The EU plans to ban Russian aluminium imports as part of sanctions over Russia’s invasion of Ukraine.

EU plans to ban Russian aluminium imports

The European Union is reportedly proposing a phased ban on imports of Russian aluminium to the bloc. The proposal calls for an import quota for a year before the complete ban comes into effect. Although the EU continues to import Russian aluminium, volumes have fallen over the past two years, with European buyers self-sanctioning since the invasion of Ukraine.

The EU imported more than 320,000 tonnes of unwrought aluminium from Russia in the first 11 months of 2024, accounting for around 6% of total imports, according to UN Comtrade data, a relatively small fraction of the global aluminium market. Meanwhile, Russia has steadily increased sales to Asian consumers, particularly China, over the last three years. If enacted, EU sanctions are likely to spur London Metal Exchange (LME) prices. However, it is not a given that the EU will agree to the package, as the proposal will require backing from all member states and may still change before being formally proposed to members, according to reports.

The EU was compelled to take action by the USA

Tariff threats continue to keep the metals markets on edge. Copper dropped below $8,000 per tonne in yesterday’s trading session after US President Donald Trump’s latest in a series of tariff threats. Trump said on Monday that he plans to impose tariffs on copper, aluminium, steel, as well as computer chips and pharmaceuticals, to boost domestic production.

He also stated that he wants to impose across-the-board tariffs that are “much bigger” than 2.5%, contradicting reports that incoming Treasury Secretary Scott Bessent favoured starting with a global rate of 2.5%.

Metals markets are turning increasingly nervous about the prospect of tariffs. According to the US Geological Survey (USGS), the US has a net import reliance of 13%, 44% and 46% for iron & steel, aluminium and copper, respectively. A prolonged trade conflict would slow global growth and hurt demand. Tariffs remain a major headwind to metals, whether in force yet or not.

The latest LME Commitment of Traders (COTR) report shows that speculators increased their net long position in aluminium by 5,269 lots for a second consecutive week to 117,876 lots for the week ending 24 January, the highest since the week ending on 15 November 2024. Similarly, net bullish bets for copper rose by 3,507 lots for a fourth consecutive week to 67,624 lots (the highest since the week ending 8 November 2024) at the end of last week. In contrast, money managers decreased net bullish bets for zinc by 651 lots to 28,853 lots as of last Friday.