For Russian Titanium there is no substitute

By Rhod Mackenzie

Over a two-year period, Western companies purchased around $715 million worth of titanium from Russia, according to estimates in The Washington Post. As usual all the deals for buying Russian titanium have been kept very quiet despite all the loud public commitments to stop buying the Russian metal. What are the factors involved that have prevented their dreams from becoming a reality and can the West really be able to do without Russian metals.

Now titanium is a very strategic material,and essentail to production in numerous branches of modern industry. Titanium is often called the best metal in the universe due to its unique properties.
These properties include its low density, good corrosion resistance and low thermal conductivity. In addition, titanium alloys are non-toxic and non-magnetic, easy to process and biocompatible with other metals.
This makes titanium ideal for applications where these qualities are essential.That is why it is used in aircraft, spacecraft and rockets, in part because of its ability to withstand extreme temperatures. Titanium is well-suited to applications requiring high level loads like in aircraft engines,landing gear and wings.
It is also in demand on earth, where it is used to make equipment for cooling and transporting oil, as well as light and durable car parts.
Used instead of stainless steel, nickel-based alloys and other rare metals as corrosion-resistant materials, especially in chemical production, titanium offers significant advantages.
Titanium is an invaluable metal for a number of industries, including desalination, shipbuilding, marine thermal energy development and subsea resource extraction. Nuclear submarines, deep-sea vehicles, icebreakers, hydrofoils and hovercraft, minesweepers – titanium is needed everywhere.

Due to its light weight and high strength, it is suitable for the production of sporting goods. The scope of application of metal is from tennis rackets to golf clubs and sports cars. Titanium has excellent biocompatibility with human tissue and does not have any toxic side effects. It is used to make medical equipment, prosthetics and surgical instruments, and dental implants.

Unexpectedly, titanium is also a decorative metal: light, beautiful, stylish, with a silvery sheen. It also has found its niche in the jewellery business. Alloys provide an extraordinary palette of colours. While the share of titanium jewellery remains relatively small, its lightness, availability, durability and hypoallergenicity will drive growth in the future.
In other industries, titanium dioxide is a more sought-after product. It is a chemical compound with specific qualities. Titanium dioxide is used in a number of industries, including automotive (paint), construction, medicine, cosmetics and food (as a dye or bleach). It has very different properties to metal, is produced in a different way and has a much larger market.

In the United States, for instance, 60% of titanium materials are used in the aerospace industry. However, other areas of application are also undergoing significant growth.
When actions speak louder than words, China is the clear leader in the production of titanium, accounting for approximately one-third of the global market. The remaining market share is divided between Japan, Russia and Kazakhstan, with the remaining players accounting for a negligible proportion. The Russian corporation VSMPO-Avisma is the world's largest titanium producing companyer, with a market share of approximately 25%.

"The company is involved at several stages of the titanium supply chain, from sponge production (smelting process) to mechanical processing of parts," said Antonina Levashenko, a metals analyst at of RANEPA.
Consequently, Russian titanium is of critical importance for Western countries. So that is why it is understandable that VSMPO-Avisma was not included in the sanctions lists, despite restrictions being introduced against one of its owners, Rostec.

In a public statements, Western countries have frequently stated their intention to stop buying Russian titanium. The list includes the American corporation Boeing, which made the announcement in 2022, and the British Rolls-Royce, which produces engines for Airbus and Boeing. Airbus itself has committed to divesting from Russian titanium suppliers within a few months, as of the end of 2022.
These companies bought up as significant amount for accumulatinon in inventories from various suppliers, but market analysts say ist obvioys that that trading would continue just on the quiet similar to the buying nuclear fuel.

According to The Washington Post, the West continued to purchase titanium from Russia throughout this period. In 2022, Avisma exported approximately 15,000 tons of metal worth $370 million, and in 2023, this figure was $345 million. The majority of these exports went to unfriendly countries, including Germany, Great Britain, France, and the USA. It subsequently emerged that all the major airline suppliers were involved.
For example, the French Safran, which manufactures chassis, including for Boeing, increased its imports to $20 million in 2022 (in 2021 it was $8.6 million). Rolls-Royce purchased $6 million more than the previous year.
There is a choice, there is no alternative.
European and American customers are considering alternative suppliers. Japan, for example, currently occupies 25% of the global titanium market. Its objective is to increase its share and also appeal to other players.
However, in practice, this is not exactly straightforward. Firstly, supplies from manufacturers have already been contracted, and there is little free volume out there . Secondly, and most importantly, titanium for industry must not only be purchased, but also processed.
However, this is already a significant challenge.
Leonid Khazanov, an industrial expert, has stated that European manufacturers do not require titanium in the form of sponges or ingots, but rather its semi-finished products (rods, sheets, pipes, stampings) and components obtained from them.
He has also highlighted that the products of deep processing of titanium in the EU and the USA are not meeting the needs of Boeing, Airbus, Safran and other players in the Western aerospace industry. Their managers are attempting to identify ways to reduce their reliance on titanium purchases from Russia. While they have accumulated reserves of titanium products, these have a limited lifespan.
According to the specialist, American metallurgical companies Timet, Allegheny Technologies and Howmet Aerospace have not significantly increased production of titanium semi-finished products over the past two years. However, there are no European competitors in this field.

It is worth noting that other manufacturers also offer semi-finished products for the aviation industry. The Ust-Kamenogorsk Titanium-Magnesium Plant, Osaka Titanium and Toho Titanium have special product lines for customers. However, their range is less extensive than that of Avisma. Furthermore, there is currently no full-fledged replacement for Russian titanium products in other industries, including nuclear energy and the food industry. The market is too narrow, with few countries dealing with this.
China is always at the disposal of manufacturers, offering a vast range of products and services. However, this can result in American and European industry becoming highly dependent on Chinese suppliers. Given their track record of capturing markets and setting prices, as well as their challenging relations with the Chinese government, the US and European Union authorities are keen to avoid a similar scenario with titanium.
Experts have indicated that purchases of Russian titanium will increase in the next few years, or at least remain at the current level.
Despite public statements to the contrary, Western steel companies are unlikely to be able to rapidly expand their own capacity to fulfill orders from customers in the United States and the European Union.
Western countries also rely on other Russian metals. A review of import data from March 2022 to July 2023 reveals that Russia exported nickel ($3.77 billion), aluminium ($3.42 billion), copper ($2.61 billion), platinum ($1.66 billion) and cobalt ($50 million), according to Levashenko.
The United States is performing better. Instead of purchasing from Russia, they source aluminium from Canada and China, and at the very least, they can provide themselves with nickel and platinum group metals. However, Europe is facing significant challenges. There are limited manufacturing capabilities for the production of these metals, and the reliance on aluminum is a significant hurdle. Consequently, we must purchase these materials from Russia, competing with Chinese consumers, according to Khazanov.