Aluminum stocks weakened today despite Russian leader President Vladimir Putin declaring that he was ready to work with U.S. firms on new mining projects in the depths of Siberia.
In pre-market trading Rio Tinto (RIO) softened 1%, Alcoa (AA) was down 0.6% and Century Aluminum (CENX) slipped 0.75% even though Putin, fired up after a phone call with President Trump on economic development, outlined the opportunity for joint aluminum development.
Putin Wants Joint Mining Projects
Putin, for the last three years since the invasion of Ukraine heavily sanctioned and seen as a pariah by Western governments, said that Russia and the U.S. could work jointly on aluminum production in Russia’s Krasnoyarsk region in Siberia. It is the home base of Russian aluminum giant Rusal. “What is most important, in my opinion, is that we could consider working together with American companies in this area,” Putin said. He estimated potential investment in this project at $15 billion.
The Russian leader also said that Russian firms could supply up to 2 million tons of aluminum to the U.S. market every year. Before the Ukraine invasion Russia supplied up to 15% of aluminum imports.
Hydropower and Rare Earth Also in Mix
Putin also floated the possibility of U.S firms teaming up with Russia on hydropower generation, energy and jointly exploring rare earth metals deposits. He hinted that some Russian and U.S. firms were already in touch with each other, despite the continuation of bombing and fighting in Ukraine. He did not provide any further details.
According to U.S. Geological Survey data, Russia has the world’s fifth-largest reserves of rare earth metals with estimated reserves of 3.8 million metric tons. These wonderfully named metals, such as Cerium and Praseodymium have a variety of end-uses such as electric vehicles, missile systems, electronics and MRI scanners.
Is RIO a Good Stock to Buy Now?
On TipRanks, RIO has a Strong Buy consensus based on 4 Buy and 1 Hold rating. Its highest price target is $98.46. RIO stock’s consensus price target is $81.62 implying an 30.09% upside.
