Mongolian central bank's purchase of gold expected to decrease in 2019 www.xinhuanet.com

ULAN BATOR, Jan. 5 (Xinhua) -- The Bank of Mongolia's purchase of gold is expected to decrease in 2019, the central bank's spokesperson said Saturday.

Law-making process freezes for eighth week www.zgm.mn

Parliament session was delayed for the eighth week yesterday. While lawmakers are failing to form a quorum, the number of issues that require immediate approval have been piled up, which could potentially have dire consequence if the situation prolongs any further.

Apple won't be the last casualty of China's slowdown www.cnn.com

Hong Kong (CNN Business)From iPhones to autos, global brands rely on China for growth. Now the country's economic slowdown is putting their earnings at risk.

Apple (AAPL) on Wednesday said that it expected a weaker Chinese economy to hurt its holiday sales numbers, prompting its stock to plunge up to 8% in after hours trading. CEO Tim Cook said in a letter to investors that the company had been blindsided by "the magnitude of the economic deceleration" there.
It isn't the only company that could suffer. The slump in China's economy, the second largest in the world, could hit companies like General Motors (GM), Volkswagen (VLKAF) and Starbucks (SBUX), which will report earnings in the coming weeks.
"This year has the potential to be a tough year for western brands," said Benjamin Cavender, a Shanghai-based analyst at consultant China Market Research Group.

The Chinese economy is flagging after decades of expansion. Growth in 2018 is expected to be the weakest since 1990. The outlook for this year is even worse, as the trade war with the United States and government attempts to curb runaway debt take their toll.
That spells trouble for companies that rely on China's enormous market to boost their global sales. Chinese consumers could be less willing to part with their cash for the latest smartphone or luxury handbag as they tighten their belts.
"Brands like Apple will struggle in part because consumers are having to think harder to justify premium products and brands," said Cavender. He points out that China now boasts a number of homegrown smartphone makers, like Huawei and Xiaomi. Many of these offer products that are competitive with the iPhone's capabilities but are substantially cheaper.
China is hugely important to Apple, making up about 15% of the company's global revenues. "When you talk about China and Apple, they're tied at the hip," said Dan Ives, New York-based managing director of equity research at broker Wedbush Securities. China is "the heart and lungs of the Apple growth story."
But he thinks the company has made missteps in this market, such as selling some recent models of the iPhone at a price deemed too expensive by Chinese consumers.
Starbucks feeling the squeeze
It isn't just high-tech names that are likely to feel the squeeze. The cost of a Starbucks latte is substantially less than a new iPhone, but America's biggest coffee chain is unlikely to escape China's economic slowdown. The firm has an ambitious expansion plan for China, Starbucks' second-biggest market after the United States, but sales have been slowing.
The coffee company is considered a luxury brand in the country, said Nick Setyan, another analyst at Wedbush who covers the restaurant business. That makes Starbucks vulnerable if consumers decide to cut back on spending because of the economic downturn.
The problem is magnified because the Seattle-based company is also facing rising competition from local players, like Luckin Coffee, which has been rapidly increasing its number of stores and sells much cheaper coffee.
"We are going to see Starbucks continuing to struggle," added China Market Research's Cavender.
A customer trying a red iPhone 7 in Nanjing, China. Apple on Wednesday said that it expected a weaker Chinese economy to hurt its holiday sales, prompting its stock to plunge.
A customer trying a red iPhone 7 in Nanjing, China. Apple on Wednesday said that it expected a weaker Chinese economy to hurt its holiday sales, prompting its stock to plunge.
Auto market likely to get worse
China has been a source of blockbuster sales for major carmakers for years, as rapid economic growth gave millions of consumers the cash to spend on middle-class status symbols.
For the likes of General Motors and Volkswagen, China brings in more revenue than the United States or Europe. "The China market is extremely important to all carmakers," said Tu Le, Beijing-based founder of research firm Sino Auto Insights.

But GM, Volkswagen, Jaguar Land Rover and Ford (F) are among those companies that reported late last year that their sales in the country were sliding as the economy lost momentum. Some brands blamed the trade war with the United States, which is making drivers think twice before splashing out on a new ride.
Le thinks that Ford, Volkswagen and Tesla (TSLA) are among the Western automakers that are most vulnerable to China's slowdown. Ford has struggled to attract drivers there with its line-up of cars in the country, while Tesla faces huge competition from cheaper, Chinese-made electric vehicles.
Experts think things could get worse before they get better, despite recent moves by Beijing to cut tariffs on US auto imports at the end of last year.
"Regaining the momentum towards growth is going to be very challenging in the next year or two if the overall economy stays weak," said Le.
Apple suppliers
Shares in companies that provide components for Apple products were among the hardest hit by the fallout from the iPhone maker's warning.
Hon Hai Precision (HNHPD), better known as Foxconn, fell 2% on Thursday in Taipei. Catcher Technology, a Taiwanese company that makes iPhone cases, dropped nearly 4%.
Austria's AMS (AMSSY), which makes light sensors, plunged more than 19%. Shares in European chipmakers Dialog Semiconductors (DLGNF) and STMicroelectronics (STM) dropped 7%.
Danielle Wiener-Bronner contributed to this report.

Mongolia, Cheese, and the Future of Dairy in the Era of Climate Change www.civileats.com

From coast to coast, American farmers are battling record-setting heat waves, fires, droughts, and excess rain. Partially deployed to calm grazing animals stressed by adverse weather, but also help stop, and even reverse, climate change, some dairy farmers are returning to 100 percent pasture-based diets for their animals by introducing innovative grazing techniques that they believe will help create happy cows and sequester carbon in the process.

Surprisingly, some researchers say the recent fate of nomadic dairy-herders in Mongolia may provide a chilling glimpse into the future of cheese in North America and Europe, if our production and consumption patterns don’t change.

The people of Mongolia have depended on dairy since about 3,000 BCE, when an early shift in the climate transformed the land from forest into grassland and desert, says Paul Kindstedt, author of Cheese and Culture: A History of Cheese and Its Place in Western Civilization, and a professor at the University of Vermont. Mongolia is one of the few pockets of the world that has carried out the same farming and herding practices on a large scale for thousands of years, he says.

Today, about 30 percent of the 3 million people living in Mongolia are nomads. They graze yak, cows, sheep, goats, horses, and camels in the world’s most sparsely populated nation, and they survive on the meat and dairy their herds produce. But their lives and livelihoods are at risk from climate change, compounded by political upheaval from the communist era.

While many of the details differ, the U.S. dairy industry is undergoing an its own upheaval. Since 1991, small farms have been crowded out by large-scale producers, and a combination of politics, economics, and climate change is putting the future of small-scale U.S. dairy at risk.

What Mongolia Teaches Us About Climate Change
“Climate change has reshaped the Eurasian steppes repeatedly, and the people who lived there learned to adapt in a symbiotic fashion that benefited the landscape and the people,” Kindstedt says. “It’s a delicate dance, because if people use too many resources too quickly in an environment like that, it means certain death. Living nomadically with a limited number of animals on the grasslands was their only choice.”

While communism drove Mongolian people to the cities, its fall sent them back to their herding lifestyles. In the meantime, grazing had become much more intensified. Now, more than 65 million livestock graze the steppes of Mongolia, compared to about 23 million in the communist era. “Overgrazing has caused the degradation of pastureland, especially by goats, which have exploded in number because of the price goat cashmere brings abroad,” Kindstedt says.

With a stacked deck, re-minted nomads are playing against record-breaking extreme weather. This winter, temperatures dropped to -50º C, and hundreds of thousands of grazing animals died. (Known as Dzud, the lethal Mongolian winters have wiped out more than 20 million animals since the early 2000s). Despite extreme cold spells, average temperatures in Mongolia have climbed 2.2ºC since 1880, leading the nation’s environmental ministry to report that hundreds of rivers, lakes, and springs have dried up in recent years.

As a result, nomads have flooded back into Mongolia’s jam-packed capital of Ulaanbaatar, while Nomads who continue to herd and live on the steppes are facing drought, hunger, and even starvation.

Incredibly, most of the cheese available in Ulaanbaatar is still imported. “Requirements for sanitation, safety, and traceability creates steep barriers for many of these producers,” Kindstedt explains. “Think of how hard it is for an artisanal cheesemaker in Vermont to get distribution in metropolitan areas, and multiply that by a thousand.”

Until there’s a viable avenue for herders to get sustainably produced traditional Mongolian milk products to market, there’s no motivation to stay and battle the harsh elements of the steppes.

“The government is taking the crisis seriously, and working to establish a market for cheese, which they believe will help stabilize the grazing practices,” Kindstedt says. A planned cheese-making facility in the northern Mongolian village of Khatgal seeks to meet international standards for food safety and hygiene in order to send traditional Mongolian milk products into the global market. By making exports possible, Mongolian dairy farming could become a viable livelihood again, reversing the trend of urban migration.

Environmental groups have long warned consumers about the sizable carbon footprint of this popular food. And because it requires so much milk to make, and cows release methane into the atmosphere, cheese ranks just below meat from ruminant animals such as beef and lamb.

But there’s a growing consensus among farmers and scientists that cheese (and meat) production, managed responsibly, can be a part of the solution to the climate crisis.

Climate change is decimating soil fertility around the world, and especially in the American West, UNESCO warns. But sustainable farming methods, including responsible grazing practices, can dramatically increase soil fertility, declares a recent study published in Agricultural Systems.

This year is on pace to be the fourth-hottest on record, after 2015, 2016, and 2017. This summer has been nicknamed “the summer of fire” as flames raged across the country. This extreme weather is having a huge impact on dairy farmers, says Guy Jodarski, the supervising veterinarian for Organic Valley Co-Op.

“[Last summer] we had an extreme drought in the Pacific Northwest, and extreme heat in the Northeast. Cows are happy at 50 and 60 degrees. Ninety and 100, not so much,” Jodarski says. “I’m on the phone with farmers regularly discussing how to keep the animals healthy, unstressed, and cool.”

In his work with dairy farmers in 35 states, Jodarski has a bird’s-eye view of America’s rural landscape. And what he sees—in addition to the weather challenges—isn’t pretty.

“The upheaval I’m seeing in rural America sounds somewhat similar to what’s happening in Mongolia, to be honest,” says Jodarski. “In my lifetime, I’ve seen more than 90 percent of the dairies in Wisconsin shut down; people are just streaming out of towns to cities; high schools can’t field football teams; there are empty storefronts on our main streets.”

Maple Hill Creamery, an organic grass-fed dairy company founded in 2009 currently works with 199 farms grazing 8,860 cows on 22,700 acres of land. Grass-fed dairy and beef bring home more bacon to the small farmers Maple Hill works with, and co-founder Tim Joseph says it goes deeper than that.

“Grass-fed organic dairy is inherently regenerative,” says Joseph, “because cows grazed on perennial pasture put the organic matter they produce—carbon—back in the soil.” Managed grazing can also help retain more water in the soil, making the land more resilient in the changing climate.

Here’s where herding, grazing, and cheesemaking close the climate loop, says Kindstedt.

“Cheese was essentially created thousands of years ago in part as a response to … over-intensive agricultural practices,” says Kindstedt. “Neolithic humans began herding goats and sheep more intensely as they could survive on land unfit for crops. At the same time, we invented pottery, which we used to store milk and eventually, yogurt and cheese.”

The culture of cheese-making was created by a man-made climate disaster, and now may be contributing to a second, potentially more catastrophic event. Unless we reverse course, Kindsted says.

“Masses of humanity in Western and sub-Saharan Africa have already been made desperate by climate change,” Kindstedt says. “Italy has shut its doors to the flow of migrants desperately fleeing their homes, and now they’re knocking on Spain’s door. And that’s just the tip of the iceberg if climate change continues.”

Cheese has a notoriously large carbon footprint, but it can be significantly offset by grass-fed, organic farming practices, Organic Valley’s Jodarksi explains.

“Grazing not only prevents soil erosion, but by walking around and tamping down dirt, the cows essentially sequester the carbon they emit through their burps back into the soil,” Jodarski says. “Their manure also gets spread across fields. You can get a net positive, especially when what they’re foraging on is high- quality grass.”

Milk and cheese from grass-fed cattle fetch higher prices that can keep family farmers afloat who have been squeezed out by the rise of Big Milk. And while a recent study found that sales of grass-fed dairy climbed 38 percent, stronger sales will accelerate the benefits.

In both countries, pasture-based practices might ensure a brighter future for cheese.

Mongolia starts new phase of air pollution control project www.xinhuanet.com

ULAN BATOR, Jan. 3 (Xinhua) -- Mongolia's capital Ulan Bator started on Thursday a new phase of an air pollution control project supported by the Japanese International Cooperation Agency (JICA), according to the mayor's press office.

Inner Mongolia police return fugitives from abroad www.xinhuanet.com

HOHHOT -- Three suspects were returned to China as part of the Fox Hunt campaign against economic fugitives, police in northern China's Inner Mongolia Autonomous Region said on Thursday.

Wooden materials to be exempt from import duties www.montsame.mn

Ulaanbaatar /MONTSAME/ The Law on Customs Duty Exemption approved on May 10, 2018 took effect from January 1, 2019.

Third Mongolian in finals of BBC Cardiff Singer of the World www.news.mn

Mongolian baritone Ch.Badral has got through to the final stage of the BBC Cardiff Singer of the World 2019 – but, we will have to wait as the grand conclusion of the competition is scheduled for 17-22 June. The event will be held in Cardiff, which is the capital city of Wales. Ch.Badral is among 19 opera singers who have been selected for the final stage from over 400 participants.

World may face ‘low price scenario’ for oil this year if OPEC plan fails, JP Morgan warns www.rt.com

Global benchmark Brent will remain at around last year’s lowest point in 2019 if OPEC members do not stick to the agreed output cuts, JP Morgan’s head of Asia Pacific oil and gas believes.
The Organization of the Petroleum Exporting Countries (OPEC) and allied oil producers sealed a deal on production cuts in early December in an attempt to boost the market. The cartel and its partners agreed to curb crude output by 1.2 million barrels per day (bpd), briefly sending oil prices up, before they slumped to the lowest point in more than a year.

Asia's economy deemed to be swayed by China slowdown in 2019 www.asia.nikkei.com

SINGAPORE -- China will again shape Asia's economic outlook in 2019 as the region's largest economy faces internal and external challenges, including trade tensions with the U.S.

Economists expect China's growth to slow versus 2018, affecting economies across Asia. All eyes are fixed on Beijing's response.

In line with global trends, the regional economy is likely to see slower growth in 2019, estimates by economists and governments suggest. According to Japanese investment bank Nomura, one of the key challenges faced by Asia is China's expected slowdown, especially in the first half of the year.

In 2018, China's growth slowed gradually, with gross domestic product expanding by 6.8% on the year in the first quarter, by 6.7% in the second quarter and by 6.5% in the third quarter, as the government cut back on infrastructure spending to try to reduce debt at the local level. Weaker car sales added to the slowdown.

Ting Lu, Nomura's chief China economist, expects much slower growth in the coming months. Pointing to the weak auto sales, which were a drag on consumption figures, he said, "We believe this kind of decline will extend all the way into the first half of [2019]." Lu also predicted sales of construction equipment will also drop in the first half of the year due to the replacement cycle and the end of stimulus measures aimed at encouraging purchases.

In addition to domestic factors, the U.S.-China trade fight will likely weigh on the Chinese economy. Data show that U.S. tariff increases on Chinese exports have started to bite, with the Chinese government's Manufacturing Purchasing Managers' Index showing declines in export orders over the past few months through November 2018.

HSBC, a bank, said in a recent report that an escalation of the trade war could shave 0.7 to 0.8 percentage point off China's GDP growth in 2019. According to the latest China economist survey compiled by Nikkei, the country's economic growth is forecast to slow to 6.2% in 2019 from 6.6% in 2018.

Given that likelihood, market watchers are turning their attention to the steps the government will take to keep the economy ticking over. The leadership under President Xi Jinping already hinted at more fiscal stimulus, such as bigger tax cuts, at the annual Central Economic Work Conference in mid-December.

"The external environment is complicated and severe, and the economy faces downward pressure," the conference statement said. It called for "bolder and more effective measures" to implement a "proactive fiscal policy." The plan is to expand tax cuts and fee reductions beyond the roughly 1.3 trillion yuan ($188 billion) authorized for 2018.

A slowdown in China would have ripple effects across Asia, as it is a major trading partner for most countries in the region. That would also affect the region's market confidence. Most economies in Southeast Asia started to cool in the second half of 2018 as U.S.-China trade tensions escalated.

At the same time, growth in the technology sector is slowing worldwide, which will dent the growth of electronics exporters. The World Semiconductor Trade Statistics in November predicted the chip market as a whole will grow by just 2.6% in 2019, compared with 15.7% in 2018, due to weaker demand for smartphones.

Output of electronics in places like Japan, South Korea and Taiwan may suffer. Sales at Taiwan's Largan Precision, one of the world's largest manufacturers of lenses for smartphone cameras, dropped nearly 30% on the year in November.

Another potentially destabilizing factor in Asia in 2019 is elections, and the political uncertainty that may result.

The first big electoral test in the region is scheduled for Feb. 24, when Thai voters head to the polls for parliamentary elections that will mark a milestone in the country's return to civilian rule.

"Even if a general election passes smoothly, political uncertainty is likely to remain a drag on Thailand's prospects," according to a report by Capital Economics. Pointing to the short-term risk from civil unrest, the report says, "Another outbreak of protests and violent conflict, similar to those observed in 2010 and 2014, would deal a significant blow to the economy."

Indonesia will hold a presidential election in April, and there will be midterm elections in the Philippines the following month. India will also have a general election in May. Clouds on the political horizon are already affecting the region's third-largest economy, with central bank chief Urjit Patel resigning in December over policy differences with the government of Prime Minister Narendra Modi.

Some emerging economies may need to continue raising interest rates to keep local economies stable as the U.S. Federal Reserve hinted at more interest rate increases at its December policy meeting. On Dec. 20, stock indexes in emerging markets dropped when the Fed implied two rate hikes might be coming in 2019, on the heels of four the previous year.

Fed tightening tends to pull in capital to the U.S. from emerging markets, and that could cool domestic consumption and investment.

One positive factor would be lower oil prices, which peaked in late 2018. As many Asian economies rely heavily on domestic consumption, lower oil prices could help moderate inflation and boost consumer spending.