Sanctions against Russia must also cover imports of metals

Michael Reckordt is a commodity policy officer at the NGO PowerShift.

The debate on sanctions against fossil energy imports has revealed how great the dependence of the EU and Germany on Russia was, and in some cases still is. Wrong political decisions (Nord Stream 2), the wrong framework (slowing down the expansion of renewable energies) and economic interests are currently resulting in price increases and supply uncertainties.

The debate is almost exclusively about the energy raw materials gas, oil, and coal. The fact that Germany also imported metallic raw materials worth almost €2 billion from Russia in 2020 has so far been ignored. In the case of important industrial metals such as palladium, refined copper, iron ore, and aluminum, Germany obtains around 20 percent from Russia. For nickel, the dependency is even higher at 44 percent.

Something has to change about this because the mining of raw materials in Russia is heavily influenced by oligarchs. Important players are, for example, Roman Abramovich, who invested in the aluminum industry, Oleg Deripaska, who holds shares in various energy and raw materials companies, including the second largest aluminum company Rusal, and Vladimir Potanin, head of the Russian mining company Nornickel and dubbed the “nickel king” by the British newspaper “The Guardian”.

Because all three are said to be close to Putin, they are on the British sanctions list. While Great Britain was still cracking down on the metal oligarchs under Boris Johnson, there are no comparable sanctions on the European side. There are not even any debates about them.

Dependence makes sanctions almost impossible

The reason is clear: For a decade and a half, Germany has relied on cheap imports instead of recycling raw materials. The dependence on Russian imports is so high that sanctions are hardly possible. In the context of a turning point, the raw materials policy of the last 15 years has failed.

Both the European raw materials initiative in 2008 and the German government’s raw materials strategies in 2010 and 2020 focused one-sidedly on the security of supply of metals to industry. Dependencies on Russia and China have hardly decreased during this period. And the strategies overlooked an important adjusting screw: reducing dependence by reducing the consumption of primary raw materials.

There are two main reasons for this: For a long time, the industry profited from widely ramified supply chains and a lack of standards in mining. This led to environmental destruction and human rights violations but kept prices low. The second reason is also dramatic: We import large quantities of metals but pay little attention to keeping them in use as long as possible and processing them for recycling. For years, the recycling values for bulk metals such as copper, iron, or aluminum have been stagnating, while demand has been rising sharply. One driver for this is cars that are getting bigger and heavier.

Many tons of raw materials wasted

The EU and the German government have also neglected to create stronger incentives and political framework conditions for recycling over the past 15 years. In the last revision of the German raw materials strategy, only two of 17 measures focused on circular economy. One of these was an industry dialogue, the other a mandate to initiate research projects. In 15 years, many tons of metallic raw materials have thus been wasted. They are no longer recoverable and are considered dissipated and lost. So we have to import new primary raw materials, from Russia and China, among others.

The Russian war of aggression has ruthlessly exposed this dependency. As PowerShift, we demand an import stop of metallic raw materials from Russia in view of the war and Putin’s power system. At the same time, the European Commission and the German government must revise their raw material strategies and significantly reduce imports of primary metals. This requires measurable reduction targets for individual sectors.

Human rights, ecological and climate policy necessities do not permit any further expansion of metallic mining. In the future, we will not be able to do without primary raw materials. But we must stop wasting them by keeping metals in use and then in the cycle for much longer . The expansion of the circular economy must be given top priority in raw materials policy. This is the only way to have a sustainable policy in a time of geopolitical crises and climate catastrophe.

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