Amid a backdrop of Western sanctions, and falling prices for one of the world’s most widely-used metals, the Aluminum Association in Russia has issued a grim warning for its industry.

The association has warned in its latest overview of the current state of the sector that the entire industry is at the precipice of a serious crisis, with several enterprises run by Russian aluminum magnate Rusal at risk of shutting down.

On Monday, the association issued its report, which said, “A number of Rusal enterprises are already operating on the verge of zero or even negative profitability,” adding that if economic conditions deteriorate further or there is any further fiscal burden placed upon them, they may need to shut down.

The report went on to warn that there could be as many as 5,000 jobs in the sector which would be at risk, while an additional 30,000 jobs in related industries could also be lost.

The association highlighted that presently aluminum prices had fallen to their lowest levels since March of 2021, and during this period, both the US and the EU markets have been almost entirely closed to Russian suppliers.

The overview noted that political pressure from the United States has forced processors from the European Union to dramatically reduce purchases of Russian aluminum, while in the US, imports of Russian aluminum are hit with import taxes on their entry into the country, tremendously increasing their costs.

On top of all of this, analysts note that Russian aluminum products may be included in the 12th round of sanctions related to the war in Ukraine, which are being discussed by the EU presently.

Experts in the sector also point out that currently Russian producers need to import 60% of raw materials, while profitability in the industry has dropped to 13%. This has led to fears that strategically important investments in the industry will stop, which will negatively affect cities like Siberia, where the local economy is heavily dependent on aluminum production.