Where did the banned nickel go? Russian nickel after the 2024 LME/US-UK ban

Trade-flow companion to the price wedge (R72), the nickel twin of the Russian-aluminium case. Both come off the same 12–13 Apr 2024 Western metals-ban package, which named aluminium, copper and nickel in one instrument. The aluminium case showed the diversion shape: a Western origin-ban that does not capture the metal but re-routes it into China, the one large buyer still taking it, after which the units re-enter the global pool embedded in Chinese-origin product. Russian nickel is the same shape with a subtler magnitude and a sharper relocation twist. This is a DUAL-SCORE / alternative-track signal — never folded into any Tier-1 exposure score. The divergence between "the West stopped buying Russian nickel" and "the underlying Nornickel units simply changed buyer, and the producer is now building the capacity to re-flag them as Chinese" IS the signal. Research, not investment advice; the re-entry leg is INFERRED from fungibility and reported relocation plans, not asserted on any single shipment.

Live chart + method: [/situation-room → "Is the ban leaking?"](/situation-room).

Verdict

The West banned Russian nickel in the same stroke as aluminium and copper:

• 12 Apr 2024 (US + UK). OFAC issued a determination under E.O. 14068

prohibiting US import of aluminium, copper and nickel of Russian origin produced on or after 13 Apr 2024, and a complementary E.O. 14071 determination barring the LME and CME from warranting or physically settling new Russian metal of those three types. The UK acted in parallel. (US Treasury press release JY2249.)

• No EU import ban on Russian nickel as of this pull — nickel was explicitly

carved out of the EU's 16th-package metals measures (which hit primary aluminium). And Nornickel itself carries no OFAC SDN listing — the action bites the exchange-deliverable warrant and the US customs line, not the company.

The metal did not disappear. UN Comtrade (reporter China, HS 750210 unwrought unalloyed nickel, imports) shows the diversion — but read it carefully, because the nickel fingerprint is not a dramatic surge like aluminium's:

Source: UN Comtrade, reporter China (156), HS 750210, flow = imports, annual, pulled via the free public preview API (2026-07-24). Committed artifact `data/intelligence/nickel-russia-circumvention.json`. Class-1/refined-share and relocation context: USGS MCS 2026 + Nornickel filings + Reuters/Interfax (below).

Full series (Russia → China, HS 750210, gross weight, with Russia share of China's world total): 2019 88,301 t (45.7%) · 2020 51,757 t (39.6%) · 2021 46,088 t (17.8%) · 2022 45,098 t (29.0%) · 2023 38,026 t (41.8%) · 2024 46,290 t (47.6%). Corroboration on the ban-year step-up: China's Q1-2024 Russian unwrought-nickel intake was ~6,282 t vs ~4,426 t in Q1-2023, +42% (Reuters / MMTA reporting off China customs).

Read honestly, the nickel signal is not the aluminium 4.6× surge — Russia's absolute tonnage into China in 2024 is still below its 2019 level, because Russian nickel was always heavily China- and Europe-facing. The signal is two quieter facts:

1. Share dominance in the ban year. Russia became 47.6% of China's entire unwrought-nickel import bill in 2024 — a six-year high — and its share rose while the world total shrank (China now refines more domestically and imports intermediates/ore rather than finished metal). As the West de-risked, Russia consolidated as China's single largest supplier of finished nickel. 2. Volume recovery against a falling market. The Russia line rose +21.7% in the ban year (38.0 → 46.3 kt) even as its value fell −9.9% — because the nickel price crashed on Indonesian oversupply. That price collapse is exactly why the LME ban had "limited impact": the market is structurally oversupplied to ~2027, so this control drains revenue, not physical availability.

Why this is the diversion shape, not the antimony trans-shipment shape: China is the world's largest nickel refiner and a legitimate buyer of Russian metal — a Russia→China flow is not physically implausible the way a Thailand antimony surge is. The implausibility is in the claim the ban rests on. A Western risk team reading "we no longer touch Russian nickel" has severed a label, not a dependency: Nornickel is one of the world's largest Class-1 (LME-deliverable) / battery-grade refined-nickel producers (~5–6% of all-nickel mine output but a materially larger slice of the high-purity pool the West's specialty and battery buyers actually need), and those units now sit inside the Chinese refined-nickel and battery-precursor pool the West buys from.

The corporate pipe (the ownership tell points into China — mode B)

The antimony case had a namesake shell routing metal back to the buyer (Youngsun → Thai Unipet → Youngsun & Essen). Russian nickel, like Russian aluminium, runs the other direction — but it goes a step further than Rusal's equity stake: Nornickel is relocating physical smelting capacity into China.

> Norilsk Nickel (Nornickel) — closing its Arctic (Norilsk) copper plant > in Russia and building a replacement smelter in China via a joint venture > reported to be with China Copper (a subsidiary of state aluminium/metals > group Chinalco), input capacity ~2 Mtpa of copper concentrate, targeted > operational ~mid-2027. Motivation stated by CEO Vladimir Potanin: solve > "settlement, market-access and equipment" problems by producing inside China's > economy. Asia was 54% of Nornickel's revenue in 2023.

The tell for nickel specifically is the reported next step: Reuters (2024) reported Nornickel in talks with Chinese battery-materials firms (CNGR Advanced Material and Brunp Recycling among those approached) to build a China nickel plant fed by Russian semi-finished nickel product. That is the mode-B signature this corpus has already seen on the Indonesia side (Chinese-owned, Indonesian-origin metal): a controlled producer building real capacity abroad so its output ships under the new flag — here, Russian nickel units that would emerge as Chinese-origin battery precursor, invisible to any screen that reads the customs country-of-origin. Where the Indonesia case had Chinese owner / Indonesian flag, this is Russian metal / Chinese flag, jointly built.

Ownership/relocation hops: Investing News Network & Nasdaq ("Nornickel and China Copper consider JV"), Mining-Technology and Interfax (copper-plant relocation, ~2 Mtpa, mid-2027, Potanin quotes, Asia = 54% of 2023 revenue), Reuters (China nickel-plant talks with battery firms). Reported plans and negotiations — NOT a completed pipe, and NOT a per-shipment accusation.

The re-entry leg (mode B/C — labelled hypothesis, not quantified here)

The half a buyer cares about — does the banned metal come back? — is where this case is honest about its gap. Two channels, neither quantified:

• Mode B (prospective). Once the China nickel plant runs, Russian

semi-finished feed refined in China becomes Chinese-origin battery-grade nickel / precursor under substantial-transformation origin rules — the same mechanism that turns Russian crude into Indian diesel. China is the dominant exporter of battery materials to the West, so at the embedded-content level the "no Russian nickel" claim is undermined. This leg does not yet exist in the trade data (plant targeted mid-2027) — it is a watch item, not a measurement.

• West-facing leg (reported, unquantified here). A parallel channel — Russian

nickel still reaching Europe via LME-warehouse stocks and pre-13-Apr-2024 metal that remains deliverable — is reported (e.g. Global Witness on the "sanctions gap") but is not quantified in this case; I could not retrieve a primary figure I would stand behind, so it is left as a labelled open question, not a number.

Why this stays GATE 0: the diversion table is fully traced, but (a) the re-entry legs are inferred from fungibility and reported plans, not measured; (b) the flagship mode-B pipe is prospective (plant not built); and (c) free trade data cannot attribute the Russian-origin content of a Chinese-origin precursor — origin rules erase it by design. No figure is asserted for re-entry.

Why it matters for the buyer

1. A ban on an origin is not a ban on a dependency. The LME/US/UK action severed Russia's direct exchange-and-customs line, but the metal re-priced to China and Russia consolidated as China's #1 finished-nickel supplier (47.6% in 2024). An exposure model scoring "Russian nickel = 0" after April 2024 is reading a customs label, not a supply reality. 2. The FEOC / origin-rule blind spot, twice over. The Indonesia nickel case showed Chinese-owned, Indonesian-origin metal slipping past origin screens. This case adds Russian-origin metal that a joint Nornickel–China plant is being built to re-flag as Chinese-origin precursor. Both defeat frameworks that screen the customs flag rather than the economic origin — and here the two blind spots are being welded together. 3. It confirms the control is a revenue tool, not a supply cut. Volume rose while value fell; the market is oversupplied to ~2027. The action dents Nornickel's margins (the price channel) but leaves physical availability — and Western embedded exposure via China — largely intact. Two readings of one fact: the tap is real, but it drains east.

Method & honesty rails

• Trade data: UN Comtrade, reporter China, HS 750210 (unwrought

unalloyed nickel — the core refined-metal line), imports, annual, gross weight; parent HS 7502 and feed lines 7501 / powders 750400 also pulled into the artifact. 2025 annual not yet in the free preview; the series ends at 2024. Committed nowhere as a per-shipment claim.

• Diversion, not trans-shipment: the surging origin (China) can legitimately

buy and refine this metal — so this case does not rest on a zero-capacity implausibility. The signal is share-consolidation of a sanctioned origin into the one buyer still taking it, plus the mode-B relocation that will re-flag it.

• Magnitude honesty: the nickel diversion is quieter than aluminium's —

Russia's absolute tonnage is below its 2019 level. The load-bearing facts are the six-year-high 47.6% share and the ban-year recovery against a falling world total, not a headline multiple.

• Alternative-track only: never touches buyerRelativeScore or the base

exposure — it sits beside them, like the China–West price wedge.

• Inference, not accusation: the re-entry legs are inferred from fungibility,

origin rules and reported relocation plans; the China nickel plant is prospective; no individual shipment is asserted to contain re-flagged Russian metal beyond the public record.

• Nickel twin of the aluminium entry (R72): same 12–13 Apr 2024 OFAC/LME

package, same diversion shape, but with a mode-B relocation tell (physical capacity moving into China) that the aluminium case's upstream Rusal–HWNM integration only gestured at.

Anchor & sources

• Anchor action: 2022-03-01-us-ofac-russia-harmful-activities-sanctions-regulations

(31 CFR Part 587 — the OFAC regulatory framework under which the 12-Apr-2024 metals/mining sectoral determination was issued). Hand-off lead: the precise 12-Apr-2024 E.O. 14068/14071 metals-ban determination (JY2249) is not yet its own filed IPTM action — worth filing to anchor both this case and the aluminium twin directly.

• Control: US Treasury press release JY2249 (12 Apr 2024);

E.O. 14068 (import ban) + E.O. 14071 (LME/CME warranting/settlement bar).

• Trade: UN Comtrade free public preview API (reporter China 156, HS 750210 /

7502 / 7501 / 750400, flow M, annual); artifact data/intelligence/nickel-russia-circumvention.json.

• Production/share & relocation: USGS Mineral Commodity Summaries 2026

(nickel); Nornickel public filings; Investing News Network / Nasdaq / Mining- Technology / Interfax (copper-plant China JV, ~2 Mtpa, mid-2027, Asia = 54% of 2023 revenue); Reuters (China nickel-plant talks with battery firms).