Bloomberg: Aluminum prices rise in anticipation of new EU sanctions

29 January 14:21

The new EU sanctions package proposes to ban imports of Russian aluminum. The plan, which has been circulated among EU member states, would allow European buyers to import 275,000 metric tons of the Russian metal under a quota system for one year before a full ban takes effect. Bloomberg reports this with reference to sources familiar with the matter, Komersant ukrainskyi informs.

The agency reminds that calls for the European Union to ban imports of Russian aluminum have been heard since Russia’s invasion of Ukraine, and Russian supplies to the EU have been steadily declining as producers have sought alternative sources of supply. But some buyers and EU member states have so far resisted such measures on the grounds that some key products would be difficult to fully replace.

According to UN Comtrade, in the first 11 months of 2024, the EU purchased about 320,000 tons of unprocessed aluminum from Russia, accounting for 6% of total imports. Meanwhile, Russian sales to China have surged.

Bloomberg reports that on the London Metal Exchange, aluminum prices rose 0.7% to $2,590 per ton.

The agency reminds that in recent months, pressure has increased to impose tougher measures on Russia’s metals sector. Last year, the United States and the United Kingdom imposed a ban on trading in Russian metals on the London Metal Exchange, which initially caused wild price fluctuations on the exchange and accelerated the change in global trade flows.

The publication also states that metals traders remain focused on the potential consequences of a US-led trade war. White House Press Secretary Caroline Leavitt confirmed the day before that duties on goods from China, Canada and Mexico will take effect on February 1.

What is known about the new EU sanctions package

The sanctions package to be adopted on the eve of the third anniversary of Russia’s invasion of Ukraine was circulated among EU member states this week. The sanctions proposed in the package will include the disconnection of more Russian banks from the SWIFT system, as well as actions against more than 70 “secret fleet” vessels involved in the transportation of Russian oil. The European Union is also considering a phased ban on imports of Russian aluminum.

According to Bloomberg, there is no guarantee that the EU will agree on this 16-pack of anti-Russian sanctions.

The publication reminds that this week the EU tried to confirm the traditional six-month extension of the sanctions regime against Russia, and Budapest lifted the blocking of this step only a few days before the expiration of the sanctions.

Василевич Сергій
Editor