Reports indicate that the EU is preparing to propose a gradual ban on the import of aluminum metal from Russia. The news of the proposed ban has raised concerns about market tightening, seemingly bolstering aluminum prices. As of 3:15 PM local time, aluminum prices on the London Metal Exchange rose by 2% to $2,624.50 per ton, while the performance of other metals varied. Copper was up 0.6%, reaching $9,039 per ton, and lead rose by 1.7%.
This plan has circulated among member states as part of a broader sanctions scheme, allowing European buyers to import 275,000 metric tons of Russian aluminum under a quota system for one year, after which a full ban will be implemented.
Since the outbreak of the Russia-Ukraine conflict in February 2022, the EU has been calling for a ban on the import of Russian aluminum, leading to a steady decline in Russian aluminum supply to the EU as manufacturers start seeking alternative suppliers. However, even now, some buyers and member countries still resist this measure, arguing that certain key products are difficult to replace completely.
According to UN trade data, the EU imported about 320,000 tons of unwrought aluminum from Russia in the first 11 months of 2024, accounting for 6% of total imports. Meanwhile, Russian aluminum exports to China have significantly increased.
Metal traders are still watching for the potential impacts of the U.S.-led trade war. White House spokesperson Caroline Levitt reiterated on Tuesday that tariffs on China, Canada, and Mexico will take effect on February 1. Additionally, former President Donald Trump stated that the comprehensive tariffs he wants to implement are “far higher” than 2.5%.
ING has stated that the EU ban could drive aluminum prices higher, adding that the proposal requires support from all member countries and may change before a formal proposal is made.
According to the U.S. Geological Survey, the U.S. has a net import reliance of 13% for steel, but for aluminum and copper, the net import reliance is 44% and 46%, respectively.
ING also noted that prolonged trade conflicts will slow global growth and harm demand for industrial metals, and added that tariffs pose significant obstacles to the metal market, regardless of whether they take effect.
