US takes action targeting Russian aluminum, copper and nickel

Reuters| April 12, 2024 | 2:28 pmIntelligenceRussia and Central AsiaUSAAluminumCopperNickel

Aluminum factory in Russia.(Reference image by uc_rusal_photo_gallery,Wikimedia Commons.)

The United States on Friday prohibited metal-trading exchanges from accepting new aluminum, copper and nickel produced by Russia and barred the import of the metals to the U.S.

The Treasury Department action, aimed at disrupting Russian export revenue from the metals, comes as Washington has sought to punish Moscow for its invasion of Ukraine, which has killed or wounded tens of thousands and reduced cities to rubble.

Russia is a major producer of aluminum, copper and nickel.

The Treasury Department said Friday’s action would prohibit the London Metal Exchange and Chicago Mercantile Exchange from accepting new Russian production of aluminum, copper, and nickel.

“Metal exchanges provide a central role in facilitating the trading of industrial metals around the globe,” the department said in a statement.

Available aluminum stocks in London Metal Exchange-registered warehouses were 91% of Russian origin in March, unchanged from the previous month, LME data showed on Wednesday.

The high share of Russian-origin metal in LME inventories has been a concern for some producers, which compete with Russia’s Rusal, and some Western consumers who have avoided Russian metal since Moscow’s invasion of Ukraine in 2022.

The share of Russian-origin copper stocks rose to 62% in March from 52% the previous month and the share of Russian nickel rose to 36% from 35% over the same period, the LME said.

(Reporting by Daphne Psaledakis and Katharine Jackson in Washington and Polina Devitt in London; Editing by Cynthia Osterman)

https://www.mining.com/web/us-takes-action-targeting-russian-aluminum-copper-and-nickel/
________________________________________________________________________________________


WOW, this is going to impact the Copper Price!!!

Image from a LME copper trader perspective what this US Treasury ban means:

Disruption to copper supply: Russia is a major producer and the ban cuts off access to a significant chunk (62%) of copper traded on the London Metal Exchange (LME), a key marketplace.
Potential price increase: Reduced supply with steady demand could push copper prices higher.
Sourcing challenges: Finding alternative sources of copper to replace the banned Russian metal could be very difficult. This might involve higher prices from other producers.
Market volatility: Uncertainty surrounding the ban's impact and how other countries react could lead to price swings in the short term.

Overall, the ban is likely to cause a supply squeeze and potentially inflate copper prices. However, the market will have to adjust to new sources and the long-term impact remains to be seen.