Foreign media, October 24 news: Monday, five European companies of industry associations jointly sent a letter to the EU, urging the EU and European governments, not to implement import restrictions such as bans on Russian-made aluminum products, warning that that could lead to the closure of thousands of European companies.
The letter was revealed in a joint statement issued by the Federation of European Aluminum Consumers (FACE), the German Federal Association for Economic Development and Foreign Trade (BWA), the Italian Association of Foundry Equipment Manufacturers and Suppliers (Amafond), the Italian Association of Steel Distributors (Assofermet), and the Italian Foundry Association (Assofond).
The statement asks the European Commission and EU member states to intervene urgently in relation to the Russian aluminum-related ban and the threat of high tariffs or sanctions against it, as they would pose a direct and serious threat to the European aluminum industry.
The statement argues that those calling for a boycott or action against Russian metals “are either their (Russia’s) main competitors or have supply options that are not available to the vast majority of members of the European aluminum value chain.”
The statement noted that for small European companies that consume aluminum, a crackdown on the Russian aluminum industry “could have the immediate consequence of closing thousands of European companies and adding tens of thousands of unemployed people”.
The threat mentioned in the statement is obviously the recent news of the ban on Russian metals, especially Russian aluminum. Wall Street Insight has introduced Russia as the world’s second largest aluminum producer, with aluminum production accounting for about 6% of total global production, Russian aluminum traditionally accounts for about 10% of U.S. aluminum imports, and until August, Russia was the third largest aluminum exporter to the United States; Rusal is also Europe’s largest supplier of electrolytic aluminum, supplying 40% to Europe.
Since the outbreak of the Russia-Ukraine conflict, the West has imposed sanctions on Russian banks and many other industries. The West has so far refrained from taking on Russian metals for fear of disrupting the global supply chain. However, as the conflict escalates, there are few Russian products left for the West to sanction.
In late September, the London Metal Exchange (LME), the world’s largest industrial metals exchange, confirmed the release of a “market-wide consultation document” seeking members’ views on how to handle Russian supplies, opening the door to a possible ban on deliveries of new Russian metals from LME warehouses around the world. The door was left open for a possible ban on new deliveries of Russian metal from LME warehouses worldwide. At the time, the media noted that the LME’s Aluminum Committee was “broadly supportive” of the move.
Almost two weeks ago, on October 12, the media broke the news that the United States was considering sanctions against Russian aluminum, mentioning three options: an outright ban on Russian aluminum, raising tariffs to punitive levels, and sanctioning Rusal, the Russian Aluminum Combine.
This Monday’s business association statement is still another microcosm of European companies struggling under the pressure of the energy crisis.
On the day of the statement, the latest survey released by the German Iver Institute for Economic Research showed that 25% of German family businesses are considering layoffs due to high costs, accounting for a significant climb from 14% in the previous survey in April.
The survey also showed that 57 percent of German companies surveyed are postponing investment behavior. 9 percent plan to move abroad, compared with 6 percent in the April survey six months ago.
According to Kirchdorfer, president of the German Family Business Foundation, the findings are a red flag that industrial value creation in Germany has been shifting, “a deadly development that is accelerating as companies are reducing production within Germany and shifting production to places with lower energy costs and taxes.”
The CCTV report mentions that energy costs for German family-owned companies have risen sharply over the past year. Last year energy costs accounted for about 5 percent of total sales, rising to 8.2 percent this year.
Due to soaring energy costs, European aluminum production has slumped to its lowest level since the 1970s. On Monday, the media mentioned that due to high energy prices, since last year, European companies shut down factories resulting in a reduction in combined aluminum production capacity of more than 1 million tons.
Post time: Oct-25-2022