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  • Lord Copper

Fish or Meat?

The first time I went Siberia was just a few years after the implosion of the Soviet system and a couple of years into the presidency of Boris Yeltsin. On a cold, grey, snow-swept morning, we arrived at what to us looked like a deserted military airstrip outside an industrial city that had been a place of exile during Tsarist times and later a hub of the Soviet gulag system. The reason we were there? Well, the Soviets had built industrial production units out in the middle of the Siberian taiga to keep them well out of range of cold war western missiles. Our specific interest was one the world’s larger aluminium smelters, powered in turn by Russia’s second (and the world’s fifth) biggest hydroelectric power plant. This was at the time of the Yeltsin ‘voucher’ privatisation scheme, when the President undertook to transform the creaking communist economy into a bright shining example of capitalism. Well, I’m not going to debate here about whether a state kleptocracy is better or worse than a free-market one, but there’s no question that the change created lots of opportunities. 

So given that for a variety of reasons it was not feasible for western public companies (of which we were one) to invest directly in these kind of privatised assets, our fixer (although I’m sure he would rather I called him a trader) had come up with a scheme whereby he would be given authority to trade both physical metal and LME futures on behalf of the smelter, since the expertise of the management was in the production, not the commercialisation, of their product. With us was one of our colleagues from a different area of our business, but she had the invaluable skill of being fluent in Russian; she spent a very long time  that trip standing translating the questions of the Russian management and our answers to those questions. It was all so different from the old days, when they produced the aluminium and somebody sent in rail trucks to cart it away to wherever the command economy dictated it should go that week; or, indeed, different from the toll smelting period, when a western trader delivered the raw materials at the same time as taking the same value of metal (or at least, that’s how it was supposed to work…). Now, they had to understand an international market, supply and demand considerations, pricing and have a much better feel for the logistics. That’s what we had to try to explain convincingly.

Anyway, the discussions dragged on, through seemingly endless meetings, punctuated by full-on lunches and dinners. Full-on in the sense of vodka and beer, and toasts to our co-operation, our respective companies, Russo-British understanding, Uncle Tom Cobbleigh and all. Each meal was the same, though. A bit of salad, some smoked fish – I’m far more careful now of the texture of some smoked fish – and then the waiter, standing behind one, posing the question – “Fish or Meat?” For a short while – a very short while – I thought the question actually indicated a serious choice. How wrong can you be? Maybe one started out living in a field and one in a river, but by the time they had both spent a rather long time in very heavy duty frying fat, the distinction had long disappeared and they were totally interchangeable. My first world problem, I guess.

But we came to a deal, in the end, which worked for a couple of years, until the money ran out, at which point we tried to work something out for them with some of our banker friends. By then, though, the writing was on the wall and the consolidation of assets which ultimately resulted in Rusal had begun, squeezing out independent deals. 

As well as the smelter, while there, we had a look at the hydro dam. That was my first experience of walking down through a dam, and it was in many ways quite disturbing. A shack with a door on the top of the dam gave access to a staircase which wound its ill-lit way down and down through the concrete to the control room, where the engineers operated the various valves and turbines that directed the water in the required direction. At the top of the dam, the river was frozen; the water flowed from below the ice into the dam, and then was spat out at the bottom. Two hundred-odd metres downstream it was already frozen again. Why did I say disturbing? Because I couldn’t get the thought out of my mind that this was built by slave labour, which may not have been fully committed to high standards of construction. How many millions of tonnes of water was it holding back? And then in that minus twenty temperature, our hosts took us for a riverside picnic. Fish or meat, again, obviously, washed down with Georgian brandy. For students of history, that river, the Yenisei, was the demarcation line agreed by the German Reich and the Japanese Empire as the meeting point for their armies when they invaded Russia from each side, and would then form the frontier between the two (self-designated) super-powers. That didn’t work out too well, of course.

Finally came the rolling mill, an eerie experience. Would we like to see the rolling mill, they asked? Yes, we replied, by all means. So we drove on past the smelter this time, and arrived at a long, long industrial building. Inside was the rolling mill, bought from, I believe, Austria (may have been Germany), sitting all wrapped up in its packing cases. The Soviet regime had decreed that the smelter should have a rolling mill attached to it, and the building was erected and the kit purchased. But that was it. Caught by the change of circumstances, by the economics rather than the politics of industry, when the regime changed, it became superfluous. And so it sat there, machinery wrapped in oiled paper and packed in wooden cases. For all I know, it’s still there, a silent rolling mill slumbering in the middle of Siberia.

It was a fascinating period, although short-lived, seeing the change from a command to a free-market economy. Some things good, some things bad – I’m not making a political point. I’m sure many readers had far more experience than me of this time, but I found it one of the most interesting periods of my career.

(For those who are interested, this factual background found itself fictionalised in the novel “Czar Rising”, available here:




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