European companies intend to avoid transactions with Rusal, refusing supplies for next year.
Although the US Ministry of Finance has extended the transition period of sanctions until October 23, while Oleg Deripaska continues to try to negotiate with the White House, no contract with the Russian aluminum company for 2019 is likely to be signed, three sources familiar with the situation told Reuters.
According to them, the market is gradually losing hope that Deripaska will be able to achieve the lifting of the sanctions regime that cut out Rusal from the world market, blocked calculations in dollars, forced production to be cut off at factories across Russia and put the company on the brink of default.
"We can not agree a deal with Rusal solely on the grounds that sanctions can be lifted by October 23," said the consumer of Rusal's products in Europe. "Anyone who has any connections with Rusal will be preparing to the fact that the sanctions so far will remain in force. "
"In a situation of complete uncertainty," Rusal "can not enter into contracts for the next year," another source told Reuters.
Although representatives of "Rusal" will come to Berlin to meet with current and potential customers, the companies "will not want to negotiate with them," said the third representative of the European aluminum buyer.
"We can not risk our supply chain, we have to find alternative sources," he explains.
The United States imposed sanctions in April against seven Russian oligarchs, including former president of RusAl Oleg Deripaska, and twelve companies that they control or own. The share of "Rusal" last year accounted for more than 6% of the world's supply of aluminum, which amounted to approximately 63 million tons.
As a result of the second quarter, "I was able to sell 783,000 tons of primary aluminum and alloys - 22% less than in January-March, and 18% less than a year ago.
Although the average price of aluminum on the London Stock Exchange grew by 18%, the aluminum giant's revenue declined by 9.4% yoy and by 22% compared to the first quarter, the company's IFRS report says.
Although the US Ministry of Finance has extended the transition period of sanctions until October 23, while Oleg Deripaska continues to try to negotiate with the White House, no contract with the Russian aluminum company for 2019 is likely to be signed, three sources familiar with the situation told Reuters.
According to them, the market is gradually losing hope that Deripaska will be able to achieve the lifting of the sanctions regime that cut out Rusal from the world market, blocked calculations in dollars, forced production to be cut off at factories across Russia and put the company on the brink of default.
"We can not agree a deal with Rusal solely on the grounds that sanctions can be lifted by October 23," said the consumer of Rusal's products in Europe. "Anyone who has any connections with Rusal will be preparing to the fact that the sanctions so far will remain in force. "
"In a situation of complete uncertainty," Rusal "can not enter into contracts for the next year," another source told Reuters.
Although representatives of "Rusal" will come to Berlin to meet with current and potential customers, the companies "will not want to negotiate with them," said the third representative of the European aluminum buyer.
"We can not risk our supply chain, we have to find alternative sources," he explains.
The United States imposed sanctions in April against seven Russian oligarchs, including former president of RusAl Oleg Deripaska, and twelve companies that they control or own. The share of "Rusal" last year accounted for more than 6% of the world's supply of aluminum, which amounted to approximately 63 million tons.
As a result of the second quarter, "I was able to sell 783,000 tons of primary aluminum and alloys - 22% less than in January-March, and 18% less than a year ago.
Although the average price of aluminum on the London Stock Exchange grew by 18%, the aluminum giant's revenue declined by 9.4% yoy and by 22% compared to the first quarter, the company's IFRS report says.
Business
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