EU backs Silmet’s shift away from Russian raw materials

Silmet will stop receiving mainly Russian raw materials and expand production with European support, ERR reported. Neo Materials, the Canadian-listed owner of the Sillamäe factory, said the changeover to new suppliers and expansion work will slow or halt production on its separation line.

The expanded production is expected to be three times the current level, business daily Äripäev reported. Neo has not disclosed a final timeline or the investment required. Postimees reported that the company had told Estonia it was waiting for its last shipment from the Solikamsk magnesium plant, which it expects will help it get through the coming winter. Silmet has said its supply chain with Solikamsk will end by the close of this year.

Last week, the European Commission designated Neo’s Silmet 2.0 modernisation programme a strategic project. Neo said the status would give it priority in administrative procedures, faster permitting and easier access to current and future European Union funding. The amounts of any funding, including applications already made, have not been disclosed.

The news follows an agreement to exclude a Russian supplier to Silmet from the EU’s proposed 22nd sanctions package against Russia, at Estonia’s request. The package has not yet been approved. Estonia’s Foreign Ministry said it had pressed Silmet to stop using Russian raw materials, but the company had not done so.