April 11, 2018 / 10:59 AM / 6 months ago

UPDATE 1-CME revokes approved status for Rusal's aluminium

(Adds detail, background)

LONDON, April 11 (Reuters) - CME Group has revoked approved status for Rusal’s metal for delivery against CME aluminium futures contracts after the U.S. Treasury Department imposed sanctions on the Russian company.

The suspension is effective from April 10, a notice on the CME website showed.

The U.S. Treasury last Friday slapped sanctions on seven Russian oligarchs and 12 firms they own or control, saying they were profiting from a Russian state engaged in “malign activities” around the world.

This includes Hong Kong-listed Rusal, which analysts at CRU say accounts for 14 percent of aluminium supplies outside top producer China. Global output this year is estimated at 65 million tonnes.

CME warehouses in the United States hold nearly 54,000 tonnes of aluminium, and most of that is in Owensboro.

The London Metal Exchange also on Tuesday said Rusal’s aluminium would be suspended from its list of approved brands from April 17 after some members raised concerns about settling contracts with sanctions-hit companies.

Rusal’s metal in LME warehouses before April 6 is not affected, but sources say few companies will want to hold it. (Reporting by Pratima Desai in London and Melanie Burton in Melbourne; Editing by Jason Neely and Dale Hudson)

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