LONDON (Reuters) – European customers will avoid deals with Russia’s United Company Rusal, under U.S. sanctions, when the industry meets in Berlin next week to seal 2019 metal supply agreements, three sources familiar with the discussions said.
FILE PHOTO: Aluminium ingots made at the Rusal Krasnoyarsk aluminium smelter taken May 25, 2018. REUTERS/Ilya Naymushin/File Photo
Known in the industry as the “mating season” and taking place alongside a conference run by industry publication Metal Bulletin, negotiations typically agree quantities and premiums paid above the London Metal Exchange benchmark aluminum price.
The aluminum market has so far been sanguine about the fallout from Rusal being placed under sanctions on expectations they would be lifted in October. The sources disagree.
“We can’t agree a deal with Rusal on the basis that sanctions will be lifted by Oct. 23,” a Rusal customer in Europe said. “Anyone that has a relationship with Rusal will be preparing for the sanctions to remain in place for now.”
Rusal declined to comment.
Reporting by Pratima Desai and Polina Devitt; editing by Veronica Brown and Emelia Sithole-Matarise