LOS ANGELES Raw material prices arent expected to
be a problem for titanium producers next year.
Dawne S. Hickton, vice chairwoman, president and chief
executive officer of RTI International Metals Inc., said that
the Pittsburgh-based producer completed its annual titanium
sponge negotiations for 2013 at the International Titanium
Association (ITA) annual conference last month.
"Based upon the outcome of these meetings, we expect our
overall raw material costs for next year to be relatively flat
to this years costs," Hickton told investors during a
quarterly conference call.
RTIs blended cost of sponge rose 8.5 to 9.5 percent in
2012 as the Japanese producers who are its primary source of
supply faced huge hikes in rutile feedstock costs in the second
half of 2011 and the first half of this year.
RTI didnt break out the increase it paid on the
portion of its total 2012 sponge the price of which was
negotiated for this year compared with sponge already in
inventory or that of already determined prices. However,
industry sources have estimated that Japanese sponge
producerswho are by far the largest source of outside
sponge purchased by U.S. titanium meltersraised their
prices by 25 to 30 percent in 2012.
Hickton declined to disclose whether RTI paid any increase
on the portion of sponge for which 2013 prices were recently
negotiated. She did point out that RTIs raw material mix
includes not only sponge but also scrap, which has been coming
down in price this year.
"Right now, its a little premature to for us to
determine where all of our mix is going to come from" in 2013,
Others who met with Japanese sponge producers at the ITA
conference suggested there will be "no increase or decrease" in
sponge prices next year.
Theres speculation that some sponge prices for 2013
might not be finalized until after this coming week, when
discussions in Hong Kong that also would involve sponge
suppliers outside Japan could result in lower prices,
especially for non-aerospace, industrial titanium