The US Department of the Treasury, in coordination with the United Kingdom, issued two new prohibitions to disrupt the revenue that Russia earns from its export of aluminum, copper, and nickel. This new action prohibits the import of Russian-origin aluminum, copper, and nickel into the United States, and limits the use of Russian-origin aluminum, copper, and nickel on global metal exchanges and in over-the-counter derivatives trading.

To implement this policy, Treasury has issued a new determination under E.O. 14068 prohibiting the importation into the United States of aluminum, copper, and nickel of Russian Federation origin produced on or after 13 April 2024.

Treasury also issued a complementary determination under Executive Order (E.O.) 14071 that prohibits the exportation, reexportation, sale, or supply to any person located in the Russian Federation of (1) warranting services for the metals produced on or after 13 April 2024 on a global metal exchange and (2) services to acquire the metals produced on or after 13 April 2024 as part of the physical settlement of a derivative contract.

As a result of the collective actions, metal exchanges, such as the London Metal Exchange (LME) and Chicago Mercantile Exchange (CME), will be prohibited from accepting new aluminum, copper, and nickel produced by Russia. Metal exchanges facilitate the trading of industrial metals around the globe.

Russia is a major producer of the three metals.

• Russia, home to nickel giant PJSC MMC Norilsk Nickel, produced 195,000 tonnes of mined nickel in 2021, or 7.2% of global supply, according to data from S&P Global Commodity Insights’ Metals and Mining Research team. It produced 121,000 tonnes of primary nickel, or 4.6% of global production.

• Russia-based Rusal is one of the largest aluminum producers across the world and plays a vital role in global supplies. The US in 2018 put sanctions on Rusal’s operations, which led to severe supply tightness and pushed up global aluminum prices to a seven-year high, eventually leading to significant rise in production costs for downstream manufacturers, according to S&P Global Commodity Insights. Rusal’s aluminum production totaled 3.76 million mt in 2021.

• Russia accounts for 3% of global copper production. In 2022, Russia’s copper exports declined by 32.12% compared to 2021, with the highest share being exported to China.