Thursday, April 18, 2024

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Aframax rates could face further weakening in Q2 2024 

rude tanker rates have remained quite healthy for owners in the last couple of years, especially post the Russian invasion and the changes to trade flow and fleet behaviour patterns that followed suit.

However, seasonal and regulatory downside risks could be on the cards in the months to follow for Aframax tankers with rates currently hovering below 2023 averages, according to Vortexa Tanker Basket composed from Baltic Exchanges freight assessments.

Vortexa Crude Tanker Basket vs 2023 averages (Basket = 100 @ Feb 2021), Source: Baltic Exchange

The bedrock of Aframax employment has mainly been the transatlantic US Gulf-to-Europe crude trade. In March 2024, Aframax utilisation on this route recorded the lowest point since June 2023, a 10-month low. The return of US refineries from turnaround aligned with the start of maintenance in Europe, as well as the pickup of crude supplies sourced from the Middle East Gulf on Suezmaxes, all led to a reduction in transatlantic crude flows to Europe. 

Crude MEG arrivals in Europe by vessel class (LHS, mbd) vs. US Gulf-to-Europe Aframax utilisation (RHS, no. of vessels) 

The restart of European refineries from May onwards could provide some support for transatlantic flows but the already high crude inventories in Europe will likely not leave room for a considerable improvement. Moreover, the current widening of the Aframax/Suezmax freight spread for the US Gulf-to-Europe route will prompt charterers to fix on Aframax’s bigger counterparts that provide more economically lucrative opportunities.  

The introduction of Russian sanctions by the West led to the development of a multi-tier fleet system that helped alleviate Aframax competition for mainstream trades. However the current increased sanctioning activity has sparked the return of Western operators to these non-Russian trades gradually increasing the competition once again. 

This type of behaviour could be repeated out of Venezuela. Crude tanker voyages out of Venezuela reached an 11-month high, but fears of the re-imposition of sanctions post-18th April are looming. The share of the low-risk vessels (i.e “mainstream” fleet) operating in the trade have increased from 5% by the end of 2022 to a staggering 80% in March 2024. The increase of the mainstream fleet employment is predominantly materialised on Aframaxes (19 out of the 25 voyages), heading towards the US or performing STS operations offshore Venezuela for cargoes headed towards India and China. 

Voyages out of Venezuela (no. of vessels)

Prospective US sanctions on Venezuela, especially if the initial waivers to US cease to exist, will mean that the high-risk vessels/dark fleet would once again raise their share in the Venezuelan trade – predominantly on VLCCs – at the expense of mainstream Aframax operators that will likely seek new opportunities elsewhere. 

A complete “ousting” of the mainstream Aframax from the Venezuelan and Russian trade will also hamper the mainstream fleet voyage mileage. Looking from the start of 2023, when Venezuela waivers and the EU ban on Russian crude were primarily introduced, the transportation of the respective grades on Aframaxes has added on average 25% on global voyage mileage.

Aframax laden voyage mileage: global & excl. Venezuela and Russian grades vs. % difference (RHS)

Although the majority of signals point towards the continuation of a downwards trend for Aframax tankers, there might be a silver lining in terms of employment boost. The Venezuela sanction re-introduction will naturally increase demand for the dark fleet, potentially attracting tonnage that is currently utilised in Russia. This could pave the way for mainstream operators to raise exposure in the Russian trade under the price cap, shall the sanctioning activity led by the US and the UK, which is gradually eliminating non-Western linked shipowners to transport Russian oil to countries like India, continues to take place.

Wednesday, April 17, 2024

Maine Governor Allows National Popular Vote Legislation to Become Law 

Maine Gov. Janet Mills said she will allow a narrowly passed bill that would award the state’s four electoral college votes to go toward the winner of the National Popular Vote to become law, as opposed to the current system where the votes go either to the winner of the state’s popular vote or according to the results in each of congressional district—as is the case in Maine.

A group known as the National Popular Vote (NPV) is behind a push for states to enter into a “National Popular Vote Interstate Compact” that would hand the presidency to whoever gets the greatest number of popular votes at the national level.

Rather than abolishing the Electoral College, this would require presidential electors in the states and the District of Columbia to vote for the candidate who gets the most popular votes overall, which would see the outcome of the election decided by the views of those living in major population centers like Los Angeles and Houston instead of by entire swing states.

Maine’s legislation passed the State House of Representatives on April 2 by a slim 73 to 72 margin. It cleared the Senate the following day by an 18 to 12 vote.

In an April 15 press release, Ms. Mills said she has been “carefully considering” the bill’s merits for the past ten days, and “reviewing arguments both for and against.”

She opted to give her approval to the bill without a signature. Maine’s Constitution gives governors three options to legislation that arrives at their desk: to sign a bill into law, veto it, or allow it to become law without their signature.

Supporters of the legislation argue that electing a president based on who has more support among voters in a state but not nationwide doesn’t make sense, and that the new system under the “National Popular Vote Interstate Compact” would make everyone’s vote count the same, no matter where they live.

Critics of the compact argue that the legislation is a shortcut to bypass the U.S. Constitution because such a change in the way the president is elected should involve a constitutional amendment. A constitutional amendment must be passed by a two-thirds majority in the U.S. Congress and ratified by three-quarters of the states.

They also warn it would ultimately stifle the voices of voters in smaller, rural states like Maine.

According to Ms. Mills, while she recognizes concerns about presidential candidates spending less time in smaller swing states like Maine, she thinks it’s “possible candidates will spend more time in every state when every vote counts equally”—despite the vast population differences between regions that would determine areas of concentrated voting power.

“I struggle to reconcile the fact that a candidate who has fewer actual votes than their opponent can still become President of the United States,” she said.

“Absent a ranked-choice voting circumstance, it seems to me that the person who wins the most votes should become the President. To do otherwise seemingly runs counter to the democratic foundations of our country,” Ms. Mills added.

Currently, under the electoral college system, delegates are assigned to states based on how residents are represented in Congress. States with bigger populations get more representatives in the House. But each state—no matter its population—also gets two senators to represent its interests. Electoral college delegates for most states—except Maine—have voted under a state-wide “winner-takes-all” system, where they put their vote behind the presidential candidate who wins the popular votes in their state.

The National Popular Vote Interstate Compact would change this to a “winner-takes-all” system based on the national popular vote, which needs the support of 270 delegates for participating states to determine who to send straight to the White House.

Currently, the pact’s members collectively control 205 electoral votes—65 votes short of what it needs to be effective.

Ms. Mills said that the bill that passed the Legislature in Maine is not irreversible.

“Still, recognizing that there is merit to both sides of the argument and recognizing that this measure has been the subject of public discussion several times before in Maine, I would like this important nationwide debate to continue. And so I will allow this bill to become law without my signature,” she said.

Maine has now joined 15 other states and the District of Columbia to adopt the compact. California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maryland, Massachusetts, New Jersey, New Mexico, New York, Oregon, Rhode Island, Vermont, and Washington have all passed similar legislation.

Melanie Sun contributed to this article.

Big 5 diversified mining companies are having a rough 2024

 Big 5 diversified mining companies are having a rough 2024 

At the end of the first quarter 2024, the MINING.COM TOP 50* ranking of the world’s most valuable miners had a combined market capitalization of a shade under $1.4 trillion, down $13 billion since the start of the year. 

The historic gold run and copper’s comeback, up 14% and 12% so far in 2024, only kicked into a higher gear after the end of the March quarter, but copper and gold counters nevertheless dominate the best performer list for Q1.  

MINING.COM TOP 50 - Winners and Losers Q1 2024

The lacklustre combined performance of the sector’s majors came despite the revival in the bellwether metals, but the broader market has  been a mixed bag in 2024.  

Aluminium is trading not far off 52-week highs, but zinc seems unlikely to breach $3,000 a tonne any time soon and cobalt is bobbing along historic lows below $30,000 a tonne.

Nickel has been bumped up after lows in the mid-$15,000s last year, but remains firmly stuck in bear territory and lithium’s 2024 good fortune also looks in danger of petering out.

Sentiment towards PGMs has hardly improved with both platinum and palladium drifting lower in 2024. Even iron ore prices back above $100 a tonne – the bread and butter of the diversified majors – was not enough for investors to jump back into the sector.

Gold, copper boost 

First Quantum Minerals with market valuation up 58% in US dollar terms, made a welcome return at position 44 after dropping out at the end of last year following the closure of its Cobre Panama mine. 

Amman Mineral continued its astounding run – the Indonesian copper and gold miner has added 380% in value since its July listing and could soon vie for a place in the top 10. 

Lundin Mining joins the top 50 for the first time, jumping five places to 48 and is already climbing thanks to the red metal approaching 14-month highs.  Lundin’s 25% rise in 2024 also restores Vancouver as the number one location among top 50 headquarters after Pilbara Minerals’ exit this quarter. 

Anglogold Ashanti’s re-entry boosts the number of precious metals miners in the top tier to 10 and their collective value to $183 billion. 

China’s Yintai Gold, which in February picked up Canada’s Osino Resources, could also challenge for a position in the upper echelon from its current 54th position should gold continue to rally, but long term top 50 participant KGHM has a hill to climb to make it back despite shares in the Polish mining company rising 15% year to date.    

MINING.COM TOP 50 - Countries  Q1 2024

Pan American Silver, like its primary metal, could ride gold’s coattails to become the only silver-focused miner in the top 50 following Fresnillo’s exit more than a year ago.  Silver is now the best performing metal year to date, up more than 18%.  

Diversified drubbing 

While the top 50 mining companies as a whole drifted sideways during the quarter, the largest diversified companies faced headwinds going into 2024, and uncharacteristically some of the biggest names in mining feature on the worst performers list for the quarter.  

The only $100bn companies in the ranking – BHP and Rio Tinto – were both down by double digits at the end of Q1 and Glencore’s rerating over the past couple of years went into reverse with declines of 9% in 2024.

Vale’s pullback from its valuation at the end of 2023 places the stock firmly in bear territory with losses of nearly 24% in US dollar terms. The Brazilian giant sold 13% of its base metals unit for $3.4bn to amongst others, the Saudi Arabia’s sovereign wealth fund, but given the performance of nickel a separate listing seems off the table for now.

Anglo American stock had a fairly uneventful Q1 2024 after the sharp H2 2023 sell-off sparked by copper guidance,  PGM and South African power woes, and despite the bad news from its Woodsmith fertiliser project in England. 

Nevertheless, the counter has dropped  below a $30 billion market cap for the first time since the outset of the pandemic and losses for the past 12 months top 30%. Rumours that Glencore may be interested after the Swiss behemoth’s bid for all of Teck Resources fell through have died down, probably for the right reasons

The ranking remains top heavy, but as a group the historic top five diversified mining companies’ share of the MINING.COM Top 50’s overall valuation fell to a new low of 29%, down from 36% at the end of 2022.  

China cheer


The historic top 5 diversifieds should in fairness be expanded to seven and include Saudi Arabia’s Ma’aden and Zijin Mining, the highly acquisitive Chinese firm is up over 30% so far this year and appears to be well ensconced in the top 10.

Xiamen-based Zijing at the end of Q1 fell just short of a $60bn market worth (indeed gold and copper’s run in the first week of Q2 has now lifted the stock above that milestone). 

On the best performer list for the quarter, Zijin sits just behind CMOC Group, formerly China Molybdenum and for years before being overtaken by Zijin the most valuable middle kingdom mining stock, and ahead of Jiangxi Copper, which jumps 9 places to 41 in Q1. 

The 10 Chinese companies in the ranking collectively are worth $192bn or 14% of the overall value, up from 8 companies valued at $115bn and 9% of three years ago. 

Lithium loss 

Three counters dropped out of the top 50 during the first quarter.  Brazil’s CSN Mineração, an iron ore miner, China’s Huayou Cobalt and Australian lithium producer Pilbara Minerals.

Pilbara Minerals only just lost out to Kinross Gold for the last spot as at end-March and lithium prices have recovered somewhat this year, but probably not enough for the lithium sector to outperform gold stocks in Q2. 

The merger of Livent and Allkem to form Arcadium Lithium also did not result in an increase in lithium mining’s representation in the ranking.  Arcadium Lithium has been hammered down to below a $5bn valuation this year. 

From its height of a collective $119bn valuation at the end of the second quarter of 2022, the combined value of the lithium stocks in the top 50 has now fallen to $59 billion.

Click on the table below for a full-size image.


Source: MINING.COM,  GoogleFinance, stock exchange data, company reports. Share data from primary-listed exchange at March 28, 2024 – March 29, 2024 close of trading converted to US$ at cross-rates March 29, 2024. 

Percentage change based on US$ market cap difference, not share price change on exchange in local currency.  

As with any ranking, criteria for inclusion are contentious. We decided to exclude unlisted and state-owned enterprises at the outset due to a lack of information. That, of course, excludes giants like Chile’s Codelco, Uzbekistan’s Navoi Mining, which owns the world’s largest gold mine, Eurochem, a major potash firm, and a number of entities in China and developing countries around the world.

Another central criterion was the depth of involvement in the industry before an enterprise can rightfully be called a mining company.

For instance, should smelter companies or commodity traders that own minority stakes in mining assets be included, especially if these investments have no operational component or warrant a seat on the board?

This is a common structure in Asia and excluding these types of companies removed well-known names like Japan’s Marubeni and Mitsui, Korea Zinc and Chile’s Copec. 

Levels of operational or strategic involvement and size of shareholding were other central considerations. Do streaming and royalty companies that receive metals from mining operations without shareholding qualify or are they just specialised financing vehicles? We included Franco Nevada, Royal Gold and Wheaton Precious Metals on the basis of their deep involvement in the industry.

Vertically integrated concerns like Alcoa and energy companies such as Shenhua Energy or Bayan Resources where power, ports and railways make up a large portion of revenues pose a problem. The revenue mix also tends to change alongside volatile coal prices. Same goes for battery makers like CATL which is increasingly moving upstream, but where mining still makes up a small portion of its valuation.  

Another consideration is diversified companies such as Anglo American with separately listed majority-owned subsidiaries. We’ve included Angloplat in the ranking but excluded Kumba Iron Ore in which Anglo has a 70% stake to avoid double counting. Similarly we excluded Hindustan Zinc which is listed separately but majority owned by Vedanta.

Many steelmakers own and often operate iron ore and other metal mines, but in the interest of balance and diversity we excluded the steel industry, and with that many companies that have substantial mining assets including giants like ArcelorMittal, Magnitogorsk, Ternium, Baosteel and many others.

Head office refers to operational headquarters wherever applicable, for example BHP and Rio Tinto are shown as Melbourne, Australia, but Antofagasta is the exception that proves the rule. We consider the company’s HQ to be in London, where it has been listed since the late 1800s.

Please let us know of any errors, omissions, deletions or additions to the ranking or suggest a different methodology.

Vale operations in Brazil now 100% renewable energy-powered

 Vale operations in Brazil now 100% renewable energy-powered 

Vale (NYSE: VALE) announced Monday it had achieved its goal of running all of its Brazilian operations based on renewable energy sources, two years earlier than the scheduled target of 2025.

The Rio de Janeiro-based top iron and nickel producer said that 100% of the electricity used in its local operations last year came from green sources, such as hydroelectric, wind and solar power plants.

With this milestone, Vale has eliminated its indirect CO2 emissions in Brazil, corresponding to scope 2. The company still faces the challenge of reaching 100% renewable energy consumption in its global operations by 2030. Currently, this figure stands at 88.5%.

Vale’s decarbonization strategy aims to reduce its scope 1 and 2 carbon emissions (direct and indirect) by 33% by 2030 and to become net-zero by 2050.

“As we are progressing on our targets, we are helping to make Brazil’s energy matrix even cleaner, contributing to society’s fight against climate change,” Vale’s director of Energy and Decarbonization, Ludmila Nascimento, said in the statement.

Vale said starting up the Sol do Cerrado solar complex in November 2022 was key to achieving the target two years ahead of schedule. 

Located in the state of Minas Gerais, this complex represented an investment of $590 million and it is considered one of the largest solar energy parks in Latin America.

While it has an installed capacity is of 766 Megawatts-peak, equivalent to the consumption of a city of 800,000 inhabitants, the complex has the potential of contributing to around 16% of all the electricity consumed by Vale in Brazil, the company said.

Three decades long journey

Vale began its journey towards 100% renewable energy consumption in the 1990s with the acquisition of its first hydroelectric plants.  

The company’s activities are now powered by a renewable energy portfolio with an installed capacity of 2.6 GW, equivalent to the energy consumption of over 3 million people. 

The company holds 14 assets through direct and indirect participation, including ten hydroelectric plants, three wind farms, and Sol do Cerrado. If it functioned as a power generator, Vale would rank as the 15th largest in the country.

On a global scale, the mining giant is investing in joint venture partnerships, renewable generation certificates in contracts (PPAs), and innovation initiatives to enhance battery efficiency.

Vale is also focused on reducing its direct Scope 1 emissions. In the mining and railroad sectors, where diesel (a fossil fuel) is currently heavily used, the company is exploring the adoption of alternative fuels, such as ethanol for trucks and green ammonia for locomotives. Additionally, in the pelletizing furnaces, the plan is to substitute anthracite, a type of mineral coal, with zero-emission biocarbon produced from the carbonization of biomass.

Vale inked a deal with Wabtec in 2023 for the provision of three electric locomotives and initiated studies on the development of a green ammonia-powered locomotive engine. 

It also successfully produced pellets using 100% biocarbon for the first time in an industrial test last year. Pellets production accounts for 30% of the firm’s direct emissions.

China’s March iron ore imports edge up, steel exports near 8-year high

China’s Hunger for Commodities Is Wavering After Years of Growth 

China’s iron ore imports in March rose about 0.5% from a year earlier, customs data showed on Friday, amid expectations that demand will pick up after the Lunar New Year holiday break as steelmakers typically ramp up production.

The world’s largest iron ore consumer brought in 100.72 million metric tons of the key steelmaking ingredient last month, data from the General Administration of Customs showed.

That compares with 97.51 million tons imported in February and 100.23 million tons in March 2023.

The relatively high level of imports were probably driven by expectations steel mills would resume production in March, which would then push up ore demand, said Chu Xinli, a Shanghai-based analyst at China Futures.

But demand was much weaker-than-expected last month, which together with the high imports contributed to a pick-up in portside stocks and a steep drop in prices.

Iron ore inventories at major Chinese ports rose 5.3% to 142.1 million tons by the end of March, the highest since late February 2023, while ore prices tumbled over 13%, data from consultancy Steelhome showed.

China’s iron ore imports in the first quarter of 2024 totalled 310.13 million tons, up 5.5% from a year earlier, customs data showed.

“Fewer weather-related disruptions on shipments from major suppliers Australia and Brazil also played a role in high imports,” Pei Hao, a Shanghai-based analyst at international brokerage FIS, said.

Imports in April will likely rise further on a monthly and an annual basis, Pei added.

“Seaborne cargoes in late March and the first half of April remained at a relatively high level, and this may mean that it’s hard to see a big reduction in import volumes this month.”

Steel trade

With domestic demand not recovering as much as expected, China’s exports of steel products rose by 25.35% in March year on year to 9.89 million tons, the highest since July 2016.

The March volume brings the total in the first quarter to 25.8 million tons, the highest for the period since 2016 and a rise of 30.7% year on year, customs data showed.

China’s imports of steel products in March declined by 9.26% to 617,000 tons, with the total for January-March falling 8.6% year-on-year to 1.75 million tons.

(By Amy Lv and Andrew Hayley; Editing by Himani Sarkar and Kim Coghill)

US Steel shareholders approve Nippon Steel’s $14.1 billion takeover offer 

United States Steel Corp. shareholders voted in favor of a $14.1 billion takeover offer by Nippon Steel Corp., leaving the fate of the deal for the iconic American steelmaker to the realm of US regulators and politics.

Investors of US Steel endorsed the Japanese steelmaker’s $55-a-share offer at a special shareholders’ vote Friday with more than 98% approval, the company said in a statement. The vote was widely expected to pass. Attention now shifts to a pending US regulatory review for an offer that has become mired in a political firestorm in a US presidential election year.

Shares of Pittsburgh-based US Steel fell 2.6% to $41.13 at 1:52 p.m. in New York.

Nippon Steel agreed in December to buy US Steel at a significant premium, but the deal was quickly met with pushback from union workers who operate most of the US steelmaker’s plants and influential politicians who voiced concerns about foreign ownership. President Joe Biden and presumptive Republican presidential nominee Donald Trump both oppose the deal as they vie for blue-collar votes in key swing states ahead of November’s election.

Biden has called for domestic ownership and announced his support for US workers, raising doubts on whether Nippon Steel can succeed in closing the transaction.

“Irrespective of the shareholder vote, we continue to expect this ultimately is decided by the White House,” Timna Tanners, an analyst at Wolfe Research, said in an interview.

Nippon Steel’s all-cash offer carries a 142% premium to US Steel’s share price on the last day of trading before the US company announced a strategic review.

Beyond politics, the takeover must pass a review by the Committee on Foreign Investment in the United States, or CFIUS. The review is unlikely to conclude until late this year and may extend into 2025, people familiar with the matter said in January. Such a time frame — already much longer than what the companies signaled — thrusts the takeover into the middle of the US election campaign.

US Steel and Nippon Steel are mulling a decision to formally push back the time frame they expect to close the deal.

(By Joe Deaux)

Iron ore climbs to multi-week high on lower shipments, hopes of China stimulus

 Iron ore price tops $100 a tonne for the first time in 5 years 

Iron ore futures prices extended their rise to hit the highest level in multiple weeks on Monday, bolstered by an obvious reduction in shipments and hopes that top consumer China will roll out more stimulus to prop up its economy.

The most-traded September iron ore contract on China’s Dalian Commodity Exchange (DCE) ended daytime trade 2.18% higher at 845.5 yuan ($116.80) a metric ton, the highest since Mar. 26.

The benchmark May iron ore on the Singapore Exchange was 1.31% higher at $112.5 a ton, as of 0720 GMT, the highest since Mar. 11.

Dalian iron ore rose for a sixth straight trading session, while the Singapore contract rose for a third straight session.

Iron ore shipments from top suppliers Australia and Brazil tumbled by 28.8% week-on-week to 19.19 million tons in the week of Apr.8-14, data from consultancy Mysteel showed.

China’s economy is expected to have slowed in the first quarter as a protracted property downturn and weak private-sector confidence weighed on demand, maintaining pressures on policymakers to unveil more stimulus measures.

Also, new-bank lending in China rose less than expected in March from the previous month, while broad credit growth hit a record low and property woes lingered.

State-backed Chinese real estate developer Vanke said it is facing short-term liquidity pressures and operational difficulties but has prepared “a basket of plans” to stabilize its business and cut debt.

Other steelmaking ingredients on the DCE recorded gains, with coking coal and coke up 3.97% and 2.92%, respectively.

Steel benchmarks on the Shanghai Futures Exchange were mixed.

Rebar was little moved, wire rod declined 0.99%, while stainless steel added 1.2% and hot-rolled coil ticked up 0.32%.

“Given the remaining high steel stocks, a further increase in hot metal output might not be conducive to the sustainability of a price rebound,” analysts at First Futures said in a note.

China is due to release a slew of key data, including output of key commodities, property investment, and the economic growth for the first quarter, on Tuesday.

($1 = 7.2386 Chinese yuan)

(By Amy Lv and Andrew Hayley; Editing by Savio D’Souza and Janane Venkatraman)

TikTok’s Campaign of Using Influencers to Target Lawmakers Could Backfire

TikTok’s Campaign of Using Influencers to Target Lawmakers Could Backfire 

WASHINGTON—Key congress members and their aides say they’ve been besieged by phone calls triggered by a campaign sent out by Chinese social media giant TikTok.

Some of their constituents were delivered full-screen notifications on TikTok.

“Tell your Senator how important TikTok is to you. Ask them to vote no on the TikTok ban,” the notification said.

“Now, if the Senate votes, the future of creativity and communities you love on TikTok could be shut down.”

The notification then urged users to enter their zip code to locate their senator’s phone number.

One particular message was left for Sen. Thom Tillis (R-N.C.), which he posted on social media.

“Okay, listen, if you ban TikTok, I will find you and shoot you,“ one female caller says as others giggle in the background. ”That’s people’s job, and that’s my only entertainment. And people make money off there, too, you know. I’m trying to get rich like that. Anyways, I’ll shoot you and find you and cut you into pieces. Bye!”

Like the rest, the message stemmed from a pressure campaign orchestrated by TikTok in early March to compel its users to lobby against the Protecting Americans from Foreign Adversary Controlled Applications Act, which would ban TikTok in the United States unless it divests from its current China-based parent company.

The campaign began targeting members of the House ahead of a vote by the House Energy and Commerce Committee to move the bill to the House floor without giving the normally required week’s notice. After the legislation passed the House on March 13 in a 352–65 vote, senators began receiving the same calls.

It is too early to say whether TikTok’s mobilization campaign will bear fruit. It could just as easily scare lawmakers into action against the company rather than for it.

Rep. Lauren Boebert (R-Colo.) departs from the U.S. Capitol during a vote on legislation related to TikTok on March 13, 2024. The House voted to ban TikTok in the United States due to concerns over personal privacy and national security unless the Chinese-owned parent company ByteDance sells the popular video app within the next six months. (Anna Moneymaker/Getty Images)
Rep. Lauren Boebert (R-Colo.) departs from the U.S. Capitol during a vote on legislation related to TikTok on March 13, 2024. The House voted to ban TikTok in the United States due to concerns over personal privacy and national security unless the Chinese-owned parent company ByteDance sells the popular video app within the next six months. (Anna Moneymaker/Getty Images)

Sen. Marsha Blackburn (R-Tenn.) is one of many in the Senate who say that TikTok’s lobbying campaign is all the more reason to swiftly sever ties between the company and China.

TikTok’s parent company, ByteDance, is headquartered in Beijing, and both companies have a dubious history of suppressing content the Chinese Communist Party (CCP) finds displeasing.

“If TikTok wants to stay in the U.S. marketplace, they need to separate from the CCP’s control—plain and simple,” Ms. Blackburn told The Epoch Times.

“The Senate should take this issue up swiftly to protect our national security interests, and we should declassify the information given to Congress so that the American public can understand the exact threat we’re facing.”

TikTok is among the world’s most popular social media platforms, with more than 150 million users in the United States, many of whom get their news primarily from the platform.

That popularity, combined with the possibility that the platform could receive editorial direction from the CCP, creates an imminent threat, according to Ms. Blackburn and others in Congress.

It is unclear how much indirect control the CCP retains over ByteDance and TikTok. However, the regime purchased a “golden share” in ByteDance’s Chinese subsidiary in 2019, which could allow it to influence how the company’s board votes on key decisions. A golden share is usually a small amount of shares, but the stake gives the owner special voting powers, including veto power.

There are also growing indicators that some influencers on the platform are coordinating with the regime, according to Chihhao Yu, co-director of the Taiwan Information Environment Research Center.

Pro-CCP propaganda is now beginning to appear on TikTok in some instances before being published on Douyin, the version of the app available in China.

“Some of these TikTok videos are published before their Douyin counterparts by [Chinese] state media,” Mr. Yu said during an April 8 talk in Washington.

“So that’s an even stronger signal, indicating that these influencers on TikTok are having at least some kind of coordination with [Chinese] actors.”

Still, Mr. Yu said that the proliferation of misinformation and foreign influence operations online isn’t unique to TikTok. Instead, he said, it’s one problem among several.

“There are two more things: the top one is personal data security, and No. 2 is the addictiveness of the platform,” Mr. Yu said.

A man walks past a restaurant with a TikTok logo displayed in the window in Beijing on Sept. 14, 2020. (Greg Baker/AFP via Getty Images)
A man walks past a restaurant with a TikTok logo displayed in the window in Beijing on Sept. 14, 2020. (Greg Baker/AFP via Getty Images)

Data Security

Ms. Blackburn likewise believes that the foremost threat posed by TikTok is that ByteDance is required by law in China to provide any data it has to the CCP upon request, including whatever sensitive personal information it may have collected on Americans through TikTok.

“TikTok’s parent company, ByteDance, is tied to the Chinese Communist Party by strict laws in Beijing that force companies to hand over users’ personal data,” Ms. Blackburn said.

Federal Communications Commission Commissioner Brendan Carr warned that TikTok is being used to collect troves of information on millions of American users, including “search and browsing history, keystroke patterns, biometrics, and location information.”

“At the end of the day, any entity that is inside of China, particularly if they’re a CCP member, is compelled by a national security law in China to do the bidding of the CCP surveillance apparatus and to keep it secret,” Mr. Carr said during a recent interview with EpochTV’s “American Thought Leaders.”

Indeed, the most recent version of the TikTok legislation was crafted in large part due to the threat posed by China’s security laws.

Rep. Mike Gallagher (R-Wis.), who chairs the influential House Select Committee on Strategic Competition with the CCP, said that’s why the bill includes language to force the divestiture of any social media company believed to be under the control of U.S. foes.

“This bill is squarely focused on preventing foreign adversaries—China, Russia, North Korea, and Iran—from controlling social media apps in the U.S.,” Mr. Gallagher told The Epoch Times.

“Under ByteDance’s ownership structure, the Chinese government not only has the ability to surveil Americans’ user data but also manipulate TikTok’s algorithm and conduct influence operations on Americans’ ‘For You’ pages,” he said.

“We simply cannot continue to allow an app controlled by our nation’s foremost adversary to take over the American media landscape.”

(Top) Rep. Raja Krishnamoorthi (D-Ill.) (L) and Rep. Mike Gallager (R-Wis.) talk with reporters after the House voted to ban TikTok if it remains under Chinese ownership, at the U.S. Capitol on March 13, 2024. (Bottom) A person arrives at the offices of TikTok in Culver City, Calif., on March 13, 2024. (Chip Somodevilla/Getty Images, Mike Blake/Reuters/File Photo)
(Top) Rep. Raja Krishnamoorthi (D-Ill.) (L) and Rep. Mike Gallager (R-Wis.) talk with reporters after the House voted to ban TikTok if it remains under Chinese ownership, at the U.S. Capitol on March 13, 2024. (Bottom) A person arrives at the offices of TikTok in Culver City, Calif., on March 13, 2024. (Chip Somodevilla/Getty Images, Mike Blake/Reuters/File Photo)

Opposition to TikTok Ban Grows

TikTok has painted the bill as a targeted ban on its operations and an assault on freedom of speech.

“This bill is an outright ban of TikTok, no matter how much the authors try to disguise it,” a TikTok spokesperson told The Epoch Times in an email. “This legislation will trample the First Amendment rights of 170 million Americans and deprive 5 million small businesses of a platform they rely on to grow and create jobs.”

Opposition to the effort against TikTok is also growing in Congress, with a small but bipartisan minority in both chambers expressing numerous concerns about the legislation.

Speaking during the House vote on the legislation, Rep. Thomas Massie (R-Ky.) suggested that the bill could become a “Trojan horse” for perpetual overreach from the executive branch as it would empower the president to force the sale of social media companies deemed even indirectly influenced by foreign powers.

“I know the sponsors of this bill are sincere in their concerns and in their effort to protect Americans,” Mr. Massie said.

“[But] We don’t need to be protected by the government from information.”

There is also the question of whether the U.S. intelligence community has independently verified any of the claims that the CCP has directed the promotion or suppression of content on TikTok through ByteDance.

To date, the only claims that the intelligence community has openly made regarding CCP involvement with ByteDance or TikTok have been confined to statements previously made in U.S. media reports that have relied on anonymous sources.

For this reason, Ms. Blackburn and many others in Congress have requested that their classified briefings on the subject be made public.

Some, however, have suggested that declassification wouldn’t unveil a unique threat.

Rep. Sara Jacobs (D-Calif.) said prior to the House vote that “not a single thing” Congress has heard in its classified security briefings is unique to TikTok, but pervades all social media.

Mr. Massie also highlighted numerous contentions about the bill’s premise and legality, including the fact that Bytedance is not actually owned by the CCP or even majority-owned by Chinese investors, that the bill has no sunset clause, and that the bill would require all appeals to be handled through the District of Columbia Court of Appeals rather than the states.

There is also the issue of whether the bill is lawful, given its reliance on presidential authority, an issue that several lawmakers, including Rep. Jim Himes (D-Conn.) and Sen. Rand Paul (R-Ky.), have spoken about.

That’s because the Cold War-era Berman Amendments revoked the Executive Office’s authority to ban or regulate the free flow of any “informational materials” to American citizens, including foreign propaganda.

Rep. Robert Garcia (D-Calif.) speaks at a news conference on TikTok in Washington on March 12, 2024. House Democrats and TikTok creators held the news conference to express their concern over legislation that would force the owners of the popular Chinese social media app to sell the platform or face a ban in the United States. (Anna Moneymaker/Getty Images)
Rep. Robert Garcia (D-Calif.) speaks at a news conference on TikTok in Washington on March 12, 2024. House Democrats and TikTok creators held the news conference to express their concern over legislation that would force the owners of the popular Chinese social media app to sell the platform or face a ban in the United States. (Anna Moneymaker/Getty Images)

“One of the key differences between us and those adversaries is the fact that they shut down newspapers, broadcast stations, and social media platforms. We do not,” Mr. Himes said.

“We trust our citizens to be worthy of their democracy. We do not trust our government to decide what information they may or may not see.”

What’s Next?

For now, the bill’s future remains uncertain, though it’s clear it won’t sail through the Senate with the speed that it did the House.

During his last days in office, Mr. Gallagher is playing the role of an unofficial whip, urging the Senate to take up the legislation as quickly as possible for fear that the CCP could use TikTok to promote propaganda ahead of the U.S. election cycle.

“This bill passed in overwhelming fashion with 352 votes in the House of Representatives, which I have not seen on something this important in my eight years in Congress,” Mr. Gallagher said.

“This level of support makes it impossible for the Senate to ignore. The White House has signaled that they will sign the bill if and when it passes the Senate, and I know Leader Schumer is very concerned about the threat posed by the Chinese Communist Party,” he said.

Reflecting on Taiwan’s recent experience with CCP election interference, Mr. Yu acknowledged the threat posed by the regime’s influence on social media.

Noting his three major concerns—CCP influence, data security, and addictiveness—he concluded that the freedom to speak and share ideas should not be curbed. Instead, he said, the problem of CCP misinformation would be solved by encouraging the exchange of debate and ideas rather than eliminating it.

“I think we need to address all [the] three big problems of TikTok and maybe, by extension, all social media platforms and what all these tech tools are doing to our democratic processes,” Mr. Yu said.

“Freedom of speech is why we do this—because we want a healthy democracy. It’s not because we want to get rid of something when we don’t want something in our country. We want a healthy functional debate of our country’s direction.”

Modified RNA in COVID Vaccines May Contribute to Cancer Development: Review

 Modified RNA in COVID Vaccines May Contribute to Cancer Development: Review 

The mRNA used in the COVID-19 vaccines differs from naturally occurring mRNA, which has been modified to prevent immune degradation when injected. In a review published on April 5, researchers argue that modification—specifically, N1-methyl-pseudouridine modification—to mRNA causes immune suppression that may contribute to cancer development.
Uridine is a key component of mRNA. However, when mRNA is injected into the body, it is broken down by cells and also triggers a broad immune response, leading to its rapid degradation.
This immune response can be bypassed: researchers Katalinko Kariko, Ph.D., and Dr. Drew Weissman found that when uridine is modified to N1-methyl-pseudouridine (m1-psi), the mRNA is not degraded and proteins can be produced. The two were awarded a 2023 Nobel award for their findings.

Pfizer and Moderna therefore used this patented technology to ensure that the mRNA vaccines would be able to produce spike protein inside cells.
However, research suggests this modification may reduce immune responses. “Within the framework of COVID-19 vaccination, this inhibition ensures an appropriate spike protein synthesis and a reduced immune activation,” the authors wrote in the study’s abstract.
The authors are concerned the modification may promote cancer in susceptible individuals.
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“We suggest that future clinical trials for cancers or infectious diseases should not use mRNA vaccines with a 100% m1Ψ (m1-psi) modification, but rather ones with the lower percentage of m1Ψ modification to avoid immune suppression,” they wrote.

Modified vs. Natural RNA

Modified and natural RNA stimulate different responses in the body. Modified RNA tends to produce more aberrant proteins, potentially contributing to cell genome instability.
Most importantly, modified RNA induces a more muted response in the body than natural RNA, which may have broad implications for the body’s ability to fight other infections and cancers.
The authors cited studies finding that natural RNA tended to stimulate the activity of type-1 interferon—a key anti-tumor substance—and other immune chemicals. Contrastingly, modified RNA stimulates a milder response and is associated with immune chemicals that promote tolerance of foreign RNA injections.
An earlier study found RNA containing modified uridine failed to activate a pathway known to be involved in detecting viral infections and fighting cancers.
They also cited Ms. Kariko and Dr. Weismann’s paper which found mRNA modification suppressed immune recognition and activation of immune cells. The authors argue that this was a double-edged sword, due to wide-reaching immune consequences.
A critical piece of evidence the review authors cited comes from a mice study in Thailand.
In the study, researchers injected natural mRNA and 100 percent modified RNA into two different groups of mice with melanoma.
The Thai researchers found that when injected with natural RNA, the body had a more robust immune response than when injected with modified RNA.
Furthermore, the prognosis of the melanoma mice also differed.
The survival rate in the mice group without modified RNA was 100 percent. Conversely, in the group with the modified uridine, only half of the mice survived.
In their abstract, the Thai researchers wrote that an mRNA vaccine induces type-1 interferon production and downstream signals crucial for controlling tumor growth and metastasis.
The review authors interpreted the findings to mean that adding 100 percent of “[m1-psi] to the mRNA vaccine in a melanoma model stimulated cancer growth and metastasis, while non-modified mRNA vaccines induced opposite results.”
They added that the study potentially shows that complete mRNA modification reduced survival in recipients.

The Cancer Debate

However, Tanapat Palaga, who has a doctorate in microbiology and immunology, is a professor of microbiology at Chulalongkorn University in Bangkok, Thailand, and is the senior author of the Thai study, told The Epoch Times in an email that the review took his team’s “results out of the context.”
While the senior author agreed that the unmodified RNA is associated with “robust anti-tumor immunity,” he added that their study “did not indicate, conclude or suggest that modified mRNA promotes tumor formation.
“Modified RNA ... just simply did not induce IFN type I production,” he wrote.
The review authors were careful to highlight that they are not suggesting that modified RNA causes cancer but that its effects may lead to an environment that aids in the development of cancers.
“Those who do not read in depth will be quick to say that we are AFFIRMING that mRNA vaccines cause cancer,” the review authors wrote to The Epoch Times in an email, pointing to a passage in their paper stating, “It is important to clarify here that mRNA vaccines do not cause cancer; but they could stimulate its development ... We are more concerned with experimental and clinical data with regard to the latter.”
Dr. Tian Xia, a professor in the Division of NanoMedicine at the University of California–Los Angeles, told The Epoch Times that the basis of m1-psi is to reduce immunotoxicity “not to suppress the innate and adaptive immunity,” and the cancer-causing conclusion doesn’t have “strong scientific support.”

Reduce Modified RNA Use

The review authors suggested that mRNA therapeutics should include a “lower percentage” of modified RNA in the future.
They also wrote that they do not discourage the use of mRNA injections in cancer treatment, given that natural or unmodified RNA reduces tumor growth, improves the efficiency of immune responses, and may potentially increase survival.
The authors told The Epoch Times that with COVID-19 mRNA vaccines, the scientists “only focused on maximizing the production of the spike protein” without considering other downstream effects.
“We have to do a deep reflection here: if you lower the [percentage] of modification, you have a less effective vaccine against SARS-CoV-2,” the authors wrote, but at the same time, there may be fewer unintended adverse effects.
Raquel Valdes Angues, a senior research associate at Oregon Health & Science University, told The Epoch Times that she and her colleagues welcome the review “addressing the potential implications of using COVID-19 [m1-psi]-modified mRNA vaccines on cancer progression and metastasis.”
She highlighted that modified RNA has been shown to impede interferon signaling, and given its complex role in tumor biology, “it becomes imperative to exercise caution when integrating modified [m1-psi] mRNAs for therapeutic use” in live animals and humans.
“These considerations warrant thorough investigation and thoughtful deliberation in the pursuit of mRNA-based therapeutics,” she said.

Friday, April 5, 2024

Magnitude 4.8 earthquake felt across New Jersey, New York

Biden Admin Installs New Rule Making It Harder to Fire Bureaucrats 

The Biden administration has issued a new rule that makes it harder to fire government employees in an apparent bid to thwart former President Donald Trump’s pledge to fire “rogue bureaucrats” and radically reshape the federal workforce.

The new rule, which bolsters job protections for career civil servants, was issued on April 4 by the U.S. Office of Personnel Management (OPM), which hinted in a statement that it’s targeting a promised move by a potential second Trump presidency to “drain the swamp and root out the deep state” by making it easier to fire government workers.

“In the first week of the Biden-Harris Administration, President Biden revoked an Executive Order issued by the previous Administration that risked altering our country’s long-standing merit-based civil service system, by creating new excepted service schedule, known as ‘Schedule F,’ and directing agencies to move potentially large swathes of career employees into this new excepted service status,” OPM said in the statement.

This is in reference to a Trump-era executive order issued in 2020 that allowed tens of thousands of the 2.2 million federal employees to be reclassified as political appointees, making it easier to fire them.

‘Root Out the Deep State’

Roughly 4,000 federal employees are now considered political appointees, who typically change with each administration, with the revival of a Schedule F potentially increasing that more than tenfold.

President Joe Biden nixed the Schedule F order when he took office, while President Trump said in mid-2022 that he would try to revive the concept in one form or another.

“We need to make it much easier to fire rogue bureaucrats who are deliberately undermining democracy or at a minimum just want to keep their jobs,” President Trump said in a speech at the America First Policy Institute on July 26, 2022, promising to “drain the swamp and root out the deep state.”

The former president went further in his speech, calling on Congress to pass laws that would give the commander-in-chief the authority to fire any government employee basically at will.

“Congress should pass historic reforms empowering the president to ensure that any bureaucrat who is corrupt, incompetent, or unnecessary for the job can be told ‘you are fired, get out,’” he said, adding that, after such reforms, Washington would be an “entirely different place.”

Later on the campaign trail, President Trump repeatedly hinted at his intention to make good on this promise. His remarks dovetail with a long-standing desire on the part of many Republicans to prune what they say is a bloated, inefficient and, in many cases, counterproductive federal bureaucracy.

Many Democrats, on the other hand, see the potential revival of a Schedule F or similar initiative as a threat to the operations of government and a potential disruption to the provision of critical services.

“This final rule honors our 2.2 million career civil servants, helping ensure that people are hired and fired based on merit and that they can carry out their duties based on their expertise and not political loyalty,” OPM Director Kiran Ahuja said in a statement.

“The Biden-Harris Administration is deeply committed to the federal workforce, as these professionals are vital to our national security, our health, our economic prosperity, and much more.”

Vice President Kamala Harris applauds as President Joe Biden delivers the State of the Union address in the House Chamber of the U.S. Capitol on Feb. 7, 2023. (Jacquelyn Martin/Pool/AFP via Getty Images)
Vice President Kamala Harris applauds as President Joe Biden delivers the State of the Union address in the House Chamber of the U.S. Capitol on Feb. 7, 2023. (Jacquelyn Martin/Pool/AFP via Getty Images)

The new rule, which is nearly 240 pages long, apparently seeks to put up a roadblock to prevent President Trump, or anyone else for that matter, from issuing another executive order that would reclassify civil servants.

The White House didn’t respond to a request for comment by press time.

Trump campaign spokesperson Karoline Leavitt pointed to President Trump’s Agenda 47 plan to “dismantle the deep state and return power to the American people,” which includes an explicit pledge to re-issue the 2020 executive order, “wield that power aggressively,” and “fire rogue bureaucrats.”

What’s in the New Rule?

The rule, which is being published in the federal registry and is set to take effect next month, is poised to counter a future Schedule F executive order by entrenching the status and civil service protections accrued by federal employees.
It stipulates that the job protections accrued by a government worker cannot be taken away by an involuntary move from the competitive service (appointments that are subject to OPM hiring rules and pay scales) to the excepted service (appointments that follow a separate, often more streamlined hiring process).

Similarly, moves from one excepted service schedule to another would not strip federal employees of those protections under the new rule.

“Once a career civil servant earns protections, that employee retains them unless waived voluntarily,” the OPM said in a statement.

The rule also makes clear that policymaking classifications apply to noncareer and political appointments and cannot be applied to career civil servants.

Specifically, the new rule stipulates that the phrase “confidential, policy determining, policymaking, or policy-advocating” positions (which describe positions lacking civil service protections) can be used to refer only to noncareer, political appointments and may not be applied to career civil servants to strip them of protections.

The final rule also establishes new procedural requirements for moving positions from the competitive service to the excepted service and within the excepted service. In particular, it creates an appeals process for federal employees when any such movement is involuntary and involves stripping workers of their civil service protections.

“This final rule builds on three years of the Biden-Harris Administration’s efforts to strengthen federal agencies and the federal workforce,” OPM Deputy Director Rob Shriver said in a statement.

The agency said it had reviewed more than 4,000 comments submitted during the public comment period as part of the rulemaking process.