US sanctions on Rusal may shift global aluminium supply landscape

Published: Apr 10, 2018 11:05

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The US sanctions on Russian aluminium major Rusal is not expected to lead to a global shortage, SMM believes.

SHANGHAI, Apr 10 (SMM) – US sanctions on major Russian aluminiumproducer Rusal are not expected to lead to a global shortage, SMM believes.

LME aluminium jumped 2% on Monday April 9 to close at $2,082/mt as the market was concerned over Rusal’s supply of 7% of global aluminium, according to brokerage firm Argonaut.

Its data also showed that Rusal accounted for about 7% of global alumina output and 4% of global bauxite supply.

While the move will not cause a shortage, SMM senior analyst Liu Xiaolei believes it is likely to have an impact on the global aluminium supply landscape.

It remains unclear if US buyers will be able to find a substitute for their aluminium ingot demand. Spot premiums for North America are also likely to rise in a tighter market.

Liu added that LME aluminium prices are set to be supported in the short term.

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Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

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