MOSCOW: Russian aluminium producer Rusal will cut output by more than 6% as part of a production optimisation programme in response to high alumina prices and elevated macroeconomic risk, it said on Monday.

Rusal, the world’s largest aluminium producer outside China, said production would be reduced by 250,000 metric tons per year after disruption to bauxite supplies from Guinea and Brazil and output suspensions in Australia contributed to a surge in alumina prices this year.

Alumina prices have more than doubled since the start of the year to more than $700 a ton.

“As a result, the share of alumina in the cash cost of aluminium increased to over 50% compared to the normal level of 30-35%,” Rusal said, adding that there would be no job losses.

Rusal said it has to purchase more than a third of its alumina abroad at market prices. It also blamed tight monetary policy for sluggish domestic demand for aluminium from construction and automotive industries.

Russia’s key interest rate was raised to 21% in October, its highest since 2003, in an effort to curb inflation.

Copper, aluminium under pressure from weak euro zone PMI

Rusal has also come under pressure as some Western consumers have shunned new deals for Russian metal, even though the Hong Kong-listed company is not directly targeted by Western sanctions over the war in Ukraine.

In April the London Metal Exchange banned Russian aluminium, copper and nickel produced from April 13 to comply with new US and UK sanctions.