Rusal would choke on aluminum

The export-oriented company has lost the opportunity to supply its metal to the foreign market. Oleg Deripaska asks the government to begin buying aluminum in state reserves.
Origin source
Billionaire Oleg Deripaska appealed to the government asking him to start buying out stocks of aluminum, which he got under the sanction of Rusal, which he can not sell while being cut off from the world's largest trading floors.

The state, according to Deripaska, could buy back from the company products for the state reserve, informed the "Interfax" informed source, adding that "the government thinks."

According to him, this is not the only support measure that a businessman, who was rich in times of bloody chaos in the aluminum industry of the 1990s, asked.

Deripaska asks for a loan through Promsvyazbank for RusAl and GAZ Group, which, due to the sanctions, is likely to have to stop the conveyor this summer, a source in the government told Tass.

Judging by the statistics, "Rusal" is drowning in aluminum reserves, which it can not sell, analysts of Raiffeisenbank note. So, according to Rosstat, in April in the Russian Federation aluminum production jumped by 31%. However, international statistics do not confirm this: according to IAI, volumes in Central and Eastern Europe fell by 3%, analysts of Raiffeisenbank note.

The physical volumes of aluminum production can not be technically increased on such a scale in one month, says Kirill Tremasov, director of the analytical department of Loko-Invest.

"Most likely, this is the primary aluminum that was not in demand for the production of alloys: many customers, under which specific alloys were made, could refuse to purchase because of sanctions," he explains.

In other words, Rusal continues to produce primary aluminum, but can not ship the final product.

For the state, such assistance will cost about $ 1 billion a year, says chief of operations at the stock market "Freedom Finance" George Vashchenko. Deripaska already asked to buy aluminum in the state reserve 4 years ago, when the price of metal was lower than the production cost, he recalls.

In May, Rusal appealed to the London Metal Exchange to resume trading in the company's products, but was refused, despite the fact that the US Treasury extended the deadline for closing deals with Rusal until October 23.