The war that Russia has waged on Ukraine has rocked global commodity markets, and not just in the oil and gas sector per a report from Interact Analysis analyst Blake Griffin.
Griffin notes that the disruption of many of these materials will have both direct and indirect impacts on costs associated with producing a motor or drive. He says the impact of the supply of aluminum and copper wire is two-fold.
Russia is responsible for approximately 6% of the global aluminium supply according to CNBC. In late 2021, the world bank had forecast a price increase of ~5% during 2022 for aluminium. Now that a war has broken out, Interact Analysis expects that price forecast to be on the conservative side. Prices are rising, hitting record highs in February.
Interact Analysis expects that to rise even further as transportation costs are rising.
Copper wire prices will have a similar, albeit slower, impact. Nearly 7% of the worlds supply of copper wire, the same used in induction motors, comes from Russia. This will have an immediate and significant impact on the cost and availability of copper wire used in induction motors.
The semiconductor shortage has been a major concern for motor drive suppliers. Many suppliers stocked up on neon prior to the war. However, if the conflict does not resolve in a timely manner, these stockpiles could run out. Should this occur, the semiconductor supply could once again fall into disarray and drive suppliers would face sourcing problems similar to the ones at start of the semiconductor shortage in early 2021.