DW: This is Putin’s main geopolitical weapon, not oil and gas – Kremlin leader threatens to ban uranium and titanium exports – Labor

The West no longer imports Russian resources? Well, not really. It includes those that it cannot find elsewhere, such as uranium and titanium

Deutsche Welle (DW) reports that Russian President Vladimir Putin is threatening to ban exports, which will hit both the West and Russia hard.

“The delivery of several goods to us is limited, so we may also think about some restrictions, say on uranium, titanium and nickel,” Putin said last month.

He ordered the Russian government to review possible export restrictions.

Already in 2022, the Kremlin tried to pressure Europe with gas supplies. The goal was to weaken Western support for Ukraine, which is defending itself against Russian aggression.

The new risks are not in vain, since the US and Europe are heavily importing the raw materials mentioned from Russia.

What is the role of Russian uranium?

It is no coincidence that Putin mentioned uranium first. The state concern “Rosatom” has a share of 40 percent in the world market in the trade of enriched uranium. No one offers such a good product for new generation reactors.

The American company “Sentrus Energy” began enriching uranium only at the end of last year, but the numbers will remain small for a long time. The company’s main business is the supply of uranium, which it receives from Rosatom.

In the total amount of uranium delivered to the USA, “Rosatom” participates with more than 20 percent, and in Europe this share is 30 percent.

Rosatom’s export business to the US is two billion dollars a year. This is about half of the total exports of the Russian concern. The export business to the European Union amounts to approximately 500 million dollars.

In addition, Rosatom produces ready-made fuel for reactors of Soviet and Russian production and offers related services.

According to its own data, the concern had a turnover of more than four billion dollars last year in Western countries. In the world, the total turnover is worth 16.4 billion US dollars.

How can sanctions be avoided?

It would be difficult for both parties to end the business relationship. That is why until recently Rosatom was one of the few Russian companies not under sanctions.

At the same time, it is clear to the West that it must reduce its dependence on imports from Russia. Only Hungarian Prime Minister Viktor Orbán sees it differently.

In addition to Rosatom, a lot of uranium is enriched by two European companies – Urenko and Orano Uran. Both are expanding their ability to increase exports to the US.

Dmitry Gorchakov, an atomic energy expert at the Bellona Foundation, says that if successful, the US could stop importing from Russia in five years, while Europe would need a little longer. .

Recently, American companies have been importing more and more uranium from China. This appears to be a resale of Russian uranium, as Russian supplies to China have increased significantly since 2022.

It shows that despite the sanctions, Russian raw materials can find their way to the American market.

What about titanium?

Almost all the use of titanium in Russia is controlled by the company “VSMPO-Avisma”, which is based in the Ural city of Verkhnaya Salda. Its share in the production of titanium sponge in the world is 15 percent.

And more than half of the total amount of titanium sponge available in the world is produced in China. A little less than a quarter is produced in Japan. Kazakhstan accounts for ten percent.

“VSMPO-Avisma” is under American sanctions, but not under European Union sanctions. Before the war, the main customers were the American concern “Boeing”, as well as the European aircraft manufacturer “Airbus”.

The Americans announced the end of cooperation immediately after the beginning of the Russian attack on Ukraine, and the Europeans in December of the same year.

Before that, the head of Airbus, Guillaume Fourie, spoke against the sanctions, because according to him, these would be sanctions that the Europeans would impose on themselves. The complex manufacturing processes and networks of supplier dependencies in the industry do not leave the ability to change suppliers overnight.

Both the Americans and the Canadians have prepared for exceptions in their sanctions against the Russian company VSMPO-Avisma. Companies such as the aircraft manufacturers Bombardier and Airbus benefit from this, as well as several suppliers for Boeing, such as the French Safran or the British Rolls-Royce.

They all continue to mine titanium in Russia. VSMPO-Avisma’s exports to Europe last year amounted to 345 million dollars, and the year before it was 370 million dollars.

Metals expert Andy Hom says the US is less dependent on Russia for titanium because it is developing capacity faster, but the EU is increasingly looking to the US in this area. And that goes against the European Union’s law on critical raw materials, which was approved this year. At the moment, the EU has no choice.

Who Needs Russian Nickel?

One of the largest nickel producers in the world is the Russian company Norilsk Nickel. It has long been out of sanctions, but the US and the UK banned it a month ago, while the European Union has not yet done so.

However, the war changed the export structure. Before the war, more than half of this company’s exports were to Europe, and 16 percent to America. 27% of production goes to Asia.

Last year, exports to Europe decreased to 24 percent, and exports to North and South America – to ten percent. Asia’s share rises to 54 percent.

This redirection of exports from west to east is not the only challenge for the Russian company. There have been fluctuations in the price, but today it is lower than it was before the Russian invasion of Ukraine.

The reason is the unexpected appearance of the Indonesian nickel market, which has much larger reserves of this metal than Russia.

Andy Hom, who also writes for Reuters, says that it is not certain what happened to the Russian company in this area because of this.

Putin has warned his government not to do anything that would harm Russian companies as they review possible restrictions on the export of Russian raw materials.

As for nickel, at least Russia will not be able to use this raw material as a geopolitical weapon.