimulus--a move that could help lift demand. Still, concerns over the world's top crude importer are far from gone, as November data showed disappointing trade figures overall, with exports slowing sharply and imports unexpectedly falling further compared with the month earlier. ([e-mail])

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China Oilfield Services Unlikely to Suffer From Saudi Aramco Suspensions -- Market Talk

0943 GMT - China Oilfield Services is unlikely to be significantly affected by another round of suspensions from Saudi Aramco, Citi analysts Desmond Law and Oscar Yee write in a research note. The company has four ongoing contracts with the Saudi oil giant, but drilling services accounted for just 14% of its earnings before interest and taxes, they note. The analysts maintain a buy rating and a target price of HK$10.70 on the stock, adding that while suspensions may cause some negative sentiment, they expect COS to trade above its typical price-to-book range due to improving supply-demand dynamics in offshore drilling and rising drilling day rates. Shares last closed 2.1% lower at HK$6.67, bringing year-to-date losses to 16%. ([e-mail]; @benottoWSJ)

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BP Strategy Update Needs to Focus on Improving Cash Flows -- Market Talk

0917 GMT - BP needs to be simpler and more focused in order to deliver higher value, Barclays analysts write in a research note. Progress and delivery from the British energy major has fallen short of the analysts' expectations, they say. They cite high costs, especially in the downstream segments, and around $16 billion worth of low-carbon deals that aren't showing the promise that the market wanted. This puts additional pressure on the upcoming strategy update in early February. "We see a need for the management team to highlight that cash flow can grow and that the 'origination' period of acquiring low-carbon businesses is now at an end," Barclays says. Shares are up 0.3% at 3.95 pounds. ([e-mail])

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