Higher Import could Cool Japan Rolled Titanium Market

Japanese rolled titanium supply could get oversupply as early as in 2008 after the tight supply position. Japanese buyers increase the sponge material import from China and the buyers could increase the titanium ingot import from China. Some Japanese dealers and users concern potential price drop with uncertainty for the demand. Japanese largest titanium sponge maker, Osaka Titanium Technologies completes first phase of new plant construction in January 2009. Japanese interests expected the additional supply could ease the tight supply condition for rolled titanium products in and after spring 2009. But the additional imported materials could balance the supply condition as early as autumn 2008. Chinese sponge titanium output is expected to reach annual 100,000 tonnes in years, which represents around half of the world production. Japanese sponge and ingot titanium import from China increased to 2,362 tonnes in 2007 topping 2,208 of import from Russia. Japanese titanium import from Ukraine also increased to 412 tonnes in January-February compared with 333 tonnes from Russia. Titanium ingot production also increases worldwide. Some Japanese interests expect Japanese buyers import titanium ingot made with Chinese sponge materials from third countries. Japanese buyers could import rolled titanium from China when some users test Chinese rolled products. A heat exchanger processor said Chinese quality is no problem at least for plate and forging products. Japanese rolled titanium makers succeeded to get more than 5% hike for fiscal 2008 from previous year. However, some dealers consider if they should reduce the inventory when the additional import sources could cool the market mainly for commodity grade products.