Diesel vs doughnuts

This is an audio transcript of the FT News Briefing podcast episode: Diesel vs doughnuts

Marc Filippino
Good morning from the Financial Times. Today is Tuesday, September 14th. And this is your FT News Briefing.

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Marc Filippino
Chinese police are monitoring citizens who read overseas financial news sites. And the CEO of the rightwing social media app Parler has plans to grow his user base. We’ll also talk about the youthful politician in Brazil who’s challenging the political giants in the race to be president. Plus, energy companies are gobbling up biofuels like soyabean oil because they have to be greener. It’s causing headaches for other industries though.

Justin Jacobs
They’ve seen their input prices triple, and they have members like Krispy Kreme and smaller bakers who are worried they just might not be able to find oil when they go out into the market.

Marc Filippino
I’m Marc Filippino, and here’s the news you need to start your day.

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Marc Filippino
China has an anti-fraud app that’s been installed on more than 200m phones. It’s meant to block suspicious phone calls and to report malware. But the FT has found that Chinese police are using the app to monitor people who have been on international financial news websites. One user in Shanghai told the FT he had been summoned by authorities after visiting a US news service. He says police asked him whether he had contacts abroad and if he regularly read overseas financial websites. And Chinese citizens often can’t opt out of the security app. Parents say they have to download it before enrolling their children in school. And in the city of Shenzhen, some tenants have to install it before signing leases. Chinese officials did not respond to a request by the FT for comment.

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Marc Filippino
Brazil’s first openly gay state governor could become the country’s next president. Thirty-six-year-old Eduardo Leite is from the centre-right Brazilian Social Democratic party. He’s challenging the two giants of Brazil’s politics in next year’s election. And Leite is described as the dream candidate of the liberal economic elite. To talk more about this, I’m joined now by our Latin America editor, Michael Stott. Hi, Michael.

Michael Stott
Hello, Marc.

Marc Filippino
So, Michael, tell us a little bit more about Eduardo Leite. Why is he seen as so appealing to Brazil’s liberal economic elite?

Michael Stott
Well, Marc, the main reason is because they’re desperate for an alternative to the two most likely main candidates for next year’s election. That’s former President Lula on the left and the current president, the far-right Bolsonaro. Neither of them is particularly appealing to a lot of the economic elite and to Brazilians in the centre. And so they’re casting around to see whether there’s somebody that might be able to challenge those two.

Marc Filippino
So, you know, aside from not being Lula or Bolsonaro, what does Leite bring to the table in terms of economic policies?

Michael Stott
Well, this is an interesting one because you might imagine that Brazil, having suffered very badly in the pandemic with the world’s second highest toll of dead — 585,000 so far — would be looking for somebody with a lot of sort of leftist social policies. But Leite thinks that, in fact, what Brazil wants is economic reform and is somebody who can deliver on the agenda that Bolsonaro didn’t deliver on, which was privatisation, slimming the state, making the state more efficient and attracting foreign investment. And that’s the programme he’s laying out. It’s one that clearly appeals to business, would appeal to foreign investors. The question is whether that can appeal more broadly to enough Brazilians for him to get into a second round against Lula.

Marc Filippino
OK, but realistically, what are his chances, especially as being a gay man in a predominantly Catholic country?

Michael Stott
Although the country has an openly homophobic president in Bolsonaro who has boasted of his antipathy towards gay people, in fact most Brazilians are fairly tolerant. The main problem Leite has is the polarisation of Brazilian politics. So like a lot of countries today, social media and the increasing sort of tensions of politics have pushed people to the extremes of the left and the right. And there’s not much space for someone to come through in the centre.

Marc Filippino
Michael Stott is the FT’s Latin America editor.

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Marc Filippino
In the US, some states are incentivising fuel refiners to produce cleaner fuels. So companies like ExxonMobil and Marathon have come up with a renewable diesel product, and they’re buying so much vegetable oil to make it that prices have skyrocketed. This is not good news for companies that make things like doughnuts. Here’s the FT’s Houston correspondent Justin Jacobs.

Justin Jacobs
We heard from the Krispy Kreme CEO recently talking about how the spike in prices for them has been, you know, really extraordinary and something that they haven’t seen before.

Marc Filippino
So, Justin, is it just the big guys like Krispy Kreme, which, you know, obviously use a lot of oil that are hurting? Or are there other companies, smaller companies, feeling the unintended consequences of these efforts to make lower-carbon motor fuel?

Justin Jacobs
The head of the American Bakers Association told us that, you know, they support this push for renewable fuels broadly and they support the green agenda, but they’ve seen their input prices triple. And, you know, they have members like Krispy Kreme and smaller bakers who are worried that they just might not be able to find oil when they go out into the market. So they’re very concerned about this. And, you know, they’re calling for, you know, a pause to some of these projects and some of the biodiesel mandates just to let the market react to this kind of surge in demand that they’re seeing.

Marc Filippino
How is the spike in soyabean oil prices affecting other countries and their plans for biofuels?

Justin Jacobs
Yeah, so you do see, you know, these kind of targets for producing biofuels in other countries. And these high prices have already forced Brazil and Argentina to reduce their biodiesel mandates. So, yes, that is something we’ve seen. And, of course, people who are growing soyabean in those countries, you know, they wanna to sell it while prices are high. So, yes, this is definitely having, you know, ripple effects across the global economy. And, you know, this is the first time we’ve seen this food versus fuel debate. We saw it, you know, around a decade ago when corn ethanol, that industry, rose very quickly. So, you know, I think we’re seeing some echoes of that today.

Marc Filippino
So, Justin, since we’ve been through this kind of thing before, is there anything that we can take away from that era and, you know, maybe apply towards what’s happening now?

Justin Jacobs
Yeah. So I think to me, the critical issue for the oil companies going into this space is that they’re just gonna have to find alternative feedstocks that work. Because I think it’s pretty clear from what we’re seeing today that simply buying up the world’s soyabeans is not going to be a viable, sustainable strategy for this. I think they’re gonna to have to find other sorts of feedstocks, of other sorts of oils, recycled oils, reused oils, those sorts of things that to create these these diesel products. Because, you know, you can’t get into a situation where you’re driving up global food prices to make diesel. It’s not just not a sustainable strategy for them.

Marc Filippino
Justin Jacobs is the FT’s Houston correspondent. Thank you, Justin.

Justin Jacobs
Thank you.

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Marc Filippino
The social media app Parler returned to the Apple App Store this past spring. Parler is the rightwing app that the big app stores banned after Donald Trump supporters attacked the US Capitol on January 6th. Parler now has a new CEO. He helped to negotiate its return to the App Store. Here he is on Fox News earlier this summer.

Clip of George Farmer
We are the first line of defence when it comes to when it comes to free speech.

Marc Filippino
That is George Farmer. He’s 31 years old and an Oxford graduate. He worked at a hedge fund owned by his father and he was involved in UK rightwing politics before making his way across the Atlantic to lead Parler. And he knows very well the influential pro-Trump activist Candace Owens.

Clip of Candace Owens and George Farmer
And introduce you guys to my fiancée, future husband, George Farmer. Welcome to the Candace Owens show. Hi, babe. (laughter)

Marc Filippino
Our tech correspondent Hannah Murphy recently interviewed George Farmer and talks about his connection with Owens.

Hannah Murphy
They met at an event in London and then got engaged after two and a half weeks. And I think he threw her, met some of these circles.

Marc Filippino
Hannah says Farmer’s plan is to grow Parler’s user base, but he’s facing more competition these days.

Hannah Murphy
So it’s it’s a space that’s really growing, these sort of conservative, smaller free speech apps. You’ve historically had Gab, Parler, and more recently, a few new entrants. So Gettr that’s G-e-t-t-r, that was set up by a former Trump adviser. And then we’ve also had Rumble, which is a sort of YouTube clone that is also coming to the fore. And that, I believe, has gotten some traction.

Marc Filippino
You can read more about Hannah’s interview with Parler CEO George Farmer and the rest of the stories you heard today at FT.com. This has been your daily FT News Briefing. Make sure you check back tomorrow for the latest business news.

This transcript has been automatically generated. If by any chance there is an error please send the details for a correction to: typo@ft.com. We will do our best to make the amendment as soon as possible.