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Hello and welcome to World Business Report from the BBC World Service.
I'm Roger hearing and on this edition, the plane crash in India that's left more than 240 people dead.
As investigations begin, what will it mean for Air India and for the plane maker Boeing.
Also, we speak to the premier of the Canadian province of Alberta on the relationship with the U .S. tariffs, and a plan to a new oil pipeline.
Also, the problems Americans have with affording their favorite meat.
A lot of people can't afford the steak, so they're choosing down to still get the meat experience.
And how Meta, Facebook's parent company, is buying into new geothermal energy technology to power its AI programs. But let's start with Canada.
The Canadian province of Alberta is a landlocked neighbour of the United States.
It is also the country's main oil producer and it's been exporting oil to the U .S. for decades.
The recently challenging trade relationship with Washington however has caused some issues with exports and Canada is looking to diversify its oil destinations.
This week the premier of Alberta, Danielle Smith, has put forward a plan build a new crude pipeline from Alberta to the port of Prince Rupert in British Columbia in order to export through the Pacific.
The pipeline would come with a carbon capture and storage project as well, and she's hoping a private sector proponent will take the lead in this.
Well, I've been speaking about all this to the premiere, Danielle Smith.
Well, we've had a number of projects that have been proposed in the past. It would take our oil to different markets on our West Coast and on our East Coast. But because of various barriers and regulations, we haven't been successful in getting those to the finish line.
The federal government did step in and they built the Trans Mountain Pipeline.
And so that opened up last year and is now exporting heavy oil internationally to Korea, to China, to other jurisdictions.
And so I think it's proven the case that this is the reason why we need to look at doing more of this.
And so the next big project we would like to do is resurrecting an idea was having a pipeline that would go to the northwest B .C.
coast but it is going to require a change of policy in order to create the environment for a proponent to come forward to invest in that.
And also, I guess, because you don't particularly want to send it south at the moment.
I mean, the restrictions, the tariffs, the whole import issue with the United States, I guess is what's behind it.
I would say that one of the perhaps misconceptions, I know that the US president has made a lot of threats, but one of the things that Canada enjoys is the Canada -US Free Trade Agreement.
All goods that are compliant with the Canada -US Free Trade Agreement have no tariffs on them.
So currently all of our oil and gas, all of our food products, all of our intermediate goods are going into the United States tariff free.
They have punished us, along with the rest of the world, on steel and aluminium and cars and timber.
And we do hope that we'll be able to restore some of that spirit of that agreement soon.
I'm reading stories about our prime minister, Mark Carney, and the US president closing in on a new security and economic partnership.
So I think that will be good to restore those ties because we do have a very strong relationship with the United States.
We sell about $188 billion worth of goods and services from our province alone, most that oil and gas.
And when you got pipelines that are are piped directly into the American system, it's not very easy to switch gears from that kind of relationship.
But what you have to do is find new ways to build new pipelines to get to new markets.
And so that's why we're trying to have an all of the above approach. Okay, but apart from the oil, I mean, Alberta's only just started buying US alcohol again, because there was a long pause in order to fight tariffs.
I mean, are things changing?
Are you now going back to normal as it were with US.
You said in fact the trade agreement still exists.
Well the thing to remember is that our province Alberta is hosting the G7 in the coming days and so we're going to have a very large delegation including the United States president coming to our our province and it was raised to me by the US ambassador that America does not ban the import of any Canadian good.
And so we always felt like we needed to have a proportionate response.
In the view of my caucus that didn't seem proportionate.
So it's part of the reason why we got rid of the ban.
There is still a 25 % import tariff because the federal government has imposed import tariffs as a way of retaliating against the steel and aluminum and auto parts tariffs.
But I would say that we have are attempting as a measure of goodwill.
And hopefully, a way of creating a pathway back to a more normalized relationship with the United States.
And so it just made sense for us to make that It sounds a little bit desperate, I have to say, you know, you're saying let's make nice with them, perhaps it's typically Canadian but they don't seem to be being nice back.
We are an economy in Canada that is one tenth the size of the United States and so thinking that you can win a trade war I think is probably not in our best interest. I think what happens when you have tariffs is you end up hurting Canadian consumers, you end up hurting Canadian businesses, tariffs in my view are their own punishment.
They really are taxing their own citizens.
And so I think that my role has always been to take more of a diplomatic approach of trying to return to the historically good relationship that we've had with the United States.
Is a such a vitally important relationship that from an economic point of view that I don't think that there's any point in trying to outdo the Americans on how much we can harm our own people, that has never really felt to me like the best approach. Donald Trump, of course, has spoken about maybe taking Canada as a 51st state.
But meanwhile, Alberta, it seems, is thinking about independence even from Canada.
Is that going to happen?
I have told the Americans that they should be careful what they wish for because having Canada join the United States would be like adding an additional California.
And I think that they'd never see another Republican in the White House again.
So that's - so I think that might be a miscalculation on the part of the US President.
But what about the referendum for independence?
We've heard a lot about that people pushing for it.
Would you accept that there should be a referendum for Alberta to become independent?
I think that we have to understand why people are frustrated.
We've seen it ebb and flow.
And it's at the highest level that I've ever seen it.
And I think it can also dissipate very easily if the federal government corrects the terrible policies that they put in place over the last 10 years.
We've had something in the order of 500 billion dollars worth of projects canceled because of the hostile policies against oil and gas development.
And so if you could imagine any region in the world where a central government kills $500 billion worth of investment is going to feel antagonised and there's going to be a reaction to that.
But I've also seen that good policy allows for those kind of sentiments to subside and so that's the challenge for Prime Minister Mark Carney.
And he could perhaps eventually face President Daniel Smith.
Well, I have sworn an oath to His Majesty, so maybe it would be the Commonwealth of Alberta.
But my preference is to have a strong Alberta within a united Canada.
I think we're much stronger together.
We just have to make sure that Team Canada is on Team Alberta.
And it hasn't always been that way in the last 10 years.
Danielle Smith, still Alberta's premier.
Now, let's turn our attention to that terrible crash in India.
It was, it took off from Ahmedabad airport and crashed very shortly after earlier on Thursday, killing more than 240 people.
The cause of the disaster is still unclear but it has left grieving families in India and the UK where the flight was headed.
Eyewitnesses in the city told the BBC what they saw.
I was sitting at home, it felt like an earthquake.
I went down and saw a small.
I didn't know it was a plane crash and I came here and found out and I saw the crash plane.
There were many bodies lying on the ground.
In Ahmedabad, the Indian Civil Aviation Minister, Ram Mohan Naidoo, promised there would be a full investigation.
I'm totally shaken by the incident that has happened today, near Ahmedabad airport.
Very tragic and very, very horrific.
We are going to do a fair and thorough investigation.
We are not going to spare anyone, we are not going to leave any stone unturned." Well the incident has already led to some questioning of the safety record of Air India and of Boeing, the company that made the 787 Dreamliner.
Well let's talk now to Anita Mendirata, a specialist on aviation, who's joining us on the line from Toronto.
Anita thanks for being with us.
I should point out that Boeing has actually issued a statement about this, Kelly Autberg saying our deepest condolences go to the loved ones of the passengers and crew onboard Air India flight 1 7 1 as well as everyone affected in Ahmedabad and that the Boeing team stands ready to support the investigation.
So clearly Boeing are feeling they need to input at least some elements of trying to find out or help find out what went on but of course Air India was the airline involved so Anita what's the situation with Air India they'd only really begun to recover as a company from quite a bad time recently anyway?
Indeed Air India is an important airline within the global aviation portfolio, because ultimately, it's the flag carrier of a very proud subcontinent.
So Air India being reacquired by the Tata Corporation was really coming back home and a combination of Air India and the Tata organization have really started the transformation of aviation in India through the invigoration of Air India.
So it's an important time for Air India and it's important to note that in 2023, they put a massive order in for new aircraft including 200 new Boeing 787s, which is a remarkable statement of confidence in Boeing as a partner in India's aviation growth, recognizing that India is the third largest aviation industry in the world after the US and China, expected to double a triple, I beg your pardon, in value by 2023.
So it's absolutely essential to the Indian economy this whole area and that I guess obviously people thinking initially about the relatives of the dead, those bereaved by this, but of course there is an economic potential to come from this in that people may begin to have doubts about Indian aviation.
You're absolutely right.
It's an important part of India's aviation growth.
It's actually the domestic market which Air India has always served, again, with great pride and with great aircraft. So the, any fear around aviation is going to stunt not only the economic growth of the country but the social growth of the country.
So, there are concerns around that, but looking forward as we look at this, there is a natural shock.
Aviation is a very emotive industry, whether you are a traveler, a professional, an audience member.
So, when we see an incident like we did today, it's traumatizing, even if one is simply watching it as an audience member.
And if we keep it in context, there are a hundred thousand aircraft movements every day around the world, when you look at global aviation, commercial, cargo, military, etcetera.
This one incident is incredibly unique and it is a worst -case scenario of all of these elements coming together.
For that reason, Boeing and Air India are working very closely together with, as you said up front, Kelly Orford, the new CEO, reaching out to Air India, making an overt statement about the company's support.
And very much Campbell Wilson, the CEO of Air India who came from Singapore Airlines, an outstanding leader and veteran in the industry, making an divert statements through a video message today to the world about Air India taking this fully responsibly to identify what happened.
But clearly something did go badly wrong Anita.
And I mean, we've talked about Air India.
But of course, Boeing must feel, I suppose, under some investigation in this, because not with this particular model, with a different model, they did have a very poor history in the recent past. This certainly does not help Boeing's quest to rebuild trust and reputation.
You're absolutely right in that regard and this is an important aspect.
The challenges they've had in the past were very much around the 737 Max and we know the issues that they had in terms of the two fatal crashes that went to legal proceedings last year.
They've had slowdowns on the production lines by the regulators.
They had strike action last year.
So when the new CEO took office in August last year coming out of retirement, he knew the challenge he was walking into but he's demonstrated overtly that courage, conviction, credibility and importantly compassion in leadership is vital.
Committing to not only shifting the future of Boeing going into the future to a positive level externally with investors and customers in the flying public but internally as a Boeing culture rebuilding its pride again as an icon in the U .S. and in global aviation.
But Anita the investigation is partly going to look at Boeing, and it's almost inevitable people will see headlines about Boeing in relation to a very bad accident, a catastrophe in many ways, it's really going to have a hard time.
I mean, is it going to continue, for example, to get support from the Trump administration?
It's interesting question, and importantly, Boeing will go under investigation as part of this incident as they should.
And they want to be a part of it, because ultimately the Indian Air Traffic Investigation some Bureau will be leading this investigation with Air India, with Boeing, with GE, the engine manufacturer and, as you've said, the U .S. authorities as well, because ultimately Boeing is a representation of the U .S. industry.
Is this going to have an impact with the Trump administration?
Who knows? I mean, this is all very speculative when it comes to that regard. There will be naturally a concern within the administration around what this will mean for Boeing.
We saw even before the markets opened today, a 7 % drop in share value.
But very interestingly that is a pattern for any airline that goes through a situation of this severity.
We've seen it in the past already, when we had a situation of China Eastern in March of 2022, having a fatal incident.
They dropped 7 .8%, ASEANA 2013, they dropped almost 6%.
The question is how does one recover?
And this is where Boeing's leadership is very important to manage the whole process.
It'll be interesting to see how it plays out.
Anita thank you so much for being with us.
Anita Menderata there.
Well let's pick up on what the market's made of all this.
Joining me is Walter Todd, President and Chief Investment Officer of Greenwood Capital in South Carolina.
Walter thanks for being with us once again and we heard there a little bit from Anita about how the shares played out.
How did it end when the final bell went?
Where were yeah roger good evening from the us here yeah so less than five percent as anita referenced at the lows pre -market i think it was down close to actually nine percent but closed down less than five percent ge aerospace which makes the engines for this aircraft was down less than three percent so perhaps a little bit surprising given you know obviously the tragedy that occurred to have it down that that little and interestingly perhaps suggesting that exactly as anita was suggesting there.
The Trump administration doesn't plan to pull the rug from under Boeing anytime soon.
No, I mean, they're, they're, you know, they're a very important company for the United States.
I think the administration is going to still be behind them, but obviously a lot of investigation to occur.
These, the 787 aircrafts actually made in the plant here in South Carolina.
A hundred percent now, the age of this aircraft may have been made in Washington state, but obviously I a vested interest in making sure Boeing is successful.
Indeed. Well, let's take our thoughts away from Boeing and put them onto something really interesting at the moment as well, which is the dollar price.
The dollar has dropped considerably in value, hasn't it?
It has. So, there are a couple different ways to measure the dollar.
The DXY index is the most commonly used one.
The Dixie, they call it.
Heavily weighted to the euro in the yen, it's down about ten percent on a year to date basis.
It's the lowest level since 2022 where it closed today.
So it's been under pressure all year but certainly kind of broke through the lows that we saw in in early April when the tariffs were announced.
So what does this mean?
Well why do they Todd?
Because I mean there's so much of of global debt is dollar denominated so it has an effect.
Yeah well it makes makes that debt cheaper to pay off I guess for other countries that have that have issued, foreign countries that have issued debt and US dollars is cheaper to pay it back.
The dynamic is it's inflationary for the US.
It makes our goods more competitive globally on an export basis.
I think the administration would never say this overtly but they kind of want a week a dollar to help kind of rebalance the trade dynamic.
It makes our goods cheaper.
It makes imports more expensive, but you gotta be careful.
It's a slippery slope.
You don't want it to be too weak over time.
But we're just kind of back into the range that we've been in for the past call at 10 10 years or so I know it's it's come down quite significantly very quickly But if you look at a longer term context, you know, we're still in a not a bad spot Walter Thank you so much for being with us Walter Todd there of Greenwood Capital You're with World Business Report from the BBC World Service Now in the last few hours Meta has announced a big investment into geothermal energy It's with the company XGS Energy.
The deal's going to see the Facebook owner by 150 megawatts of power from XGS in order to fuel its AI energy needs.
Well Alexander Kaufman has been writing about this for Latitude Media where he's a contributing reporter and he explained to me the idea and what it's going to mean.
Geothermal energy has actually been around for more than a century, but it has traditionally been confined to places with the right geological conditions for being able to access these really hot underground reservoirs.
And so, you know, you've had geothermal power in places like Iceland where it's very volcanic, in places like Kenya, and also in places like the Western United States.
If you can think of the geysers out in Yellowstone.
But there is a new generation of companies that are essentially using the newest technologies for oil and gas drilling, the things that powered the fracking boom in the US, to access geothermal heat in many more locations than ever before.
And so this family of our this sector that that's emerging has been very promising and exciting.
And Metta has made two investments in it so far one last year in a company called Sage Geosystems. And now today in a rival company with a different technology called xGIS Energy, and they're to buy 150 megawatts I gather from XGS.
I mean, how much of their AI energy needs, because AI is very energy hungry.
How much of that will it supply?" Well, that'll go entirely to supplying, you know, some of Facebook's AI data centers in New Mexico, where they happen to have a very large cluster of the 17 data centers that located in Albuquerque, which is New Mexico's biggest city right now.
Meta controls 11 of them and just got permission from the local government to embark on a rather large expansion.
150 megawatts is not a terribly large amount but at the stage that this technology is in its development right now, that type of early deal is enough to both allow the company to build its first plant and really prove out its commercial capacity to do a lot more of this and also it de risks it for other investors.
So you know, obviously a contract with a company as big as meta allows other investors to come in and see it as a more worthy counterparty for bigger deals.
And Alexander be clear, this is what we might call clean energy.
It's it doesn't have polluting effects, it doesn't cause the kind of problems I you mentioned, obviously, what it was used for fracking in the past, which many people did object to, but this essentially is clean.
That's correct. So obviously, the association with fracking is with natural gas and oil, which is what that technology was developed to extract.
And obviously that comes with a climate cost in terms of the greenhouse gas emissions that come from both the production and the burning of those fuels.
But the technology itself is really just a tool for digging deeper into rock.
And so what's happening in this case is these companies are using that technology to access the Earth's molten heat at much deeper depths than traditional geothermal companies could access, and allow them to use that to essentially run water down there that generates steam.
That steam can then be used to spin turbines and produce zero -carbon electricity.
And unlike other renewables, such as wind and solar, which are dependent on certain weather conditions, this is something that can run 24 -7.
So, it's a really promising technology not only in that it allows a lot of the workforce and the tech that was developed around fossil fuels to be passed on in an apples -to -apples kind of way, from the old energy source and the new one.
Alexander Kaufman speaking to me earlier.
Now, Americans are firing up their grills this summer, but they're getting a little bit singed by the cost of beef.
Prices continue to rise with some cuts reaching all -time highs.
Monica Miller went to try to find out why.
Uncle Jack's Steakhouse in New York is a known quantity in certain circles.
There are framed pictures at the entrance of famous patrons like billionaire Michael Bloomberg and a framed autograph of social media influencer Kim Kardashian with lipstick kiss.
The owner calls it his Wall of Fame.
William Deagle, Uncle Jack's owner, entrepreneur, a .k .a.
the steak doctor. A porterhouse steak for two was listed on the menu at an eye -watering $165, but these days an increase in beef prices has Mr. Deagle offering new menu items that most customers can afford. I evolved my menu, right?
I evolved the menu to have more burger cuts, more steak sandwich cuts.
So right now we have an Uncle Jack steak sandwich. I've always had it, but now I have a French dip.
So the steak sandwich is grilled filet mignon, and then the French dip is roasted prime, you know, ribs shaved super thin because a lot of people can't afford the steak.
So they're choosing down, to still get the meat experience.
Hamburgers are popular items on home grills during the summer.
The latest figures show the average pound of ground beef in May was close to six dollars, a 16 % increase compared to last year.
One reason why beef prices are so high is the U .S. has the lowest cow inventory in over 70 years.
The business wasn't profitable, according to Michael Swanson, agricultural economist for Wells Fargo.
I mean, when you don't make money, you stop doing what you do or you do less of it, simple as that.
High living expenses, droughts and an increase in grain prices are some reasons that have discouraged farmers from raising more cattle or have gone out of business altogether.
The U .S. sells high -end cuts like steak to the international market.
But it primarily buys what's considered hamburger meat, or what's sometimes called grind from abroad.
Right now, the U .S. imports more beef than it exports.
Will you go to the supplemental market about 20 % or 15 % depending how you want to calculate it on the grind side?
Australia, Brazil, places like that.
Why? Because they have large cattle herds that are out on the grass walking around.
not really to our taste for steaks, but certainly make a good hamburger.
Mr Swanson says terrorists will have an impact on prices, but despite the sticker shock at the checkout, Americans are the world's largest consumers of beef.
Cattle farming could see a resurgence in the US, but high prices usually bring more production.
There's a lot more nice pickup trucks hunting on the road today in cattle country.
Roughly 85 % of the industry is run by a few large companies and the job outlook for cattle farmers is declining but some young farmers see an opportunity in the marketplace.
Jake Castagna is a mortgage broker but his side hustle is running JR's cattle ranch in New Jersey with the help of his partner and a small staff.
Never an easy day whether it's the cows getting out, knocking fencing over, escaping, having to wrangle them back up to get them back in.
They've been in business now for about a year -and -a -half, raising grass -fed organic black Angus.
But Mr. Kistagnis says that the long days aren't the hard part of the job.
It's keeping up with the cost of fuel, grass seed, and hay.
There's also stiff competition from property developers.
9 out of 10 times, you're gonna get beat out by someone, you know, overpaying millions of dollars.
They want to turn, you know, 100 houses on the property.
So, for them, you know it's an investment.
For farmers, it's a lot tougher, especially out here, price of land is 50 -100 ,000 n.
He says they absorb a lot of the additional costs in order not to raise prices.
Right now business is growing and the hard work is paying off.
We have great customers.
They are willing to pay it.
People don't want to go to the supermarket any more.
They don't know what they are getting.
You don't know what you are buying.
So, you know, once we once we get the customers in they're always usually returning customers one day mr Kestagnas says he would like to run the farm full time, but until the industry becomes more profitable He's going to have to stick to his day job Monica Miller there finding out why for some Americans the beef is well a bit rare Anyway, that's it from World Business Report for me the rest of the team, but I thanks for listening I'm Zing Zing and Simon Jack.
And together we host Good Bad Billionaire, the podcast exploring the lives of some of the world's richest people.
In the new season, we're setting our sights on some big names.
Yep, LeBron James and Martha Stewart to name just a few.
And as always, Simon and I are trying to decide whether we think they're good, bad or just another billionaire.
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