Norsk Hydro calls for EU, US sanctions on Russian aluminium

25th October 2022

By: Reuters


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OSLO - Norwegian aluminium-maker Norsk Hydro called on Tuesday on the United States and the European Union to stop importing Russian aluminium onto their territories, its chief executive told Reuters.

About half of Europe's aluminium production has been shut down as a result of a surge in energy costs since Russia's invasion of Ukraine, while Russian output has been unaffected.

Russia's Rusal RUAL.MM, 0486.HK produces around 6% of the world's aluminium. This metal has not been targeted by Western sanctions against Russia following its invasion of Ukraine.

But the US is considering restrictions on Russian aluminium imports and the London Metal Exchange (LME), the biggest metals trade hub, is asking members if it should ban Russian material from its system.

"We want to urge sanctions in both Europe and the US," Hydro CEO Hilde Merete Aasheim told Reuters. "Our European industry shuts down, while ... we see Russian production at the same level as before the invasion. So they are benefiting."

Hydro produces most of its aluminium in Europe, Qatar, Brazil and Canada. It has no production in Russia and has stopped trading in Russian aluminium in the wake of the February 24 invasion of Ukraine.

Producing the metal, used in the automotive, packaging, construction industries among others, is highly energy-intensive.

Without sanctions against Russian imports, the future for European production would be at risk, Aasheim said, because Europe's producers, facing soaring energy costs, would be unable to compete against Russian rivals.

"It is an energy-intensive business, and when the gas has been cut from Russia we see the effect on the power prices, so what is important over time is to get in more renewable power," she said.

Aasheim's comments echoed those of US peer Alcoa's, which is urging the White House to block US imports of the metal from Russia.

With recession looming, however, some business groups say bans on Russian aluminium would decimate European industry.

Edited by Reuters



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