China and Saudi Arabia halt isocyanate supplies to Russia
Illustrative photo: China and Saudi Arabia have stopped supplying isocyanates to Russia (Getty Images)
Companies from China and Saudi Arabia have stopped supplying isocyanates to Russia. Russia is 100% dependent on the supply, according to Rzeczpospolita.
The Chinese chemical giant Wanhua Chemical Group and the Saudi company Sadara Chemical have halted the supply of isocyanates (MDI) to Russia. This chemical product is widely used in the automotive industry, construction, manufacturing of household appliances, and other sectors. Russia is entirely dependent on MDI imports, and following the European Union's 14th sanctions package, companies from the EU, the US, and Japan also stopped exporting it to Russia.
MDI has a very short shelf life, making long-term supplies via intermediaries from third countries, which help Russia circumvent sanctions, impossible.
In 2014, Russia planned to start its own MDI production, but after 10 years, not a single fully operational plant has been built.
Due to the refusal of China and Saudi Arabia to export MDI to Russia, 20 of the largest representatives of the Russian automotive, construction, and household appliance industries have sent a joint letter to the government requesting urgent measures.
"This decision was a shock to the industry, as given the limited resources of market participants and the short shelf life of MDI, maintaining this situation over the next few months will be associated with the risk of production stoppages and bankruptcy of enterprises," Rzeczpospolita quotes an excerpt from the letter by the heads of Russian companies.
US sanctions against Russia
On August 23, the United States expanded sanctions against Russia, as well as against intermediaries from several countries that helped Russia bypass sanctions and supplied parts for Su aircraft. These countries include the UAE, Hong Kong, Türkiye, Kazakhstan, Kyrgyzstan, and China.
