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Alcoa (NYSE:AA) +5.9% and Century Aluminum (CENX) +4.8% post-market Friday after the U.S. and U.K. announced new restrictions on trading in Russian aluminum, copper and nickel in an effort to hurt Vladimir Putin’s ability to fund his war machine.
The rules prohibit the London Metal Exchange and the Chicago Mercantile Exchange from accepting new supplies of aluminum, copper and nickel produced by Russia, and the U.S. is banning Russian imports of all three metals.
The U.S. and U.K. will exempt existing stocks of Russian metal on the LME and Comex so the metals can still be traded and withdrawn in an effort to minimize the risk to market stability.
While western sanctions have targeted Russian oil, gold and numerous officials and companies, Russia’s largest industrial metals groups had been able to continue to sell their products unaffected by any broad restrictions.
Russia is a major producer of the three metals, accounting for ~6% of global nickel production, 5% of aluminum and 4% of copper, but Russian metal accounted for 36% of the nickel in LME warehouses, 62% of the copper and 91% of the aluminum, according to the most recent monthly data.