Rusal’s 2023 Profit Slumps on Subdued Prices, Lower Production

SEATTLE (Scrap Monster):  Russia’s Rusal reported an 84.3% slump in its annual profit on Friday, as weak realized prices for aluminum and lower production due to international sanctions weighed on the aluminum giant’s earnings.

The company said the average realized price for its aluminum, used in transportation, construction and packaging, was $2,439 a ton in 2023, down 18% from the prior year.

Rusal, the world’s largest aluminum producer outside China, saw a surge in production costs in 2022, as its business took a hit after Russia’s invasion of Ukraine in February that year.

While there are no Western sanctions on Rusal or Russian aluminum, some Western consumers are shunning new deals for Russia-made metals.

Sales of primary aluminum, however, rose 6.6% to 4.2 million metric tons in the year ended Dec. 31, while production was largely unchanged at 3.8 million tons.

However, production of alumina, a key raw material, fell 13.8% due to a production curtailment at the Nikolaev Alumina Refinery caused by the introduction of martial law in the territory of Ukraine, the company said.

“The sanctions imposed by the Australian government resulted in failure to supply alumina from Queensland Alumina Ltd to the Group’s operations,” it added.

Rusal operates in Guinea, Jamaica, Ireland and Sweden apart from Russia.

The company posted a net profit of $282 million, down from $1.79 billion a year earlier.

Rusal’s revenue fell by 12.6% to $12.21 billion.

Courtesy: www.mining.com