AFP

“A rush like this in the summertime, it’s unheard of — everybody wants coal,” says Frithjof Engelke, a supplier of the briquettes which have become a hot commodity in the German capital.

A looming shortage of Russian gas in the wake of the Ukraine war has reignited enthusiasm for this method of heating private homes despite its sooty residue and heavy carbon footprint.

Engelke, 46, head of the century-old Berlin business Hans Engelke Energie, says it’s brought a bonanza for his family business: “My holidays will have to wait.”

He and his team are frenziedly taking orders, organising deliveries by truck — now booked out until October, and getting supplies ready for those who come directly to pick up coal from his warehouse.  

On a hot summer’s day, he weighs and bags loose coal amid the dust and din of his filling machine, then arranges the bags on pallets, awaiting customers. 

In Berlin, 5-6,000 homes still heat with coal — only a fraction of the city’s 1.9 million homes, say municipal authorities.

Engelke’s customers are often elderly people, sometimes entirely dependent on coal and living in old dwellings that have never been renovated.

Others are lovers of the “cosy” heat emanating from often ornate old ceramic stoves. 

But this year, new customers have arrived “en masse”, says Engelke, whose medium-sized company has also diversified into wood pellets and fuel oil.

“Those who heat with gas but who still have a stove at home now all want to have coal,” he said, citing a phenomenon seen throughout Germany as winter approaches.

– ‘Better than being cold’ –

Jean Blum is one of the new converts. 

The 55-year-old man with tousled hair and a bushy white beard loads 25-kilogram (55-pound) bags filled with precious black briquettes in his trailer. 

“I’m buying coal for the first time in years,” he tells AFP.

Since his home is equipped with gas heating, he sometimes lights his stove, but only with wood.

With the jump in gas prices, which will be exacerbated this autumn when operators will be able to pass on the increase in energy levies to the consumer, Blum wants to make sure he has a safety net. 

“Even if it’s bad for your health, it’s still better than being cold,” he says.

Although coal prices have soared 30 percent this season, it remains cheaper than wood, whose price has more than doubled. 

“I worry when I wonder if there will be enough gas for everyone,” he adds, noting that Russian President Vladimir Putin has already partially closed the gas tap on Germany after Western nations imposed new sanctions on Moscow.

– ‘Renaissance’ –

The black fuel is experiencing a comeback on several fronts in Europe’s top economy. 

The German government had already resolved to increase the use of coal-fuelled power plants to satisfy the enormous appetites of several industries. 

However Berlin insists it will keep its pledge to phase out the heavily polluting energy source by 2030 and rules out a “renaissance of fossil fuels, in particular coal,” as Chancellor Olaf Scholz recently vowed.

However with new private customers coming out of the woodwork, production has a hard time keeping up, and many small coal merchants in the capital are running out of supplies. 

“We produce at full capacity during the summer, with three shifts, seven days a week,” Thoralf Schirmer, spokesman for LEAG, a mining site in the Lusatia basin, told AFP. 

The company supplies DIY stores and fuel sellers with coal briquettes.

Production has jumped 40 percent since January, he said, but demand is strong everywhere and the situation is expected to remain tense at least until this winter.

Adding to the pressure is the fact that the other factory supplying the market in Germany, based in the Rhine valley, will cease production at the end of the year, reducing supply.

“I dread the winter a bit,” Engelke, the coal seller, admits. 

Currently, people are relatively relaxed when they learn that they will have to wait at least two months before getting deliveries, he says. 

“Things will be radically different when it starts to get cold outside.”

Markets drifted in Asia on Wednesday, with investors trying to navigate an uncertain economic landscape as central banks hike interest rates to fight runaway inflation, in turn fuelling fears of a possible recession.

But while officials at the Federal Reserve and its peers are expected to keep tightening monetary policy for the rest of the year, talk is building that they will be able to ease up in 2023 — and maybe even cut rates — if the pace of price rises comes down.

Minutes from the Fed’s July meeting will be pored over when they are released later in the day, with investors hoping for some insight into policymakers’ thinking and an idea of its plan for next month’s gathering.

“We expect the … minutes to have a hawkish tilt,” Carol Kong, at Commonwealth Bank of Australia, said. “We would not be surprised if the minutes show (officials) considered a 100 basis points increase in July.”

The bank lifted rates by 75 points in both June and July.

Forecast-beating earnings from retail titans Walmart and Home Depot provided optimism that US consumers remain resilient even as inflation remains elevated and borrowing costs are going up.

However, Asia struggled to match the positive lead from Wall Street, with concerns about China’s economy dampening appetite.

The country’s central bank announced a surprise interest rate cut Monday and a report Tuesday said Premier Li Keqiang called on six key provinces — accounting for about 40 percent of the economy — to bolster pro-growth policies.

However, analysts said markets are more concerned about the debilitating impact of lockdowns and other strict containment measures implemented as part of the government’s zero-Covid strategy.

“Visibility over the evolution of China’s zero-Covid policy is low and recent messaging has suggested virus containment remains a top policy priority of the country,” said Adam Montanaro, investment director of global emerging markets equities at abrdn.

“Not only do investors hate uncertainty, but the negative economic impact of this policy is increasingly visible.”

Hong Kong was flat and Shanghai slipped, while there were also losses in Seoul and Wellington.

Tokyo, Singapore, Taipei and Manila rose.

Equities have enjoyed several weeks of gains since hitting their June lows, and while the initial bounce was broadly seen as a bear market rally there is a hope that they may have already reached their nadir.

“It looks like a bottom, acts like a bottom, and trades like a bottom, then it probably is a bottom,” said OANDA’s Edward Moya in a note.

“Bear market rally calls are suddenly becoming quiet these days. The risks of the Fed sending the economy into a recession are easing as inflation is slowly coming down.

“The Fed’s soft landing seems achievable and that has allowed this rally to continue.”

– Key figures at around 0230 GMT –

Tokyo – Nikkei 225: UP 0.8 percent at 29,101.33 (break)

Hong Kong – Hang Seng Index: FLAT at 19,837.16

Shanghai – Composite: DOWN 0.4 percent at 3,263.71

West Texas Intermediate: UP 0.3 percent at $86.78 per barrel

Brent North Sea crude: UP 0.2 percent at $92.51 per barrel

Euro/dollar: UP at $1.0174 from $1.0166 Tuesday

Pound/dollar: UP at $1.2108 from $1.2092

Euro/pound: DOWN at 84.01 pence from 84.04 pence

Dollar/yen: DOWN at 134.06 yen from 134.21 yen

New York – Dow: UP 0.7 percent at 34,152.01 (close)

London – FTSE 100: UP 0.4 percent at 7,536.06 (close)

— Bloomberg News contributed to this story —

The Cuban government has announced it will allow foreign investment in domestic wholesale and retail trade for the first time in 60 years, in a move aimed at addressing critical shortages of goods.

The decision could also give a boost to local industry, all without relinquishing state control over foreign trade.

“Foreign investment in wholesale and retail trade, with state regulation, will allow the expansion and diversification of supply to the population and will contribute to the recovery of domestic industry,” Economy Minister Alejandro Gil tweeted Tuesday, expanding on an announcement made late the previous night.

Foreign investors would be allowed to fully own Cuban wholesalers for the first time since Fidel Castro’s 1959 revolution, while retailers could enter into public-private ventures, according to deputy trade minister Ana Gonzalez Fraga.

Until now, foreign investment has been allowed only in the domestic production of goods and in the services sector.

The move to open up a sector hitherto controlled by the communist government is indicative of the difficulty state companies face in accessing foreign currency and raw materials.

This has aggravated severe shortages in basic goods such as food, medicine and fuel, and triggered rising discontent with the government that has prompted repeated protests in recent months.

There has also been rapid growth of informal trade in essential products, triggering consumer inflation which closed some 70 percent higher at the end of last year.

– Raw materials needed –

According to Cuban economist Mauricio Miranda Parrondo, “the state monopoly on foreign trade and retail is responsible for the shortage of consumer goods in the domestic market.”

Gonzalez Fraga told state TV late Monday that the latest measure sought to ensure investment in “raw materials, inputs, equipment and other goods that can contribute to the development of domestic production.”

Under US sanctions since 1962, Cuba began timidly opening up to private capital in the 1990s before fuller authorization in 2010 followed by a boom after a warming of ties with Washington under then-president Barack Obama.

In August last year, Havana gave the green light for small and medium enterprises to start operating on the island.

Months earlier, it had authorized private enterprise for the first time — though that was limited to individual entrepreneurs, not businesses.

The reforms represent a major ideological shift in a country where the government and its affiliate companies have monopolized most of the economy for decades. 

The country is battling its worst economic crisis in 30 years, fueled by toughened sanctions under the administration of Donald Trump and the fallout from the coronavirus crisis, which has hit Cuba’s crucial tourism sector hard.