Toho Titanium Weighs Options for New Titanium Sponge Plant

Toho Titanium Factory

Japan's Toho Titanium is contemplating the establishment of a new titanium sponge production facility, potentially in the US, Saudi Arabia, or Japan, as the company revealed to Metalnomist. This move is driven by the expected surge in demand from the aerospace sector, with original equipment manufacturers (OEMs) accelerating aircraft production.

Toho Titanium aims to finalize its decision on the project within this year, although specific locations and production capacities are still under review. While the company has not disclosed the capital expenditure (capex) or a construction timeline, market observers estimate that the investment required would be at least $300 million, with any new site likely taking around four years to become operational.

As a point of reference, Toho Titanium’s joint venture with Saudi firm AMIC, which resulted in a 15,600 t/yr sponge plant in Saudi Arabia, was announced in 2014, commenced construction in 2015, and began commercial production in 2019. The project involved an investment of $420 million.

Among the potential locations, Saudi Arabia is favored for its lower electricity costs. Toho is also considering the US, which would offer proximity to major titanium sponge consumers like Titanium Metals (Timet), ATI, Howmet, and Perryman. Alternatively, the company may expand its existing operations in Japan.

The acceptance of a Japanese sponge plant in the US is uncertain, especially after the opposition to Nippon Steel’s proposed acquisition of US Steel. Furthermore, in March, several US senators introduced a bill to suspend duties on titanium sponge imports, facilitating imports from Japan. This bill, supported by all four major US melters, suggests no immediate plans from Timet or ATI to restart idled domestic capacity at Henderson or Rowley.

Last month, Japanese titanium producer Osaka Titanium announced a ¥30 billion ($191 million) investment to build a new plant in Amagasaki, which will increase its titanium sponge capacity from 40,000 t/yr to 50,000 t/yr.

Investments from Toho and Osaka, along with continued procurement from Russia’s VSMPO-Avisma, could delay the anticipated deficit in the aerospace sponge market. The acceptance of Chinese sponge remains a contentious issue, with concerns about consistent production quality, especially given the industry's emphasis on quality and safety compliance.

Near-Term Challenges vs. Longer-Term Growth

The recovery in demand for widebody aircraft for international travel is set to be the primary driver of titanium consumption in the coming years. European firm Airbus aims to produce 12 aircraft per month by 2028 for its A350 program, while US firm Boeing targets 10 per month by 2026 for its 787 model.

In the short term, supply chains are struggling to match the recovering demand. Airbus CEO Guillaume Faury noted in the company’s April earnings call that although the issues are manageable on a case-by-case basis, the overall environment remains challenging.

Despite downstream production setbacks and persistent supply chain limitations, the demand for titanium sponge upstream remains strong. Melters, forgers, and parts manufacturers are increasing their inventories of titanium products in anticipation of higher demand in the latter half of the year.

Titanium Scrap Demand and Prices Expected to Rise in 2025, Driven by Boeing Recovery and Melter Expansions

Titanium Scrap

The outlook for titanium scrap is becoming increasingly positive as demand is expected to surge in the second half of 2025. This rise is driven by a recovery in aerospace manufacturing, particularly from Boeing, and planned expansions in titanium melting capacity. These factors are expected to have a significant impact on the titanium scrap market, which has faced challenges throughout 2024.

Boeing and Aerospace Recovery

After a year marked by disruptions in production schedules and supply chain bottlenecks, aerospace manufacturers are expecting a rebound. In 2024, the anticipated increase in titanium scrap demand did not materialize as expected, largely due to production missteps at Boeing and delays in Airbus’s ramp targets. However, a recovery in Boeing's production, particularly of the 737 MAX and the 787 Dreamliner, is poised to fuel higher scrap consumption.

Boeing’s 737 MAX production, which was temporarily halted due to a seven-week strike, is set to resume, providing a strong signal for the titanium scrap market. The 787 Dreamliner, which contains about 15% titanium compared to 6% for the 737 MAX, will also contribute to increased demand. Despite facing parts shortages earlier in 2024, Boeing has indicated that it will resolve these issues by the end of the year, paving the way for normalized production rates in 2025.

Titanium Melters’ Expansions and Ingot Production

Another key factor influencing the titanium scrap market is the expansion of titanium melters’ capacity. With new ingot production facilities scheduled to come online in 2025, there is a clear indication that titanium melters will be looking to source more aerospace-grade scrap to feed their new furnaces. Companies such as ATI, Titanium Metals (TIMET), and Perryman are investing heavily in capacity expansions to meet growing demand for titanium products.

ATI’s expansion at its Richland, Washington, operations will increase melting capacity by 35% over 2022 levels, while TIMET’s new plant in Ravenswood, West Virginia, is expected to produce 33 million lbs of ingot annually once fully operational. Perryman, meanwhile, is ramping up its facility in Coal Center, Pennsylvania, increasing its melting capacity by 16 million lbs to 42 million lbs annually. These expansions are expected to create more competition for available titanium scrap, potentially driving up prices.

Impact of Tariffs and Political Uncertainty

However, the market remains uncertain due to potential changes in U.S. trade policies under President-elect Donald Trump. Trump’s proposed tariffs, which could impose duties of up to 60% on imports from China, 25% on imports from Mexico and Canada, and a 20% duty on all other imports, have raised concerns among market participants. Such tariffs would increase the cost of titanium scrap imports, particularly from regions like Europe and Japan, which could be devastating for the industry if they are implemented.

Titanium scrap imports to the U.S. have already increased significantly in 2024, reaching 23,578 metric tonnes through October, surpassing the previous year’s total. While the threat of tariffs remains uncertain, it could create additional market disruptions that would further complicate the scrap supply chain.

Conclusion

While 2024 proved to be a challenging year for the titanium scrap market, 2025 is shaping up to bring a significant rebound. The resumption of Boeing's production and continued expansions in titanium melting capacity should drive stronger demand for aerospace-grade scrap. However, political uncertainty surrounding tariff policies remains a major wildcard that could affect the broader market dynamics. As the industry braces for these changes, stakeholders are carefully watching for signs of recovery and growth.

US titanium scrap-sponge ratio set to shift as melters chase margins

Titanium Scrap

The US titanium scrap-sponge ratio is poised to shift as melters chase cheaper inputs in 2026. Premium titanium sponge prices and weak downstream demand are squeezing margins and forcing producers to reconsider melt mixes. As a result, the US titanium scrap-sponge ratio could move decisively toward higher scrap utilization across many grades.

Furnace expansions support higher scrap utilization

Capacity expansions at ATI, Perryman and Timet will give melters more room to adjust the US titanium scrap-sponge ratio. Their projects are expected to add nearly 30,000 t/yr of ingot production capacity once fully ramped, according to Metalnomist estimates. Consequently, scrap utilization capacity could rise by 22pc to 111,215t in 2026 compared with 2024, ELG Utica Alloys’ Nick Corby told the International Titanium Association conference.

However, not every alloy can fully pivot away from sponge, because certain grades still require premium sponge for purity. Grade 5 (6Al-4V) ingot can be melted from 100pc scrap, which encourages a higher US titanium scrap-sponge ratio when prices favor recycled inputs. Importantly, melters can alter the scrap and sponge ratio without major downtime, allowing them to track raw material prices and supply conditions in real time.

Meanwhile, destocking in commercial aerospace could cap the practical impact of these technical options. Boeing and Airbus are signalling another year of subdued orders for ingot and milled products as they normalise inventory. This means melters already grappling with weaker demand may push deliveries out or no-quote dealers on certain grades, even as the US titanium scrap-sponge ratio tilts structurally toward scrap.

Global scrap flows deepen market distortions

Scrap sourcing dynamics will play a critical role in how far the US titanium scrap-sponge ratio can shift. The US accounts for around 95pc of global consumption of aerospace-grade titanium scrap, making it the natural sink for high-grade revert. Imports are crucial, covering more than half of US raw material needs and bridging gaps in domestic generation.

Historically, Europe supplied much of this scrap, reflecting its strong base of forging and machining operations. Long-standing supply agreements and buy-back schemes cemented a circular flow of titanium between the two regions. However, shifts in downstream processing toward Asia are eroding Europe’s share, even as titanium activity in countries like China accelerates.

China is on track to increase global titanium scrap exports by 64pc in 2025 to 5,874t, with most of that likely moving into the US. Officially, the US has only imported 434t of titanium scrap from China this year, US Commerce Department data show. Yet market participants say Chinese-origin scrap often reaches the US via other Asian countries to circumvent 25pc tariffs, complicating visibility.

As a result, the supply chain looks “inconsistent”, with scrap availability not matching lower generation rates caused by delayed aircraft build schedules and OEM stockpiles. Corby noted that imports are expected to exceed exports by 19,460t this year, the widest gap since records began. At the same time, European ferro-titanium consumers face weak steel demand and index-driven price pressure, cutting their appetite for scrap and pushing more material toward US buyers.

The Metalnomist Commentary

The evolving US titanium scrap-sponge ratio highlights how price signals, furnace investments and trade flows interact across the titanium ecosystem. For melters, flexibility in melt mixes is becoming a strategic hedge against stubborn sponge prices and volatile aerospace demand. For scrap generators and intermediaries, rising US dependence and opaque routing via Asia could keep differentials wide — and margins attractive — well into the next aerospace upcycle.

Boeing titanium joint venture remains uncertain despite Russia’s overture

VSMPO-AVISMA

Russia signaled interest in reviving the Boeing titanium joint venture with VSMPO-AVISMA. However, Boeing has not indicated any plans to return. Sanctions, tariffs, and long requalification timelines complicate any restart of the Boeing titanium joint venture. Supply chains have shifted since 2022 and will not reverse quickly. The Boeing titanium joint venture once lowered logistics costs and secured critical forgings.

Ural Boeing Manufacturing’s past and the sanctions hurdle

Ural Boeing Manufacturing previously machined titanium forgings for the 787 and 737. The partnership expanded in 2010 and planned a second site in 2013. Boeing cut ties in March 2022 after Russia’s invasion. The US later imposed 70% tariffs on Russian unwrought titanium. VSMPO also faced export sanctions in 2023. These measures deter direct commercial engagement. Any revival would require regulatory relief and political alignment.

How Boeing filled the titanium gap

US and allied producers expanded premium-grade capacity after 2022. ATI added electron-beam melt for rotating-grade titanium. Perryman expanded melt and conversion capacity. TIMET is ramping a new Ravenswood ingot mill. Aerospace buyers still face long part qualifications. New PQ supply takes two to five years to certify. Boeing’s recovery also shapes demand. The 737 MAX returned to 38 jets per month. The 787 rose to seven per month.

The Metalnomist Commentary

Even if sanctions eased, a rapid restart looks unlikely. Boeing diversified supply and invested in non-Russian PQ routes. Reversing that shift would add risk without clear benefits.

Aerospace OEMs Look to Reduce Dependency on Russian Titanium

VSMPO

Aerospace OEMs, including Airbus and Safran, are working to reduce reliance on Russian titanium as supply chain challenges grow due to rising tensions.

The Shift Away from VSMPO-AVISMA 

As global tensions escalate, aerospace original equipment manufacturers (OEMs) like Airbus and Safran are actively working to decrease their reliance on Russian titanium producer VSMPO-AVISMA. The urgency of this shift has heightened since Russian President Vladimir Putin’s recent call for export restrictions on critical metals like titanium, nickel, and uranium.

Airbus Multi-Sourcing Strategy

Airbus, a leading European aircraft manufacturer, is well-positioned in the short-to-medium term thanks to its diversified network of metal suppliers. An Airbus spokesperson told Metalnomist that efforts are underway to secure supply chain resilience through multi-sourcing strategies. However, Airbus has refrained from specifying a timeline for when it will completely sever ties with Russian suppliers.

Safran

Safran’s Progress Toward Decoupling 

French aerospace manufacturer Safran has been reducing its reliance on Russian titanium since February 2022. The company has made significant strides in qualifying alternative, non-Russian sources of titanium. According to a Safran representative, while the qualification of new suppliers takes 2-3 years depending on the complexity of the parts, the process is nearly complete. However, scaling up production to meet current demand remains a challenge across the industry.

Challenges of Securing Alternative Supplies 

VSMPO-AVISMA is the world’s largest titanium producer, and transitioning away from its supply chain has been a complex process for aerospace OEMs. One of the key obstacles is the exclusive contracts in place for critical parts like landing gear components, as well as the limited capacity for producing large-scale forgings and machining operations. Airbus acknowledged in October that it continues to honor its existing contracts in compliance with international sanctions, but reiterated its long-term goal of decoupling from Russian supply chains.

Boeing and the U.S. Response 

In contrast to Airbus, American aircraft manufacturer Boeing ceased all procurement from VSMPO-AVISMA in March 2022. Boeing also ended its forgings joint venture with the Russian company, Ural-Boeing Manufacturing. The U.S. has since imposed a 70% duty on titanium imports from Russia, further isolating the Russian supplier from the American market.

RTX

The Role of Nickel and Titanium in Aerospace 

Titanium plays a vital role in aerospace applications, including structural parts, fasteners, compressor blades, landing gears, and heat exchangers. Nickel, another metal facing export restrictions, is primarily used in high-temperature superalloys for the hot core of jet engines.

Global Sanctions and Industry Reactions The EU has yet to implement sanctions specifically targeting VSMPO, a move that contrasts with the more aggressive stance taken by the U.S. and Canada. Canada’s direct sanctions on VSMPO initially impacted companies like Airbus and Bombardier, but both received exemptions. U.S.-based RTX, however, faced complications and had to secure new titanium sources for its subsidiary, Collins Aerospace, which manufactures landing gear in Canada.

Future Prospects for Titanium Supply 

In response to the growing demand and the void left by VSMPO, U.S. titanium melters such as Timet, ATI, and Perryman are expanding their ingot melt capacities. Similarly, Japanese producers Toho Titanium and Osaka Titanium are investing in capacity expansion, though these efforts are expected to take several years to fully materialize.

Uncertainty Around Russian Export Restrictions 

Whether Russia will move forward with its export restrictions remains uncertain. Safran has stated it has no further information beyond Russia’s public statements, and Airbus has declined to comment on the matter. VSMPO’s largest shareholder, Industrial Investments, holds a 65.27% stake, while the Russian state-controlled defense firm Rostec owns 25%. Putin’s call for restrictions came with the caveat that they should not harm Russia, leaving the industry in a state of uncertainty.

US Titanium Mills Respond to Tariff Challenges with Strategic Shifts

US Titanium Mills: ATI

Focus Keyphrase: US Titanium Mills

US titanium mills are navigating a complex tariff environment following the Trump administration’s implementation of a 10% baseline import duty. Despite exemptions for some titanium forms, critical alloying elements and shop supplies remain exposed to tariff-driven cost pressures.

Major players like Howmet Aerospace and ATI have issued formal notices to customers. Howmet declared a force majeure on affected contracts, while ATI announced immediate price increases. Meanwhile, Perryman and Timet have adopted more cautious stances, opting to wait for further clarity before adjusting operations.

Exemptions and Exposure: What’s Included and What’s Not

The tariff exemptions cover some titanium feedstocks and semi-finished products.

However, vanadium pentoxide and other alloying materials used in aerospace titanium production were not exempted.

As a result, producers are adjusting to avoid significant cost overruns. ATI emphasized that tariffs “will significantly raise the costs to produce material,” and pricing must adapt. Howmet has opened the door to cost-sharing arrangements with customers, but its notice signals potential supply disruptions.

Industry Impact and Ongoing Uncertainty

The broader aerospace supply chain is at risk of increased pricing volatility. Both ATI and Howmet are evaluating sourcing alternatives to cushion downstream effects. Perryman’s reserved approach reflects industry-wide uncertainty as global suppliers weigh reciprocal measures.

It remains unclear how much of the tariff burden can be passed along. Producers and buyers alike now face an evolving cost landscape shaped by trade policy, production inputs, and customer flexibility.

The Metalnomist Commentary

The reaction from US titanium producers signals a critical tension point between trade protectionism and material supply chain security. As cost pressures rise, manufacturers may need to reassess sourcing and pass-through strategies in an increasingly volatile market.

New Titanium Mill Set for North Carolina

A new titanium manufacturing plant is set to rise in Fayetteville, North Carolina, with a significant investment of nearly $868 million. The facility, spanning 500,000 square feet, will produce aerospace-grade titanium, according to the state's commerce department.

The venture, operated under the name Project Aero by American Titanium Metal, is expected to create over 300 jobs in the area. The site will utilize recycled scrap metal to "melt, roll, and finish titanium," as disclosed by a spokesperson to Metalnomist. Georgia and Texas were also in contention as potential locations.

To support this project, North Carolina's economic investment committee has approved a job grant that could provide up to $8 million in incentives over the next 12 years. Additionally, the Cumberland County commissioners board sanctioned up to $1.3 billion in bonds to attract the project.

Specific details about the facility's production capacity remain undisclosed, and information about the company is limited. American Titanium Metal was incorporated in Delaware on September 11, 2023, with a third-party service acting as its registered agent.

This new mill will bolster domestic supplies of titanium, a metal highly valued in the aerospace and defense sectors for its heat resistance and strength-to-weight ratio. Other companies like Perryman Group, ATI, and Titanium Metals (Timet) are also slated to expand their titanium melting capacities by 2026 to meet rising demand.

TITANIUM USA 2025: Global Titanium Hub Convenes in Boston

TITANIUM USA 2025

TITANIUM USA 2025 brought the titanium industry to Boston for three days of high-level exchange. Hosted by the International Titanium Association, TITANIUM USA 2025 gathered producers, processors, distributors, and end-users. Attendees used TITANIUM USA 2025 to network, share technology, and advance titanium supply chains.

Program showcases technology and networking

The conference delivered general sessions, workshops, and receptions across two days. Exhibitors and delegates held hundreds of business meetings on site. As a result, companies aligned on projects spanning aerospace, defense, and medical applications.

ITA anchors global collaboration and education

The ITA has connected buyers and technical experts since 1984. It promotes research, metallurgy, design, and engineering across the titanium value chain. Therefore, the association continues to build skills from shop floor to C-suite through publications and seminars.

Leading titanium companies underscored market depth in Boston. Timet, ATI, Carpenter Technology, and Perryman participated alongside technology firms. Meanwhile, STS Metals and IperionX highlighted innovations for high-performance components.

Titanium’s properties drive persistent cross-sector demand. High strength-to-weight ratios and corrosion resistance suit extreme environments. Consequently, titanium remains strategic for aircraft engines, implants, and industrial systems.

The Metalnomist Commentary

Boston’s gathering reinforced titanium’s role in mission-critical supply chains. Expect tighter partnerships between producers and OEMs as qualification needs rise. Education and process innovation will remain decisive differentiators in 2026 planning cycles.