Titanium Scrap Price Surges in Japan

Titanium scrap market price surges in Japan when major rolled titanium makers try to secure scrap before Toho Titanium will start large electron beam furnace in 2008. The price gap with annual contract price of sponge titanium is getting wider. Toho Titanium will start the new large electron beam furnace in Yawata works of Nippon Steel in April 2008. Toho Titanium plans to produce annual 7,000 tonnes at first at the furnace with 10,000 tonnes of output capacity. Small electron beam furnace, which can use titanium scrap, is in the Chigasaki plant. However the furnace can use only scrap with less than 10 centimeters width and costs higher for processing before input. With the higher processing cost, most of titanium scrap is exported to offshore ferroalloy makers despite of the high purity as B grade metal for steel making. The new electron beam furnace can use up to 40 centimeters width. With the lower preprocessing cost, many of titanium scrap can be used to make rolled titanium products. The industry interests expect the furnace could reduce cost and expand the demand by establishing recycling material flow. However, the planed 7,000 tonnes of output is much more than domestic generation of titanium scrap. Toho Titanium expects the higher rolled titanium output makes higher scrap generation. But many in the industry expect the scrap shortage. Toho Titanium asks rolled titanium makers, which the firm provides titanium ingot for, to secure return scrap from the buyers to prevent scrap from being exported.