U.S. reportedly considering banning imports of Rusal, aluminum rose 7%
Financial Associated Press, October 13 (Editor Xia Junxiong) According to media reports citing sources, the Biden administration is considering a full import of Russian aluminum as a response to the recent escalation of the situation in Russia and Ukraine. Previously, because aluminum is widely used in various fields such as automobiles, electronics and skyscrapers, the West has not included Rusal in sanctions. Affected by this news, it once rose 7%.
(Source: Yingwei Finance) People familiar with the matter said that the White House is considering three options: one is to ban Rusal altogether, the other is to raise tariffs to punitive levels, and the third is to sanction Rusal.
The move will have wide-ranging ramifications for the global aluminum market, and consuming countries, including the U.S., may need to rush to find alternatives.
Russia is the world’s second-largest aluminum producer, accounting for regarding 6 percent of global production, while Rusal is Russia’s only primary aluminum producer, producing 3.76 million tons in 2021.
Aluminum is vital to most heavy industries, and in the case of the United States, Rusal traditionally accounts for regarding 10 percent of the country’s aluminum imports. Russia was the U.S.’s third-largest aluminum exporter in August, data showed.
People familiar with the matter also said that the U.S. government did not sanction Rusal in the early days of the Russian-Ukrainian conflict, because it was worried that it would disrupt the global supply order. However, following the recent escalation of the situation in Russia and Ukraine, the United States decided to respond. However, as the war entered In the eighth month, fewer Russian products are available for the U.S. and its allies to ban.
The question of whether to ban Rusal has been a hot topic in the metals industry in recent weeks. The LME (London Metal Exchange), the world’s largest industrial metals exchange, is also considering banning the trading of Rusal.
Alcoa, the largest U.S. aluminum producer, sent a letter to the LME last month saying the Rusal deal should not be allowed. However, although the West has not yet sanctioned Rusal, some big buyers in Europe and the United States have long been shunned by Rusal because of the chilling effect of the sanctions.