The London Bullion Market Association said on Tuesday it had suspended the Ekaterinburg Non-Ferrous Metals Processing Plant from its gold and silver good delivery lists due to “ownership related issues”.
The refinery in Russia is controlled by Moscow-based conglomerate Renova Group, which along with its key shareholder, billionaire Viktor Vekselberg, was sanctioned by the United States on April 6.
The LBMA said in a notice the refinery would be removed from its active good delivery lists from May 14.
The good delivery lists contain refineries whose gold and silver bars meet the required standard for acceptability in the London bullion market, the world’s largest.
The London Bullion Market Association did not comment when asked whether the suspension was linked directly to the sanctions. “Due diligence in regard to the credibility of the lists is continuously reviewed on an ongoing basis,” LBMA chief executive Ruth Crowell said.
Suspension from the list makes it harder for for buyers and sellers to trade bars in the mainstream precious metals market, traders said.
“Our company would not touch any bars that are not LBMA-accredited,” one trader at a major precious metals house said. “Most probably they are going to be in a secondary market.”
The impact of the suspension on the global market was likely to be muted, traders said, as the bulk of Russian gold production remains in the Russian domestic market.
Russia produced 272 tonnes of gold last year, data from consultancy Metals Focus showed. The Russian central bank alone added 224 tonnes of bullion to its gold reserves in that time, while domestic jewellery consumption reached nearly 40 tonnes. (Reporting by Peter Hobson and Jan Harvey; editing by Jason Neely, Veronica Brown and Jane Merriman)