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Industrial titanium demand recovering: ATI

Keywords: Tags  Allegheny Technologies, ATI, titanium, Richard Harshman, Yanbu 3, Doosan, Uniti, Frank Haflich

LOS ANGELES — Orders from large desalination and power plants have contributed to the start of a recovery for Allegheny Technologies Inc.’s non-aerospace industrial titanium business this year, according to ATI’s chairman, president and chief executive officer Richard Harshman.

“We are beginning to rebuild our backlog of high-value products for large global infrastructure projects,” Harshman told securities analysts.

Uniti LLC, a joint venture of Pittsburgh-based ATI with VSMPO-Avisma Corp. of Russia, recently received the balance of an order for commercially pure titanium strip that it will supply for the Yanbu Phase 3 seawater desalination project in Saudi Arabia, Harshman said.

In addition, Moon Township, Pa.-based Uniti also received in recent weeks a “significant” order for an electric power plant project that it declined to identify.

“As we enter 2013, we have nearly 4 million pounds of titanium strip in our backlog from these projects,” Harshman said.

The company did not disclose the value of the Saudi desalination order or the power plant order, but an ATI spokesman in Pittsburgh described the two projects as “a good start” in the recovery of its industrial titanium market.

Uniti’s strip will be supplied to an undisclosed pipe producer. While a portion of its total production for Yanbu 3 was shipped in the fourth quarter of last year, the majority is due to be shipped during 2013, Harshman said.

ATI has declined to disclose the total amount of strip it will make for the $1-billion Yanbu 3 project, on which Doosan Heavy Industries & Construction Co. Ltd. of South Korea was awarded the engineering, procurement and construction contract. In late 2010, Uniti secured its biggest job ever with a contract to supply 5.5 million to 6 million pounds of flat-rolled strip for conversion into pipe to be used in a seawater desalination project in Ras Az Zawr, Saudi Arabia, on which Doosan also was the primary contractor (, Dec. 17, 2010).

While this skelp was shipped in 2011, a dearth of global infrastructure work contributed to a 38-percent drop in ATI’s flat-rolled titanium shipments in 2012 from 18.1 million pounds shipped in 2011, mainly due to delays in “large global projects,” Harshman said. The company’s flat-rolled titanium shipments also include some alloy grades.

ATI’s other major producer of titanium mill products is its Monroe, N.C.-based Allvac Inc. unit, which produces mainly aerospace and other alloy long products.

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