Toho Titanium Eyes Wider Sponge Production Cut

Toho Titanium’s president Takeshi Kurushima said at press conference on Tuesday the firm would expand the production cut from current 40% at Chigasaki plant in Kanagawa if the sponge titanium demand would keep low level until April 2010 when the firm launches new Wakamatsu plant in Fukuoka. He said the firm plans to make 8,620 tonnes of sponge titanium in fiscal 2009 started April, which is 37% lower than fiscal 2008.

Mr. Kurushima expects inventory adjustment of titanium could take longer time than other materials due to the longer lead time. He indicates the firm would keep 40% production cut through 2009. He said the firm starts Wakamatsu plant operation at monthly 500 tonnes level. He said the firm would increase the production at Wakayama, instead of Chigasaki to cover higher depreciation for new facility, if the demand would recover.

The firm started 15% production cut in late 2008 at Chigasaki plant with 1,200 tonnes of sponge titanium output capacity. The firm expanded the production cut to 40% since April 2009. The firm already postponed the start of Wakamatsu plant with 1,000 tonnes of capacity from original December 2009 to April 2010.