Japanese producer Toho Titanium has lowered its previous expectations of a recovery in titanium demand for use in the aviation industry later this year, as supply-chain adjustments stemming from operational delays at US manufacturer Boeing are taking longer than anticipated.
A rebound in titanium sponge demand for aerospace applications may fall short of Toho's initial forecast made in May, according to a company representative that spoke to Argus on 5 August. Toho anticipates demand for the metal to rise later this year, but further delays at Boeing are likely to push the timeline back, the spokesperson said.
Toho reported ¥15.3bn ($104mn) in sales for its titanium metal business during the April-June fiscal quarter, down by 4.1pc on the year. The company attributed the fall primarily to oversupply from Chinese producers in general industrial sectors, and stated that Toho's titanium sponge deliveries for use in foreign aerospace industries remained stable on the year.
Chinese firms have substantially ramped up titanium sponge exports for general industrial use over the past 1-2 years in response to sluggish demand in the Chinese domestic market, the spokesperson added.
Toho posted ¥840mn in net profit for its titanium metal business during the quarter, down sharply by 40pc from a year earlier, according to the firm. This was mostly because of the appreciation of the Japanese yen against the US dollar, according to the firm.
