EU Slaps Sanctions On Russian Steel Magnates

Continuing our coverage of the Russian invasion of Ukraine and its impact on steel prices, aluminum prices and more, the European Union has brought sanctions against two Russian metals magnates on Feb. 28.

The move comes on the heels of Russia’s invasion last week of Ukraine.

EU sanctions Russian steel magnates

Alisher Usmanov, a majority shareholder in steelmaking and mining group Metalloinvest via his USM holdings vehicle, as well as Severstal chairman Alexei Mordashov, will both face travel restrictions and have their assets frozen in the 27-member bloc, news reports stated.

Metalloinvest has two steelmaking assets, the Oskol Electrometallurgical Plant (OEMK) and Ural Steel.

USM holdings also owns the Udokan Copper mine, which is under development in eastern Russia’s Zabaykalsky krai. Estimated copper reserves are 26.7 million metric tons, based on JORC classifications.

Mordashov owns 77% of Severstal and was CEO up until 2015. The main plant is Cherepovets, approximately 500 kilometers north of capital city Moscow. The plant can produce 10.5 million metric tons per year of crude steel via BF/BOF and the electric arc furnace routes. It then casts and rolls into longs and flats products.

It was not immediately clear how or if the sanctions would impact operations or exports from the steelmakers.

Russian steel exports depart from the Black Sea ports of Novorossiysk and Tuapse. However, there are unconfirmed reports that ships do not wish to call at those ports.

The sanctions follow moves by the United States, the E.U. and their allies over the weekend to disconnect some Russian banks from the SWIFT network. The network allows for fast cross-border payments.

The Russian Central Bank’s assets are also now frozen to prevent it from accessing its overseas assets.

Fighting continues

Meanwhile, in Ukraine, fierce fighting raged between Russian and Ukrainian forces in Kharkiv, following the Feb. 24 start of an invasion, which has received near global condemnation. There were also reports of fighting in around the port city of Mariupol, and attacks on capital city Kyiv, MetalMiner heard.

President Vladimir Putin on Feb. 27 ordered Russia’s military to put its nuclear deterrent forces on special alert in response to “aggressive statements” by the West, the BBC reported.

By AG Metal Miner

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