U.S. hits Russia with huge aluminum tariff on Ukraine war anniversary
WASHINGTON — The United States will impose a 200% tariff on aluminum and derivatives produced in Russia from March 10, the White House said on Friday, effectively a ban as it announced sanctions on the anniversary of Russia's invasion of Ukraine.
The United States will also apply a 200% tariff on aluminum imports of primary aluminum produced in Russia from April 10.
Russian aluminum is produced by Rusal, which accounts for about 6% of global supplies.
"Alcoa welcomes the imposition of tariffs by the U.S. government on Russian aluminum," the U.S. aluminum producer said. "We continue to advocate for sanctions as the most effective means for the government to take action against Russia and level the playing field for U.S. producers."
Neither Russian metal nor the companies that produce it have been targeted by sanctions imposed on some Russian companies in response to Russia sending troops into Ukraine last year.
In 2018, however, U.S. Treasury Department sanctions on Rusal froze the bulk of the company's exports, paralyzed its supply chain and scared off customers.
The sanctions also fueled a jump in aluminum prices on the London Metal Exchange, which on Friday shrugged of news of the tariffs because Russian metal accounts for only a small proportion of U.S. aluminum imports.
Prices of aluminum, vital for transport, packaging and construction industries, were down 2% at $8,727 a tonne at 1537 GMT. Earlier they touched $2,321.5, the lowest since Jan 9.
U.S. imports of unwrought aluminum and alloys from Russia amounted to 191,809 tonnes, or roughly 4.4% of the more than 4.4 million tonne total last year, compared with 8.9% in 2018 and 14.6% in 2017, according to Trade Data Monitor.
Rusal declined to comment when contacted by Reuters.
Analysts say if Russia decides to retaliate on the 200% tariff on aluminum, it could potentially limit exports of nickel or palladium.
Data Trade Data Monitor (TDM) shows that nearly 11% of the 92,624 tonnes of nickel imported by the United States last year came from Russia and that Russian palladium shipments, at 20 tonnes, accounted for nearly 35% of U.S. imports.
Nickel is vital for the aerospace industry and electric vehicle batteries. Palladium, meanwhile, is a key component for autocatalysts in gasoline-fueled cars.