China ditching US coal imports for domestic supply in trade tariff tit-for-tat www.rt.com

Washington trade tariffs against Beijing appear to be backfiring on the US coal industry, as Chinese importers are finding new domestic alternatives to soften the blow.
“We have completely stopped US metallurgical coal (imports), which is popular among steel mills, in late July. There is too much uncertainty in trade,” a senior manager at a major Chinese coal trading house told Reuters on condition of anonymity.

Russia in gold buying spree ahead of tougher US sanctions www.rt.com

Russia’s Central Bank has picked up pace when it comes to gold buying, adding 26 tonnes to its reserves in July, more than in any other month this year, ahead of the news sanctions imposed by the US.

Ulaanbaatar to increase number of buses www.news.mn

The Ulaanbaatar City Transport Department has decided to increase the number of buses to meet the rise in passenger demand and in anticipation of the beginning of the new academic year.

8 percent pay raise fails to stop teachers' strike www.zgm.mn

Cabinet decided to raise public servants’ salary by 8-30 percent durings its regular session yesterday; however, teachers and health workers remain unsatisfied with the amount and pledge to strike in September. Since last year, teachers and medical workers staged several protest for their pay and received the Government’s pledge for 50 percent raise, warning to go onto the next stage of strike in September if their demand remains unfulfilled until then. Minister of Labour and Social Protection Chinzorig Sodnom told the press, “The decision excludes ballot positions and prosecutors, and will take effect starting from September 1. First of all, salaries of teachers and medical workers, as well as their equivalent positions and those who get paid lower than them, will be increased by eight percent. We have completed a study, in cooperation with the Ministry of Health, Education, Culture, Science and Sports, to improve the pay levels of civil servants. The study shows that elementary school and kindergarten teachers require the most skills and have the highest pressure.

Container ship to break the ice on Russian Arctic route www.bbc.com

A Danish vessel setting sail from Vladivostok this week is set to become the first container ship to tackle the Arctic sea route north of Russia.

Orkhon aimag to export 4000 tons of meat to Russia, China and Iran www.montsame.mn

Orkhon/MONTSAME/ Four companies of Orkhon aimag will export 4000 tons of meat to the Russian Federation, the People’s Republic of China and the Islamic Republic of Iran in 2018-2019.

Flock on - Mongolia meat exporters turn to Iran's halal markets www.reuters.com

DARKHAN, Mongolia (Reuters) - Mongolian butcher Kuntuguan Ajbai chants under his breath as he slits the throat of a sheep with a single stroke of his sharpened knife, making sure the animal’s swift death is halal – acceptable under the laws of Islam.

Kuntuguan’s work at a slaughterhouse in the city of Darkhan, about 100 miles (160 km) from the nation’s capital, comes amid surging demand from Iran for halal meat and as Mongolia pushes to make more money from the huge herds of livestock that roam its vast grasslands.

“This is a special ritual we do while slaughtering,” said Kuntuguan, a 27-year-old Muslim of Kazakh extraction, his rubber boots and white apron splattered with blood.

“We do it in the name of Allah to get permission to kill the animals.”

Mongolia has an estimated 30 million sheep - more than New Zealand - but has until recently only managed to export a thin slice of its overall meat output. It hopes that will change as it taps overseas appetite for halal mutton from places such as Iran, which are forced to import due to limited local production.

Largely because of that kind of new demand, Mongolia’s sheep and goat meat shipments hit 2,601 tonnes in 2017, 11 times more than 2016.

And while that was worth only around $8 million, industry officials say those volumes are likely just the start, with exports in the first-half of 2018 quadrupling year-on-year to 775.6 tonnes.

"The halal meat market is growing worldwide, promising new opportunities for Mongolia," said Ochirbat Begz, executive director of the Mongolia Meat Association. For graphic on Mongolia livestock herds, click tmsnrt.rs/2Leefg6

Under pressure from the International Monetary Fund to diversify away from mining, Mongolia has been trying to turn its huge pastoral economy into a major earner, hoping its free-range organic meat will find a home on plates overseas.

The plant where Kuntuguan works is run by Darkhan Meat Foods, which along with rival meat producers Max Impex MMX.MNE and Max Market is rushing to supply mutton to Iran.

It employs around 200 workers at the site, all involved in halal mutton output, and expects to double its exports of the meat in 2018 from 1,320 tonnes last year.

“Before contracting with an Iranian company, we only exported beef and horse meat to other countries,” said Otgon-Erdene Bavuudorj, the firm’s general manager.

During a visit to the plant by Reuters, around a thousand 18-month old sheep were slaughtered and then deboned, chopped and packed under the supervision of experts from Dana Negah Parsian, an Iranian importing company, as well as the Iranian Veterinary Organisation.

The mutton is then frozen and transported by truck through Russia and Kazakhstan, reaching Iran in about two weeks.

Seyed Erfan Esfahani, business manager with the Iranian importer, said the country still needed to improve technology at its slaughtering plants and to train more staff.

In order for meat to be deemed halal, the butcher who slaughters animals must be Muslim. Mongolia is predominantly Buddhist, but 100,000 mostly-Muslim Kazakhs account for around 3 percent of its population.

The nation has also struggled with foot-and-mouth disease, with an outbreak this March forcing the government to declare martial law in 12 provinces and distribute 500,000 vaccines.

Mongolia has drawn up new animal health legislation to fight such diseases, with the Iranian importers saying they were doing all they could to guarantee meat they buy is safe.

“I check sheep before slaughtering, and have not seen any major problems with animal diseases, said Hamid Reza Kavosh, head of the veterinary office in Iran’s Khuzestan province, while at the Darkhan plant.

Another problem is the seasonal nature of meat production in Mongolia.

“Putting livestock to pasture is good in the sense that they are free to choose the best grazing area and drink clean water from nature,” said Ochirbat at the country’s meat industry body.

“But importing countries demand regular supplies, which is impossible to meet with pasture, so export-oriented farms need to be developed,” he added.

The reintroduction of trade sanctions on Iran by the United States could also cloud the horizon. Washington has warned there will be consequences for countries that do not respect the sanctions.

But Ochirbat played down such worries, saying it was still early days for halal exports to Iran.

“It’s a little business-to-business trade (at this stage) and not a big international cooperation or something, so it should be okay,” he said.

Reporting by Munkhchimeg Davaasharav; Editing by David Stanway and Joseph Radford

Mongolia to hold international coal conference to attract investment www.xinhuanet.com

ULAN BATOR (Xinhua) – Mongolia will hold the 8th Coal Mongolia International Conference and Exhibition in Ulan Bator to attract investment in the country’s coal industry, organisers said yesterday.

Mongolia eager to enhance ties with EU to diversify economy www.xinhuanet.com

ULAN BATOR, Aug. 21 (Xinhua) -- Mongolia is keen on enhancing relations and cooperation with the European Union (EU) to diversify its mining-dependent economy, Mongolia's Parliament Speaker Miyegombo Enkhbold said Tuesday.

China, Mongolia see great potential for cashmere trade www.globaltimes.cn

Mongolia has long pushed to diversify its economy and increase the economic viability of its livestock sector, particularly its wool and cashmere business. This is also important for China. Although China sits atop the global cashmere production rankings, well ahead of second-placed Mongolia in output terms, Chinese traders are still the biggest purchasers of Mongolian cashmere. During the 18th Shanghai Cooperation Organization Summit in the coastal city of Qingdao, East China's Shandong Province in June, Mongolian President Khaltmaagiin Battulga proposed cooperating with China in areas including the cashmere industry as the two countries account for 95 percent of the world's market for raw cashmere, according to the Office of the President of Mongolia.

In a recent interview with the Global Times (GT), Li Chao (Li), a junior research fellow with the Russia and Mongolia Research Institute at the Inner Mongolia Academy of Social Sciences, shared his thoughts on the prospects for China-Mongolia cooperation in the cashmere trade.

GT: How important is Mongolia's cashmere push for the nation's diversification strategy?

Li: The push for a diversified economy has been a key issue for Mongolia and in recent years the country has put a greater emphasis on increasing livestock output. The Mongolian government's Action Program for 2016-20 calls for stepped-up implementation of the "Mongolian Livestock" national program. It is expected that the economic viability of the nation's livestock sector will be improved as a system is to be put in place regarding the collection, storage and transportation of wool, cashmere and leather, among other efforts.

That said, the cashmere business, in particular, means a lot to the nation's diversification drive. Due to Mongolia's harsh winter, the nation's goats grow longer hair which can be sheared into wool that is warmer than that of other breeds. This, in addition to Mongolia's natural-style livestock farming and cashmere production, renders Mongolian cashmere competitive in the global market. Cashmere is not just the Mongolian livestock industry's top export business, but the nation's second-largest export category after minerals.

In an effort to boost its cashmere industry, the government in February launched a four-year program aiming specifically to improve the manufacturing and technological innovation of cashmere products and to provide financial support for cashmere companies.

The Mongolian government not only hopes to increase exports of semi-finished cashmere products, but also wants to foster higher value-added exports and increase the profitability of the country's cashmere businesses. The cashmere industry could help to cut the economy's heavy reliance on mining exports.

GT: What are the challenges facing Mongolia's cashmere sector?

Li: The cashmere industry is increasing its role in Mongolia's economy but it still faces challenges. About two-thirds of Mongolian cashmere companies currently focus on the manufacturing of cashmere products for preliminary processing and there is only a small number of companies involved in making cashmere yarn and knitted products. The issue with preliminary processing is unlikely to be resolved overnight.

Additionally, drying surface waters have over the years aggravated desertification in Mongolia. Climate change and overgrazing are also believed to have resulted in the degradation of much of the country's pastures. This fragile ecological environment could hinder the growth of Mongolia's cashmere industry.

On top of that, there is a concern about fundraising for small and medium-sized businesses. Smaller cashmere processing companies in the country still don't have sufficient capital to purchase raw cashmere or upgrade their technologies. Although the national cashmere program will offer some financial support, the annualized loan rates it provides remain unaffordable for some companies. This suggests further fiscal and financial support will be essential for the country's cashmere businesses.

GT: What is the potential for the trade in cashmere between China and Mongolia?

Li: Last year, cashmere was Mongolia's fifth-largest export to China, behind coal, copper powder, crude oil and iron ore, according to official data. China's imports of Mongolian cashmere have risen steadily in recent years. Normally, Mongolian cashmere exported to China is processed further and turned into finished products for re-export. It could be said that the two countries' cooperation on cashmere mainly revolves around the trade of semi-finished cashmere products.

Owing to insufficient processing capacity, even if Mongolia upgrades its cashmere supply chain, its domestic factories remain weak in terms of further processing of raw materials. This means that exporting semi-finished cashmere products is still in the interests of the Mongolian economy. As the world's largest cashmere producer and consumer, China is also in need of raw cashmere from Mongolia. This matters not just in terms of quantity; it also suits China's need for different varieties of cashmere. In another sign of complementarity, Mongolian cashmere makers also import wool cashmere blends from China. The two countries' cooperation in this regard will be expected to effectively push for bilateral trade growth.

GT: What still needs to be done to build a closer partnership between the two countries in the cashmere trade?

Li: It is of vital importance for Mongolia to create a sound investment climate to attract Chinese cashmere businesses. That would require sufficient legal protection and stable investment policies for Chinese investors. Mongolia should also keep a close watch on China's cashmere consumption market and cashmere processing technologies. China, for its part, can encourage Mongolian cashmere makers to enter into the country's bonded warehouses, and can help in setting up sales channels for Mongolian cashmere finished products to be distributed across China. China might also transfer some of its preliminary processing capacities or technologies to Mongolia.

The two countries could also cooperate on the monitoring of quality management of raw cashmere and jointly explore the international market for finished products. More importantly, the two countries need to consider plans for strategic cooperation in the field of cashmere, which could involve the creation of an effective long-term mechanism highlighting bilateral exchanges in technologies, talent training and environmental protection so as to drive diversified development of Sino-Mongolian trade.