Russia May Restrict Exports Of Key Metals Such As Nickel And Palladium To Threaten US Supply.
Apr 23, 2023
Analysts say that if the United States imposes high taxes on aluminum imports from Russia, Russia may restrict exports of key metals such as nickel and palladium, thereby threatening US supply.
Russia's aluminum only accounts for a small portion of the United States' supply, but nickel is crucial for the aerospace industry and electric vehicle batteries, while palladium is a key component of automatic catalytic converters in gasoline fueled vehicles.
According to Trade Data Monitoring Corporation (TDM), nearly 11% of the 92624 tons of nickel imported from the United States last year came from Russia; The United States also imports 20 tons of palladium from Russia, accounting for nearly 35% of the total imports.
Recently, there have been reports that the United States is considering increasing the import tax on aluminum originating from Russia to 200%.
Aluminum produced by Russian aluminum companies accounts for approximately 6% of global supply.
Liberum analyst Tom? Price said that if the United States imposes high tariffs, the market should expect Russia to respond, possibly by imposing restrictions on other key metals exported to the United States. An analyst at a fund focused on commodities also believes that Russia is likely to retaliate by banning the shipment of nickel and palladium to the United States.
TDM data shows that last year, the United States imported 191809 tons of unwrought aluminum and alloys from Russia, accounting for approximately 4.4% of last year's total imports of over 4.4 million tons. This accounted for 8.9% in 2018 and 14.6% in 2017.
Analysts at Macquarie Bank say that for the United States, tariffs should not have a significant impact on the market, as imports from Russia have decreased. However, if sanctions are implemented, there may be spillover effects.
Since the outbreak of the Russia-Ukraine conflict last year, Russian metals and metal production companies have not been the targets of Western sanctions. In 2018, the US Treasury imposed sanctions on Russian aluminum, freezing most of its exports, paralyzing its supply chain, and leading to a surge in international aluminum prices.
