UK ferro-titanium production operator TiVac Alloys has shut down production and scrap processing in Sheffield, and entered voluntary liquidation.
The company entered liquidation on Monday because its cost position in the UK was no longer tenable owing to high electricity costs and a fall in ferro-titanium prices to levels that yielded limited or negative margins. Ferro-titanium prices have been under sustained pressure for over a year, with prices now approaching a five-year low.
Production and scrap processing has ceased, and company buildings, equipment, assets and land will be sold as part of dissolving the company.
TiVac operated two sites in Sheffield — Oakes Green and Blackburn Road — where it processed titanium scrap, from which it produced and crushed ferro-titanium. TiVac had a nameplate capacity up to 1,500 t/month, but has run at 500-600 t/month in the past year because of weak market conditions.
TiVac operated the sites as part of a conversion agreement with Belgian trading company Metraco subsidiary FE Mottram, Metals and Alloys International, which was recently acquired by Mottram, and Westbrook Light Alloys.
Metraco will now focus on its own ferro-titanium production facility — Ti Q in Ahtme, Estonia. The Estonian plant has a nameplate capacity of 600 t/month, but this can be increased if its second furnace is utilised, Metraco director Olivier Esquenet told Argus.
Metraco will fulfil its long-term commitments for specific UK production contracts from inventories and will gradually switch over to its Estonian plant for future deliveries, Esquenet said.
Westbrook's long-term contract customers will not be affected because it can serve its commitments from inventory, director Andrew Sharp told Argus. Westbrook is assessing next steps for its business options.
The near-term effect on ferro-titanium prices in Europe is expected to be limited because contracted volumes are covered by inventory or alternative production, and new spot demand from steel mills is low. The resulting gap in total European and UK output can be covered by idled capacity at other producers.
The closure leaves Sheffield-based Transition Metals as the sole ferro-titanium producer in the UK. TiVac's exit leaves a gap in UK scrap demand, which could put downward pressure on domestic UK scrap prices if dealers are reluctant to export to the EU because of additional logistics.
