EU sanctions 'not particularly sensitive' for Russian aluminum industry, exports falling anyway - minister

MOSCOW. Feb 20 (Interfax) - The ban on aluminum product supplies from Russia that the EU is expected to include in its 16th sanctions package of will not have a material impact on the aluminum industry, as companies will look for alternative export destinations, Russian Industry and Trade Minister Anton Alikhanov said.

"I think [the anticipated EU decision] is not particularly sensitive given that we have been reducing supplies in recent years. We will look for markets to replace them," he told journalists on the sidelines of the Future Technologies Forum.

The Financial Times said on Wednesday that EU countries had agreed new restrictions on Russia, some of them in relation to the banking sector, oil tankers and supplies of certain types of aluminum products. Reuters quoted its own sources as saying the ban would apply to primary aluminum.

Russian aluminum exports to Europe have been declining since 2022 as European manufacturers moved away from Russian products. In addition, an April 2024 ban on Russian non-ferrous metals on the LME impacted exports. Selling to LME warehouses had been a key fallback option for Russian metal, most of which is sold through bilateral contracts.

Rusal , the largest aluminum producer outside China, with approximately 6% of the global market share, has had to restructure its supply chain. Europe's share dropped to 22% by the end of H1 2024 from 31% a year earlier.

According to BCS estimates, the European market now accounts for around 12% of Rusal's exports, or 9% of its production. Sinara estimates Rusal's shipments to the EU at 4% of the company's sales. Rusal could redirect these exports to the Chinese market, given strong demand in China, BCS said.