Bloomberg: Five major commodity industries are experiencing an energy crisis

The energy crisis is increasing pressure on key sectors of the global economy. According to the agency Bloomberg, producers of industrial and green metals, as well as steel, fertilizers and sugar are forced to reduce production costs. In addition, manufacturers of materials for electric vehicle batteries and solar energy production are experiencing difficulties.

First, the energy crisis affected the production industrial metals. As noted by Bloomberg, Europe has already lost about half of its zinc and aluminum smelting capacity over the past year. This week, Norwegian steelmaker Norsk Hydro ASA announced plans to close an aluminum smelter in Slovakia at the end of September due to soaring electricity prices, while global steelmaker Nyrstar announced the shutdown of Budel’s giant zinc smelter in the Netherlands.

As Bloomberg notes, the energy crisis also affected production become. A drought-related power outage in China’s Sichuan province has affected more than 70% of local steel mills, shutting down or limiting production. In addition, at least two US steel mills have begun suspending some operations to cut energy costs.

Production green metals, such as lithium and polysilicon, has declined due to the energy crisis in China. In 2021, Sichuan accounted for more than a fifth of China’s lithium production, according to BloombergNEF. According to the agency, analysts expect prices to rise in the short term.

World exporters fertilizer, including China, are cutting supplies to other countries due to fears of a food crisis. At least a quarter of Europe’s nitrogen fertilizer capacity has already been lost, according to Bloomberg, and the International Fertilizer Association predicts that next season, global fertilizer consumption will hit a record drop since the 2008 crisis.

Analysts cited by the agency believe that world food prices will rise due to an increase in prices for sugar. Suedzucker AG, a German sugar corporation, has warned of rising prices due to the redistribution of costs in case of an emergency due to the cessation of Russian gas supplies.

Anastasia Larina