CRU aluminum news roundup: Sanctions and anti-trust worries

EA and Rusal react to new sanctions
The European Aluminum association published a statement following the new sanctions imposed on Russian aluminum. The association welcomed the sanctions and urged the EU to take comparable actions.

European Aluminium noted that failure to do so would leave the EU in “the bizarre position of being alone among Western powers in continuing to finance Russian aggression through the purchase of aluminum.” Doing nothing also would undermine the competitiveness of European producers, the association said.

“The risk of the EU market being flooded with products from third countries, produced using heavily discounted Russian metal, is greater than ever,” the EA warned before adding: “Failure by the EU to react decisively to these latest developments would be an ethical, strategic, and economic disaster that Europe simply cannot afford.”

Russian producer Rusal also reacted to the news by downplaying the impact of the sanctions on its activities.

“Rusal will remain capable of providing hedging services to our customers and remains committed to market-based pricing,” the company said before adding that these actions will have no impact on its ability to supply since Rusal’s global logistic delivery solutions, access to the banking system, overall production, and quality systems are not affected.

Rusal also noted that the U.S. determination does not impose any new prohibitions or requirements relating to the processing, clearing or sending of payments by any intermediary banks. Also, it stressed the LME acknowledgment that a still large proportion of the market is willing to take delivery of Russian aluminum.

Anti-trust worries delay Russel’s acquisition of service centers
Toronto-headquartered Russel Metals said its proposed purchase of seven metal service centers from compatriot Samuel, Son & Co. has been held up because Canada’s competition bureau has concerns “related to a narrow segment of product in a specific geography.”

The companies are engaged constructively with the antitrust watchdog to achieve a resolution and have made a timing commitment to the bureau to allow its investigation to continue and advance discussions, Russel added. But the development means the transaction is unlikely to close this quarter as previously expected.

Russel is acquiring five units in western Canada and two in the U.S. Northeast from Samuel for around CA$225 million (US$163 million, €153 million), subject to closing working capital and other normal course adjustments. Both companies handle carbon and stainless steel, aluminum, copper and copper alloys, as well as a range of fabricated metal products and related services.

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