Global shipments of titanium mill products, spurred by both commercial aerospace and industrial demand, will rise 7 to 10 percent this year after jumping more than 24 percent in 2011, Titanium Metals Corp. (Timet) forecast in documents filed with the U.S. Securities and Exchange Commission (SEC).
Dallas-based Timet, which estimated that it accounted for 15 percent of all global mill product shipments in both 2010 and 2011, estimated in the SEC filing that the global industrys dispatches grew 24.1 percent to 108,000 tonnes (about 238.1 million pounds) last year from 87,000 tonnes (191.8 million pounds) in 2010.
This years expected increase will be "driven by continued growth in the commercial aerospace and industrial sectors," Timet said in the SEC filing. Industry shipments to the commercial sector last year were up 14 percent as aircraft build rates and supply chain inventory levels rose to support both current production and the anticipated increase in output levels into 2012, the company said.
Richard J. Harshman, chairman, president and chief executive officer of Pittsburgh-based Allegheny Technologies Inc. (ATI), estimated that his companys titanium shipment growth rate will slow to 7 to 8 percent this year from 20 percent in 2011. Harshman said that ATIs growth in aerospace is "on the jet engine side," both in terms of mill products as well as the forgings and castings produced by its Cudahy, Wis.-based ATI Ladish unit, which it purchased last year. The sector also includes nickel-based alloys.
Jet engines accounted for 15 percent of ATIs total corporate revenue of $5.18 billion last year, presumably reflecting in part ATIs acquisition of Ladish, with engine-related sales rising 78 percent from the previous year. The airframe sector accounted for 8 percent of revenue, with sales up 18 percent.
Meanwhile, the global market could get more competitive now that the fledgling Mexican aerospace industry has won admittance to the Wassenaar Arrangement, an international group established in 1995 to control the sale of military equipment, including small arms, tanks and aircraft.
"It will allow us to enter the (military air) defense market . . . which according to my estimates is four to five times larger than the commercial aerospace sector globally," said Carlos Bello, managing director of Mexican aerospace industry association Femia. Exports by Mexicos aerospace industry rose to $4.5 billion last year from $3.4 billion in 2010, and he expects exports to top $5.1 billion this year, reach $7.5 billion in 2015 and perhaps exceed $12 billion by 2020.