Russia's aluminium association warns price drops and sanctions may hurt the industry

Russia’s Aluminium Association has cautioned the domestic industry of the adverse effects of Western sanctions, tariffs, and price drops.

The global aluminium prices have dropped to their lowest level since March 2021, while the US and EU almost banned Russian exports. Furthermore, the Russian aluminium products will likely face the 12th package sanctions by the European Union. According to the association, all this may adversely affect the Russian aluminium industry.

The association has warned that the Russian aluminium industry is on the verge of a severe crisis, adding that several enterprises of Rusal are even at risk of closure.

On Monday, December 11, the association highlighted that a number of Rusal enterprises are operating on the verge of zero or negative profitability. Any further deterioration of the present economic situation or increase in financial crisis may require enterprises to shut down their operations.

The association also warned that around 5,000 jobs in the Russian aluminium industry and 30,000 jobs in allied sectors are at risk.

Industry experts noted that profitability for Russian aluminum producers dropped by 13 per cent. Consequently, many strategically important investments in the sector would cease, entailing negative economic impacts, especially in regions highly dependent on aluminium production.