Shock decision: China closes border to coal imports from Mongolia www.news.mn

China has suspended coal imports until the end of 2018 through all its border crossings. Beijing explained that coal imports had already met the country’s demand. This year, China has planned to import coal equivalent to last year’s volume. That target has already been met. According to observers, China made this decision after reserving enough coal for six power stations; the announcement was made during an acrimonious meeting with senior Australian representatives.

Strategy introduced to foster private sector in western Mongolia www.montsame.mn

Ulaanbaatar/MONTSAME/ A discussion themed ‘Strategy to foster private sectors in western Mongolia’ was held at State House on November 19.

Mongolia to strengthen economic ties with Russia www.xinhuanet.com

ULAN BATOR, Nov. 19 (Xinhua) -- Mongolia is willing to further strengthen ties with Russia in the fields of economy, trade and investment, deputy speaker of the Mongolian parliament Luvsantseren Enkh-Amgalan said Monday.

Volkswagen to spend $50 billion on electric car 'offensive' www.cnn.com

London (CNN Business)Volkswagen has committed to spending tens of billions of dollars as part of a dramatic shift to electric and autonomous vehicles.

Habitability of Mongolia under threat from climate change www.adelaidenow.com.au

There are fears one of the world's oldest cultures may be wiped out by the effects of climate change. Substantial temperature changes and extreme weather events in Mongolia have been blamed for the deaths of thousands of livestock in recent years. It’s believed to be forcing hundreds of families to abandon their traditional nomadic farming methods per year. Mongolians are pleading for international climate action as world leaders prepare for the UN climate conference in December.

The Surprise Fuel Flows Sparked by a Raging U.S.-China Trade War www.bloomberg.com

A Southeast Asian nation that was a bit player in the biofuel market is suddenly buying and selling unprecedented supplies. The U.S.-China trade war may have something to do with it.

Malaysia has emerged to displace the U.S. as the biggest supplier of ethanol to China in just two months. It’s also the first time the Southeast Asian country is selling such significant volumes to the world’s top consumer. At the same time, it’s buying a record amount of the fuel from America.

The hook? The shift occurred after President Xi Jinping imposed tariffs on U.S. ethanol imports in retaliation to American counterpart Donald Trump’s duties on Chinese goods. While the two countries apply tit-for-tat levies, shipments from Malaysia to China are tax free.

The dispute between the world’s two largest economies has roiled markets from consumer goods to soybeans, but rarely has a completely new player emerged to fill in a supply gap. The sudden spike in the flows in and out of Malaysia has taken traders by surprise, according to Heather Zhang, a Singapore-based analyst who follows the global biofuel industry at researcher PRIMA.

“It’s an interesting opportunity,” Zhang said. “It shows some merchants are enthusiastic in their effort to generate profitability and adapt to change in the international trading environment during this unusual trade war event.”

Questionable Demand
There is no significant production or use of fuel ethanol in Malaysia, the U.S. Department of Agriculture said in a report in October last year. It’s not produced commercially as the feedstock is expensive to transport, and it’s also excluded as a source of alternative fuel under the Southeast Asian nation’s biofuel policy, according to the USDA.

For China, demand for the renewable fuel is growing after the world’s largest automobile market announced an ambitious plan to expand the use of ethanol gasoline for vehicles nationwide by 2020. Weaning itself off from U.S. biofuel may be a challenge it struggles to meet given the lack of domestic production capacity, as well as higher prices from suppliers elsewhere.

How Much?
Malaysia bought about 97 million liters of ethanol this year from the U.S., mostly in August and September, for a total $35 million, or 36 cents a liter, according to the USDA.

China purchased a total 88 million liters of ethanol, labeled as ethyl alcohol in import data, during August and September from Malaysia, compared with zero inbound shipments in the first seven months of this year. The total value of the purchase reported to Chinese authorities was about $49 million, or 56 cents a liter.

Meanwhile, shipments from America to China plunged to just over 13 thousand liters in the quarter ended Sept. 30. China’s price per liter for U.S. ethanol was about 44 cents a liter. Now that would be subject to tariffs including a 25 percent levy imposed in July, a 15 percent tax adopted in April, and a 30 percent tariff on all ethanol imports. The prices reported to Chinese customs and the USDA exclude duties.

While a direct transfer of U.S. ethanol via Malaysia to China would be in breach of China’s tariff rules, the product can be labeled as originating in the Southeast Asian nation if it’s blended with at least 40 percent locally produced fuel before the resale. China already offers preferential levies to qualified products originating from ASEAN countries including Malaysia, and is also looking to finalize a 16-nation trade bloc deal in 2019.

“The market is curious whether the flow will persist and eventually develop Southeast Asia as a sustainable emerging hub,” Zhang said.

Still, some market participants have raised red flags over the sustainability of the new flows, according to a PRIMA report in August. They suspect there is not enough ethanol production capacity in Malaysia for such a trade to seem legitimately viable for long, PRIMA said, cited industry discussions.

“The industry understands that ethanol production in Malaysia is limited, and the country doesn’t consume ethanol either,” Zhang said. “This change has subverted many people’s perception of the fundamentals.”

Mongolia’s coal exports in first 10 months up 10pc www.xinhuanet.com

ULAN BATOR (Xinhua) – Mongolia’s coal exports in the first ten months of the year totalled 31.3 million tonnes, up 10 per cent year on year, official statistics showed Saturday.

About 100 thousand passengers passed through Mongolia-Xinjiang border www.montsame.mn

Ulaanbaatar /MONSTAME/ The 2018 plenary meeting of auto transport representatives of Mongolia and the Xinjiang Uygur Autonomous Region of China was organized by the National Auto Transportation Center in Ulaanbaatar.

China's ‘One Belt, One Road’ global investment plan mapped out www.rt.com

Asia summit ends in historic failure www.cnn.com

(CNN)For the first time in its 25-year history, the Asia-Pacific Economic Cooperation summit ended Sunday with its leaders failing to agree on a formal joint statement.

All 21 APEC leaders at the annual meeting in Papua New Guinea were in agreement except China, a source within the meeting told CNN.
Canadian Prime Minister Justin Trudeau confirmed late Sunday that disagreements on trade stood in the way of a final statement.

"There are differing visions on particular elements," Trudeau said.
China may have been concerned about a specific line about unfair trade practices, according to a US official involved in the negotiations.
The official said the most "problematic" line for the Chinese was: "We agree to fight protectionism including all unfair trade practices."

"They seemed to think that the 'unfair trade practices' was some kind of singling out," the official contended.
"It's a little concerning that it appears that China didn't really have any intention in the end of reaching consensus," the official said.
The trade war between the US and China was at the forefront during speeches by Chinese President Xi Jinping and US Vice President Mike Pence on Saturday.

Xi spoke of the need for global cooperation and trade and said all differences could be bridged "through consultation."
"History has shown that confrontation, whether in the form of a cold war, a hot war or a trade war, will produce no winners," Xi said to applause.
But Pence said Washington wouldn't ease the trade war with Beijing until it "changes its ways."
"China has taken advantage of the United States for many, many years and those days are over," Pence told the gathering in Port Moresby.
The Trump administration has levied tariffs on $250 billion in Chinese products since July. The tariffs on $200 billion of those goods are set to increase to 25% from 10% on January 1, which would further escalate the conflict.

China has so far retaliated with tariffs on $110 billion of US products and is likely to respond with more if the United States goes ahead with the increase at the start of January.
Pence also knocked China for loans to developing countries in the Pacific and beyond.
"The terms of those loans are often opaque at best. Projects they support are often unsustainable and of poor quality. Too often, they come with strings attached and lead to staggering debt... The United States deals openly, fairly. We do not offer a constricting belt or a one-way road," he said, mocking China's One Belt, One Road initiative.
China's Foreign Ministry lashed out at Pence for his remarks.
"Our advice for the relevant country is that instead of pointing fingers at others, it would be better to match its deeds with its words and truly treat all countries, big or small, as equals," Chinese Foreign Ministry spokeswoman Hua Chunying said in a statement.
"Not a single developing country has been mired in debt difficulties because of its cooperation with China. On the contrary, their cooperation with China has helped them enhance their capacity for self-driven development and improved their people's livelihood," Hua said about Pence's allegations on loans.
US admiral: 'Great Wall of SAMs'
Further fanning the flames, Pence announced the US would partner with Australia and Papua New Guinea to develop a naval base on Manus Island in Papua New Guinea.

Pence did not give details of the development of the base, but the announcement comes as Washington is trying counter a substantial Chinese military buildup in the South China Sea and beyond.
Most of the region's attention was focused on Port Moresby. The US military commander in the Pacific, speaking at a conference in Canada, accused China's military of "a sustained campaign to intimidate other nations in the East and South China Seas" by fortifying manmade islands.

US Navy ship, Chinese destroyer nearly collide 02:16
"What was a 'Great Wall of Sand' just three years ago is now a 'Great Wall of SAMs' (surface-to-air missiles) in the South China Sea," Adm. Phil Davidson told the Halifax International Security Forum in Nova Scotia.
Davidson said the islands and the armaments on them give Beijing "the potential to exert national control over international waters and airspace through which over $3 trillion in goods travel every year, along with commercial air traffic."
China says its installations on the South China Sea islands are necessary to protect its territory and has criticized repeated US naval and air operations near the islands.
"Some countries, which are outside of the region, ignore China's firm opposition and conduct reconnaissance in the name of 'freedom of navigation,' show off military power, threaten China's sovereignty and the safety of Chinese stationed staff, which could easily cause marine and air accidents, and damage regional peace and stability," China's Foreign Ministry said in a statement sent to CNN in August.
But Davidson said it was China that posed a threat to sovereign rights with military intimidation.
"They're now violating the sovereignty of every other nation's ability to fly, sail, and operate in accordance with international law," Davidson said.