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Ukraine war pushes Brazil toward natural fertilizers

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A tractor sprays stone dust in a field next to a pile of stone dust at the Vargem Dourada farm in Padre Bernardo, Goias State, Brazil on May 19, 2022
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Fearing Russia’s invasion of Ukraine will disrupt its crucial supply of fertilizer imports, agricultural powerhouse Brazil is increasingly turning to natural alternatives.

Brazil, a top producer of soy, corn, cotton, sugarcane and coffee, is the world’s fourth-biggest consumer of so-called “NPK” chemical fertilizers — nitrogen-, phosphorus- and potassium-based.

It imports around 80 percent of its total supply — and 25 percent of that from Russia, whose exports have now been targeted by Western sanctions over the Ukraine invasion.

That is causing farmers in the South American giant to turn to alternatives, including remineralizers, or “agrominerals” — pulverized, nutrient-rich rocks that are spread on fields before planting.

Brazil, which authorized remineralizers for agricultural use in 2013, is the world leader in the technique, which is also used in the United States, Canada, India and France, among others.

“Brazil is a tropical country, and the rains tend to wash away soil nutrients. Rock powder rebuilds the soil and renews it,” says Marcio Remedio, mineral resources director at the Brazilian Geological Service.

The technique also “allows plants’ roots to develop better and capture the nutrients they need to grow,” says Suzi Huff Theodoro, a geologist at the University of Brasilia.

“We have rocks with the right profile in various parts of the country, and the cost is significantly cheaper” than chemical fertilizers, she told AFP.

– Beyond chemicals –

A study last year found around five percent of farmland in Brazil used remineralizers.

That figure looks set to jump this year: the country’s 30 suppliers report they are seeing unprecedented demand, says Theodoro.

“Most of them have already sold their entire output for the year, to all kinds of farms — from industrial to mid-sized to small and mostly ecologically minded,” she says.

Farmer Rogerio Vian has almost stopped using chemical fertilizers altogether.

Vian, who runs a 1,000-hectare (nearly 2,500-acre) soy and corn farm in the central-western state of Goias, was an early adopter of alternative technologies.

He started out nine years ago making his own products from microorganisms found in native forests.

He pulverized them and applied them while planting to protect against parasites and help his crops absorb nutrients.

Now Vian, who founded the 700-member Association for Sustainable Agriculture (GAAS), is using remineralizers, too.

“I’ve cut my fertilizer and seed treatment costs by 50 percent, with no loss of productivity,” he says.

“Brazil is a mega-biodiverse country, and that holds enormous potential in terms of tools and techniques for our work, which we’re only just starting to discover.”

– ‘Unstoppable change’ –

Brazil will still be using NPK fertilizers for the foreseeable future, but it could dramatically reduce its dependence on foreign suppliers, says researcher Jose Carlos Polidoro of the state-owned Brazilian Agricultural Research Corporation (Embrapa).

“Organic and organomineral fertilizers — made with mining residue, organic agro-industrial residue and sewage sludge — account for five percent of the Brazilian fertilizer market today,” he says.

“But they have the potential to reduce our imports by 20 percent.”

Another fast-growing technique: treating crops with rhizobacteria, which draw nitrogen from the air and deliver it directly to plants, helping them grow — and reducing the consumption of industrial nitrogen-based fertilizers.

Not that the farmers rapidly adopting these products have an easy row to hoe.

“Farmers are running into difficulty finding financing to invest more, and there’s a shortage of technical assistance available,” says Carlos Pitol, an agricultural consultant in the central-western state of Mato Grosso do Sul and a member of GAAS.

“But the change in the production system is growing, and it’s unstoppable.”

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Asian markets rise as recession talk tempers rate hike expectations

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Growing talk of a recession has led investors to temper their expectations for central bank rate hikes
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Stocks rose in Asia on Friday following another rally on Wall Street as investors try to process central bank moves to fight soaring inflation with the growing possibility that those measures will induce a recession.

Global markets have been thrown into turmoil for months by a perfect storm of crises that have left observers predicting a sharp contraction, including the Ukraine war, China’s lockdown-induced economic troubles, supply chain snarls and spiking energy costs.

Expectations that the Federal Reserve and other central banks will have to keep lifting rates have left many traders fretting that the pain could go on for some time, with sovereign bond yields — key gauges to future rates — continuing to climb.

This week Fed boss Jerome Powell told lawmakers a recession was “certainly a possibility” and suggested officials were ready to press on with big rate hikes, following a three-quarter point lift this month.

However, analysts said speculation that a recession is on the way has helped push yields down in recent days and led traders to scale back their expectations for the length of rate hikes.

Demand concerns have also helped send oil prices — a key driver of inflation — lower with both main contracts around 15 percent over the past week.

Added to the mix this week are comments from President Xi Jinping suggesting an end to China’s tech crackdown as well as possible new measures aimed at boosting the economy.

“As we have been saying for some time now, for stocks to return to any semblance of form, it would likely require an unlikely upbeat mix of a seamless China growth recovery, a top in US bond yields, and much softer oil prices,” said Stephen Innes at SPI Asset Management.

“While a tall order and still a near-term unlikely combination scenario, the fall in commodity prices, especially oil, should be music to the Fed’s ears, so some could be ticking one or two of those boxes off.”

In early Asia trade investors took their cue from Wall Street, where all three main indexes closed with healthy gains, including a more than one percent advance on the Nasdaq.

Hong Kong, Tokyo, Shanghai, Sydney, Seoul, Singapore, Taipei, Manila and Jakarta were well up.

Markets are negotiating “a fraught transition from ‘front-loaded’ synchronised tightening towards demand destruction and peak ‘price-pressure’,” Citigroup Inc. strategists William O’Donnell and Edward Acton wrote in a note.

– Key figures at around 0230 GMT –

Tokyo – Nikkei 225: UP 0.7 percent at 26,362.24 (break)

Hong Kong – Hang Seng Index: UP 1.1 percent at 21,499.82

Shanghai – Composite: UP 0.7 percent at 3,343.83

Dollar/yen: DOWN at 134.84 yen from 134.94 yen late Thursday

Pound/dollar: UP at $1.2277 from $1.2259

Euro/dollar: UP at $1.0533 from $1.0526

Euro/pound: DOWN at 85.78 pence from 85.80 pence

West Texas Intermediate: UP 0.1 percent at $104.34 per barrel

Brent North Sea crude: DOWN 0.1 percent at $110.05 per barrel

New York – Dow: UP 0.6 percent at 30,677.36 (close)

London – FTSE 100: DOWN 1.0 percent at 7,020.45 (close)

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Major US banks can weather severe economic downturn: Fed

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The largest banks operating in the US market have sufficient resources to withstand a severe economic downturn, the Federal Reserve says
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The largest banks operating in the US market have sufficient resources to withstand a severe economic downturn and continue providing financing to American families and firms, the Federal Reserve said Thursday.

The Fed subjected 33 banks to its annual “stress test” exercise, to gauge whether they would be able to weather a steep global recession.

In the hypothetical crisis, financial markets plummet, commercial real estate and corporate debt markets face substantial strain, US unemployment reaches 10 percent and the economy contracts by 3.5 percent.

The results “showed that banks continue to have strong capital levels, allowing them to continue lending to households and businesses during a severe recession,” the Fed said. 

The scenario for this year’s test was even bleaker than the one used last year, but the outcome was the same, showing all the banks would maintain a sufficient “cushion” despite total projected losses of $612 billion, according to the report.

“Despite the larger post-stress decline this year… capital ratios remain well above the required minimum levels throughout the projection horizon” of nine quarters, the report said.

The stress tests, implemented in the wake of the 2008 global financial crisis, apply to banks with at least $100 billion in total assets, including the top tier designated as “global systemically important banks.”

Smaller banks are only subjected to the stress tests every two years, so the results are not directly comparable to 2021, which tested 23 institutions.

Among the banks examined in both years, there were an additional $50 billion in losses under the tougher scenario, a Fed official told reporters.

However, the official stressed that the dire case applied is only hypothetical and not a forecast.

With the results in hand, banks can announce any plans for dividend payments and share buybacks starting Monday at 2030 GMT, the official said.

The Fed ordered limits to such distributions in June 2020 as the coronavirus pandemic caused a sharp economic downturn, but relaxed the restrictions in December 2020 before removing them following last year’s tests.

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Apple, Android phones targeted by Italian spyware: Google

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Google says spyware was slipped onto smartphones in Italy and Kazakhstan with the help of mobile interent service providers who cut off service so users could be tricked with messages offering to fix the problem.
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An Italy-based firm’s hacking tools were used to spy on Apple and Android smartphones in Italy and Kazakhstan, Google said Thursday, casting a light on a “flourishing” spyware industry.

Google’s threat analysis team said spyware made by RCS Lab targeted the phones using a combination of tactics including unusual “drive-by downloads” that happen without victims being aware.

Concerns over spyware were fueled by media outlets reporting last year that Israeli firm NSO’s Pegasus tools were used by governments to surveil opponents, activists and journalists.

“They claim to only sell to customers with legitimate use for surveillanceware, such as intelligence and law enforcement agencies,” mobile cybersecurity specialist Lookout said of companies like NSO and RCS.

“In reality, such tools have often been abused under the guise of national security to spy on business executives, human rights activists, journalists, academics and government officials,” Lookout added.

Google’s report said the RCS spyware it uncovered, and which was dubbed “Hermit”, is the same one that Lookout reported on previously.

Lookout researchers said that in April they found Hermit being used by the government of Kazakhstan inside its borders to spy on smartphones, just months after anti-government protests in that country were suppressed.

“Like many spyware vendors, not much is known about RCS Lab and its clientele,” Lookout said. “But based on the information we do have, it has a considerable international presence.”

– Growing spyware industry –

Evidence suggests Hermit was used in a predominantly Kurdish region of Syria, the mobile security company said.

Analysis of Hermit showed that it can be employed to gain control of smartphones, recording audio, redirecting calls, and collecting data such as contacts, messages, photos and location, Lookout researchers said.

Google and Lookout noted the spyware spreads by getting people to click on links in messages sent to targets.

“In some cases, we believe the actors worked with the target’s ISP (internet service provider) to disable the target’s mobile data connectivity,” Google said.

“Once disabled, the attacker would send a malicious link via SMS asking the target to install an application to recover their data connectivity.”

When not masquerading as a mobile internet service provider, the cyber spies would send links pretending to be from phone makers or messaging applications to trick people into clicking, researchers said.

“Hermit tricks users by serving up the legitimate webpages of the brands it impersonates as it kickstarts malicious activities in the background,” Lookout researchers said.

Google said it has warned Android users targeted by the spyware and ramped up software defenses. Apple told AFP it has taken steps to protect iPhone users.

Google’s threat team is tracking more than 30 companies that sell surveillance capabilities to governments, according to the Alphabet-owned tech titan.

“The commercial spyware industry is thriving and growing at a significant rate,” Google said.

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