* Eramet says Norilsk would sell to Asia if targeted by West
* Europe would be hurt by higher nickel premiums
* French miner concerned about Ukrainian manganese alloy maker
PARIS, July 30 (Reuters) - An embargo against Norilsk Nickel as part of Western sanctions against Russia would hurt nickel users in Europe and the United States rather than Norilsk itself, the head of French mining group Eramet said.
Norilsk, the world's largest producer of the stainless steel ingredient, has not been targeted so far by western measures aimed at punishing Russia for its support of pro-Moscow rebels in neighbouring Ukraine.
"Nobody expects sanctions against Russia and Norilsk would affect Norilsk's production since it would sell to China if it couldn't sell elsewhere," Eramet Chief Executive Patrick Buffet said during a presentation of Eramet's first-half results on Wednesday.
"It's unlikely an embargo by Europe would materialise, because it would be shooting itself in the foot, since Norilsk could ship its production to Asia, creating a shortage in Europe and oversupply in Asia. The consequence would be a jump in physical premiums in Europe and a discount in Asia," he added.
The most likely scenario for western restrictions against Norilsk would be a U.S.-only embargo, which would push up nickel premiums there but not hit the world market, Buffet added.
Nickel prices have already rallied this year after a ban by Indonesia on nickel ore exports curbed supply to China.
A joint embargo by the United States and Europe against Norilsk would contribute to that rally, but the biggest impact on world prices is likely to come from an expected upturn in Chinese demand, Buffet said.
Chinese stocks of Indonesian nickel ore are estimated to have fallen by half in the past five months, suggesting they could run dry within the next few months and prompt a jump in Chinese import demand, Eramet executives said.
Eramet reported earlier on Wednesday that it had swung back to an operating profit in its first half as higher prices helped curb losses at its nickel division.
In manganese, the carbon steel ingredient which Eramet also mines and processes, there was uncertainty surrounding Nikopol, a major manganese alloy producer in Ukraine that has been caught up in the crisis there, Buffet said.
After Nikopol's owner, the Privat Group, publicly backed the Ukrainian government against Moscow, Russian steel makers have been looking for alternative suppliers, which could lead Nikopol to offload some supply in Europe, he said.
"This is obviously a concern, and it reinforces our policy of expanding in refined alloys," he said.
A lack of investment in Nikopol's plant in the Dnipropetrovsk province means, however, it no longer has a big competitive advantage over European producers as it did in the past, Buffet added. (Reporting by Gus Trompiz; editing by Michel Rose)