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UC Rusal seeks to renegotiate alumina contracts

March 11, 2010 - 15:52 GMT Location: London

KEYWORDS: united co rusal , rusal , alumina , josephine mason

United Co Rusal is seeking to renegotiate alumina sales contracts for 2009 and 2010 with smelters and traders, market sources told MB

The Russian aluminium producer has not yet delivered on some contracts from last year and there are concerns about the delivery of some material on contract for this year. The total value of the alumina involved is some $2.5 billion at an alumina price of $340 per tonne.

"The issue is the drop [in alumina output] from 2008 and 2009. Four million tonnes have been lost," a market source familiar with the matter told MB.

"The big issue is Rusal is overcommitted since it stopped its refineries in Jamaica and Eurallumina. They have become short and need to cover their existing commitments which they are reluctant to do," he said.

When asked about the situation, a Rusal spokeswoman told MB: "The information on contracts status is not correct. We would not be able to go into details as this is commercial information which is confidential."

All material subject to strictly enforced copyright laws. © Euromoney Institutional Investor PLC.

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