Business groups say bans on Russian aluminum will decimate European industry

Oct 24 (Reuters) – Five European industry groups said on Monday they had urged European authorities to prevent sanctions, tariffs or boycotts on Russian aluminum which they said could put thousands of companies out of business.

Russia’s Rusal (RUAL.MM) produces around 6% of the world’s aluminum. This metal was not targeted by Western sanctions against Russia after its invasion of Ukraine.

However, the US is considering restrictions on Russian aluminum imports, and the London Metal Exchange (LME), the largest trading center for metals, is asking members whether they should ban Russian material from their system. Continue reading

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Some companies have said they will stop buying Russian aluminum and others, like US producer Alcoa (AA.N), are lobbying for action against Russian metal. Continue reading

In a joint statement, the associations said they had sent a letter to EU authorities, “calling for urgent action by the European Commission and EU member states against threats of bans, high tariffs or sanctions on Russian aluminium, which is an immediate and vital pose a threat to the European aluminum industry.”

The statement said that those boycotting Russian metal or calling for action against Russian metal “are either its main competitors, or they enjoy supply options unavailable to the vast majority of Europe’s aluminum value chain.”

For smaller aluminum consumers in Europe, action against Russian metal “risked potentially thousands of business closures and tens of thousands more unemployed in Europe as a direct result,” it said.

European industry is under pressure from high inflation and rapidly slowing economic growth, while high energy prices have shut down more than a million tonnes of aluminum production in Europe since 2021.

In 2018, after the United States sanctioned Rusal and the LME blocked its metal, aluminum prices shot up 35% in a matter of days.

The five federations are the Federation of Aluminum Consumers in Europe (FACE), the Federal Federation for Economic Development and Foreign Trade (BWA), the Federation of Italian Foundry Suppliers (Amafond), the Italian National Federation of Steel, Metals, Scrap, Hardware (Assofermet) and the Italian Foundry Association (Assofond).

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Reporting by Peter Hobson and Pratima Desai; Edited by Bernadette Baum

Our standards: The Thomson Reuters Trust Principles.

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