World’s top alumina supplier Australia bans exports to Russia

Australia, the world’s biggest exporter of alumina, announced a ban on shipments to Russia in a move that will add further pressure on aluminum giant United Co. Rusal International PJSC.

Australia accounts for nearly 20% of Russia’s supply of alumina, the government said on Sunday. Alumina is the key ingredient for producing aluminum, and it is in turn produced from bauxite ore. Exports to Russia of alumina and aluminum ores, including bauxite, have been banned immediately.

“There was a ship that was due to dock in Australia this week to collect a load of alumina bound for Russia,” Prime Minister Scott Morrison told reporters. “That boat is not going to Russia with our alumina.”

While aluminum has not been targeted by sanctions, Rusal—which needs bauxite and alumina to feed its plants—is facing disruption to its supply chains as companies pull back from doing business with Russia. Rio Tinto Group planned to stop supplying bauxite to, and buying alumina from, a Rusal plant in Ireland, people familiar with the matter said earlier this month. 

In Australia, Rio operates the Queensland Alumina Ltd. joint venture with Rusal, which holds a 20% stake. The London-based company has said previously it was evaluating its options regarding the partnership with Rusal and had the “appropriate structures” in place to ensure Queensland Alumina’s operations would not be disrupted.