Deripaska’s company Rusal asks Kremlin to provide concessions for transport tariffs as US sanctions take effect

Russian billionaire Oleg Deripaska’s company, UC Rusal, requested through Prime Minister Dmitry Medvedev to reduce costs for transportation of raw materials and finished products by rail, the Kommersant newspaper reports.  

According to the sources cited in the newspaper, Rusal asked to reduce tariffs of the Russian Railways company for transportation of raw materials and products, which was estimated by the company to be worth around 24 billion rubles (380 million dollars) from July 1.

Tariffs for the transportation of alumina are levied an additional rate of 1.64—Rusal asked to reduce this figure to 0.895. The company also requested the cancellation of the 8% markup for tariffs of export transportation of aluminum alloys, wire rod and rolled products. Rusal and JSC Russian Railways refused to comment on the situation.

The newspaper’s source noted that the main proportion of the costs in aluminum production are spent on electricity and raw materials. Costs for transportation are about $70 per ton, or 3% of the total expenditure.  

Deripaska and his companies, UC Rusal and En+Group, were included in the sanction list of the U.S.’s Treasury Department on April 6. Prime Minister Medvedev asked the Russian government to develop measures to support Deripaska’s companies and the other enterprises subjected to restrictions. Minister of Finance Anton Siluanov stated that the government can help UC Rusal through the State-controlled banks.

  Rusal, Sanctions on Russia, Deripaska