The turmoil unleashed by U.S. sanctions against United Co. Rusalreverberated in metals markets, sending aluminum and nickel to multi-year highs.
Global metals markets have been rocked for the past two weeks by the clampdown on Russia’s Rusal, which set off a rush for alternative supplies and stirred concern that further U.S. action could affect other markets like nickel.
Aluminum rallied as much as 7.1 percent, a record intraday gain, to $2,718 a ton in London. Since the start of April, prices are up more than 30 percent.
Nickel surged to a three-year high as traders speculated that other major mining companies could face the ire of U.S. officials. Prices climbed 5.4 percent to $16,095 a ton on Thursday.
The U.S. sanctions are upending the global supply chain for aluminum, which is used in planes made by Boeing Co. and Ford Motor Co. trucks. Rusal is the world’s biggest producer outside China, supplying about 6 percent of the world’s aluminum. It operates mines, smelters and refineries across the world from Ireland to Jamaica.
“The aluminum price move is justified,” said Colin Hamilton, managing director of commodities at BMO Capital Markets Ltd. in London. “In nickel, I think it’s a misinterpretation.”
Rusal officials met Chinese companies and traders this week to discuss the possibility of selling output in the Asian country.
Source: Bloomberg Pro Terminal
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