Japanese Stocks Rise for Third Day as Greece Vote Eases Default Concerns

Japanese stocks rose for a third day after Greece passed austerity measures needed to secure aid from the European Union, easing concern the country will suffer a default that destabilizes the banking system.
Canon Inc., which counts Europe as its largest market, advanced 0.5 percent. Mitsubishi UFJ Financial Group Inc., Japan’s biggest bank by market value, climbed 2.1 percent after Deutsche Bank AG. recommended the stock. Inpex Corp., Japan’s largest energy exploration company, gained 0.3 percent after crude prices increased.
The Nikkei 225 Stock Average rose 0.3 percent to 9,827.60 as of 9:07 a.m. in Tokyo. The broader Topix index gained 0.4 percent to 847.71.
“There will still be a lot of twists and turns, but Greece has been able to avoid a worst-case scenario,” said Mitsushige Akino, who oversees about $600 million in Tokyo at Ichiyoshi Investment Management Co. “That makes it easier for investors to take on risk.”
The Topix index lost 9.3 percent through yesterday since March 10, the day before a magnitude-9 earthquake and tsunami devastated Japan’s northeast coast, triggering the worst nuclear accident in 25 years and leaving more than 23,000 people dead or missing.www.bloomberg.com

GE Pursues $3 Billion of Brazil Deals as Petrobras Demand Rises

General Electric Co. (GE), which spent more than $4.1 billion on acquisitions since October to build its oil and gas unit, is bidding for about $3 billion of Brazil energy contracts over three years as the industry expands.

GE is competing for work that includes supplying Petroleo Brasileiro SA (PETR4) with equipment for its floating production vessels, Fernando Martins, a vice president for GE’s oil and gas division in Latin America, said yesterday in a telephone interview from Rio de Janeiro. The company is also talking with Petrobras on supplying subsea wellhead systems, he said.

“We have equipment and services from the subsea well up to the refinery,” he said. “This is a terrific opportunity.”

GE, based in Fairfield, Connecticut, earlier this week won three contracts worth $350 million in Brazil, including deals to provide subsea logistics services to Petrobras and drilling systems for Royal Dutch Shell Plc. Brazil, home to the biggest oil discovery in the Americas in the past three decades, is seeking to more than double its oil output by 2020.

GE plans to hire 500 workers for its Brazilian oil and gas business before year-end, an increase of about 42 percent, Martins said. The company is also setting up plans to retain its employees as the “very fast” expansion increases competition for human resources in the country, he said.

Employee Retention

“Sometimes more importantly than hiring new people is making sure that you retain your own employees,” Martins said, adding that the unit had a turnover rate of less than 3 percent of its workforce in the past year.

GE Oil & Gas has more than 20,000 employees in 100 countries. In 2010, the division provided $7.6 billion of the parent company’s $150.2 billion in total sales.

GE’s acquisitions since October have included John Wood Group Plc’s well-support division, parts of Dresser Inc. and Wellstream Holdings Plc, an oil services provider focused on Brazil.

GE rose 6 cents, or 0.3 percent, to $18.30 at 2:22 p.m. in New York Stock Exchange composite trading. The stock has gained about 16 percent in the past year. www.bloomberg.com

France Backs Compensation for Food Producers as E. Coli Crisis Hits Demand

France, the European Union’s largest agricultural grower, is backing a plan to compensate farmers in the 27-nation bloc after the deadliest outbreak of E. coli ever recorded decimated demand.

As much as 80 percent of vegetable supplies are being destroyed in some areas because there is no market for them, Copa-Cogeca, a farm lobby group based in Brussels, said in a report today. “Unprecedented” losses are running into millions of euros a day, and “paralyzed” trade is extending into the fruit market, it said.

EU agriculture ministers are meeting in Luxembourg today to discuss their response to the outbreak, which has killed 23 people and sickened 2,429. They are also contending with an international trade crisis afterRussia banned imports June 2 and Prime Minister Vladimir Putin said he won’t “poison people” to meet international trade rules.

“It is fair to try to define the way of compensating the loss of the producers,” French Agriculture Minister Bruno Le Maire said in an interview in London today, adding that its scale had yet to be decided. “There has been a great failure, and we have to take that into account and try to improve our safety system so that it will never happen again.”

The Netherlands, the world’s second-largest agricultural exporter after the U.S., said yesterday it is asking for “broad support measures” for vegetable growers, including buying up of produce that can no longer be sold to consumers. The origin of the outbreak is still unknown.

Emergency Fund

A proposal by the Netherlands for an emergency fund is backed by Germany and Spain, farm organization LTO Nederland said in a statement yesterday. State Secretary for Agriculture Henk Bleker will also ask for measures to promote vegetables, the Dutch government said. The proposal has support from nine other member states, LTO said in a statement today.

The proposed fund is gaining support, Bleker said today before the meeting. “I’m not so good in counting, but it’s going well,” he said.

The EU should spend as much as 55 million euros ($80 million) on a three-week media campaign to promote fresh produce, Freshfel Europe, which represents the industry, said today. Sales of cucumbers fell 80 percent to 100 percent in some member states, tomatoes 50 percent to 80 percent and lettuce more than 50 percent, it said in a statement.

Cucumbers slumped to 5 cents a unit from a five-year average of 21 cents, while tomatoes now cost 13 cents a kilogram (2.2 pounds), compared with an average of 60 cents, Copa-Cogeca said. Prices are “well below” production costs, it said.

Spanish fruit and vegetable producers are losing 225 million euros a week because of the outbreak, said Jose Maria Pozancos, director general of trade group FEPEX. The Dutch vegetable industry is losing 80 million euros a week as orders are canceled, LTO said yesterday. www.bloomberg.com