https://sputnikglobe.com/20230613/lme-growing-more-reliant-on-russian-aluminum-as-sources-from-other-players-dwindle-1111100743.html
LME Growing More Reliant on Russian Aluminum as Sources From Other Players Dwindle
LME Growing More Reliant on Russian Aluminum as Sources From Other Players Dwindle
Sputnik International
The London Metal Exchange (LME) aluminum contract is increasingly dependent on Russian-origin metal, according to recently published data cited in media reports.
2023-06-13T08:11+0000
2023-06-13T08:11+0000
2023-06-13T09:17+0000
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The London Metal Exchange (LME) aluminum contract is increasingly dependent on Russian-origin metal, according to recently published data cited in media reports.The proportion of the important industrial metal sourced from Russia rose from 52% in late April to 68% at the end of May, judging by warehouse data of the commodities exchange. The LME, which had been pressured by the West in 2022 to ban deliveries of Russian metal amid the ongoing sanctions campaign targeting Moscow, resisted the calls. Some leading aluminum producers in the West, like Alcoa Corp., urged the LME to ban the Russian metal from its contract - something that the exchange refused to do. Harvey said it isn’t “sensible” that the rest of the world continues to curtail capacity while Russian producers continue to operate at full capability.Amid warnings that soaring Russian aluminium stocks in warehouses registered with the London Metal Exchange might ostensibly "distort" the benchmark price for the metal, LME released the inventory figures, underscoring there was sufficient consumer appetite for Russian metal.This reportedly comes as trading house IXM, a global merchant in base and precious metals, has been accepting delivery of non-Russian aluminum, while rejecting one of the most in-demand industrial metals coming in from its third-largest producer, sources were cited as saying. One of the largest traders of physical non-ferrous metals owned by China’s CMOC Group Ltd. purportedly feared that there might not be enough customers buying Russian metal.Russia is one of the world’s largest producers of aluminum, a metal that is a key part of the defense industrial base. Last year, Russia produced 3.7 million MT of aluminum.While the US and its allies have not hesitated to impose round upon round of sanctions on Russia over the Ukraine conflict, aluminum was not targeted, however, and Russian base metals continue to be traded and stored by the LME. However, the flow of Russian metal into the LME's US-registered warehouses was put on hold after sanctions-happy Washington announced a new duty on all imports of aluminum from the country in February. The White House had issued A Proclamation on Adjusting Imports of Aluminum Into the United States, stating that as of March 10, 2023, a 200-percent duty on "aluminum articles that are the product of Russia and derivative aluminum articles that are the product of Russia". Following the US announcement this year, Canada banned the import of aluminum products from Russia, effective immediately, on March 10. Since then, the UK also announced it was prohibiting the import of Russian copper, aluminum, and nickel, as well as Russian diamonds, according to a statement issued by Britain's Prime Minister Rishi Sunak.However, as other countries follow the US-led sanctions policy to their own detriment, with the restrictions exacerbating Europe's energy crisis and pushing Europe into further de-industrialization, Russia has been reorienting its market and boosting relations with friendly countries. Thus, China has been importing more aluminum from Russia. Sales of refined aluminum to China soared almost threefold in April from the previous year to 88,859 tons, according to Chinese customs data. Furthermore, Chinese buyers are offered a chance to pay in their own currency, advancing Beijing’s efforts to globalize the yuan amid the increasing trend towards de-dollarization.
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london metal exchange, lme, aluminum contract, dependent on russian-origin metal, warehouse data, important industrial metal, sourced from russia, commodities exchange lme, ongoing sanctions campaign targeting moscow, one of the world’s largest producers of aluminum, metal key for defense industrial base, sanctions on moscow- based rusal
london metal exchange, lme, aluminum contract, dependent on russian-origin metal, warehouse data, important industrial metal, sourced from russia, commodities exchange lme, ongoing sanctions campaign targeting moscow, one of the world’s largest producers of aluminum, metal key for defense industrial base, sanctions on moscow- based rusal
LME Growing More Reliant on Russian Aluminum as Sources From Other Players Dwindle
08:11 GMT 13.06.2023 (Updated: 09:17 GMT 13.06.2023) In February, when the US announced a package of trade restrictions against Moscow over its special military operation in Ukraine, targeting metals, minerals and chemicals, it was revealed that 200% duties would be imposed on Russian aluminum, also on imports from other countries that contain Russia-origin aluminum.
The London Metal Exchange (LME) aluminum contract is increasingly dependent on Russian-origin metal, according to recently published data cited in media reports.
The proportion of the important industrial metal sourced from Russia rose from 52% in late April to 68% at the end of May, judging by warehouse data of the commodities exchange. The LME, which had been pressured by the West in 2022 to ban deliveries of Russian metal amid the ongoing
sanctions campaign targeting Moscow, resisted the calls.
Some leading aluminum producers in the West, like Alcoa Corp., urged the LME to ban the Russian metal from its contract - something that the exchange refused to do. Harvey said it isn’t “sensible” that the rest of the world continues to curtail capacity while Russian producers continue to operate at full capability.
Amid warnings that soaring Russian aluminium stocks in warehouses registered with the London Metal Exchange might ostensibly "distort" the benchmark price for the metal, LME released the inventory figures, underscoring there was sufficient consumer appetite for Russian metal.
"This suggests that Russian aluminium continues to flow through the warehousing network, and that a meaningful set of global consumers continue to accept Russian metal," said LME.
This reportedly comes as trading house IXM, a global merchant in base and precious metals, has been accepting delivery of non-Russian aluminum, while rejecting one of the most in-demand industrial metals coming in from its third-largest producer, sources were cited as saying. One of the largest traders of physical non-ferrous metals owned by China’s CMOC Group Ltd. purportedly feared that there might not be enough customers buying Russian metal.
Russia is one of the world’s largest producers of aluminum, a metal that is a key part of the defense industrial base. Last year, Russia produced 3.7 million MT of aluminum.
While the US and its allies have not hesitated to impose round upon round of sanctions on Russia over the Ukraine conflict, aluminum was not targeted, however, and Russian base metals continue to be traded and stored by the LME. However, the flow of Russian metal into the LME's US-registered warehouses was put on hold after sanctions-happy Washington announced a new duty on all imports of aluminum from the country in February.
The White House had issued A Proclamation on Adjusting Imports of Aluminum Into the United States, stating that as of March 10, 2023, a 200-percent duty on "aluminum articles that are the product of Russia and derivative aluminum articles that are the product of Russia".
Following the US announcement this year, Canada banned the import of aluminum products from Russia, effective immediately, on March 10. Since then, the UK also announced it was prohibiting the import of Russian copper, aluminum, and nickel, as well as Russian diamonds, according to a statement issued by Britain's Prime Minister Rishi Sunak.
However, as other countries follow the US-led sanctions policy to their own detriment, with the restrictions exacerbating Europe's energy crisis and pushing Europe into further de-industrialization, Russia has been reorienting its market and boosting relations with friendly countries. Thus, China has been importing more aluminum from Russia.
Sales of refined aluminum to China soared almost threefold in April from the previous year to 88,859 tons, according to Chinese customs data. Furthermore, Chinese buyers are offered a chance to pay in their own currency, advancing Beijing’s efforts to
globalize the yuan amid the increasing trend towards
de-dollarization.
