Europe’s largest aluminum manufacturer, Norsk Hydro, pushes for a Russian aluminum boycott, attributing its exports to funding the conflict against Ukraine. The CEO of Norsk Hydro, Hilde Merete Aasheim, opines that European producers could thrive with low-CO2 production techniques in a VDI interview.
Global Reach, Local Challenges
Originating from Norway, Norsk Hydro commands the aluminum market across continents, from Germany and the Middle East to Brazil. Since 2019, Aasheim has helmed the corporate giant.
War & Business
Aasheim shared insights about the ramifications of the Ukraine conflict on the aluminum industry:
“Norsk Hydro has unequivocally denounced the Ukraine conflict from the outset, instituting sanctions in our capacity. The war has significantly amplified the vulnerabilities of the global supply chain. Energies, minerals, and strategic raw materials face mounting challenges due to these upheavals. The Ukraine conflict curtails broader economic growth, thus dampening the demand for our commodities. The impact varies across countries where we have a presence, and supply snags are particularly palpable during winter.”
Russian Aluminum & Sanctions
To date, neither the EU nor the London Metal Exchange (LME) has sanctioned Russian aluminum. When queried on anticipated import prohibitions, Aasheim remarked:
“Hydro ardently supports sanctions on Russian aluminum. This past July, we approached the LME to reassess their decision from November 2022, wherein they opted not to sanction Russian aluminum.”
On being probed about the necessity for such sanctions, Aasheim elaborated:
“Before the war erupted, Russian aluminum constituted 17.7% of the LME’s aggregate inventory. With the onset of the Russian offensive, this proportion predictably dipped to about 10%. Astonishingly, it escalated to 41% at the year’s commencement, and recently soared to a staggering 81%. The EU’s reluctance to enlist Russian aluminum in the raw material sanctions, unlike other nations, implies that these exports are inadvertently bankrolling the war against Ukraine. This scenario plays out while half of the EU’s capacity remains dormant, predominantly due to surging energy costs.”
Profit from the Conflict?
Regarding speculations of Norsk Hydro potentially capitalizing on the war, Aasheim clarified:
“Our primary clientele hail from the construction, automotive, and engineering sectors. Hydro doesn’t manufacture alloys suited for weaponry. Only an inconsequential fraction of our metal might cater to defense technology. In light of sanctions targeting specific entities and nations, we’ve instituted stringent checks for this limited clientele.”
Aasheim’s revelations underscore the intricate interplay of geopolitics, business, and ethics in the aluminum industry.