Is an embargo on Russian titanium a good thing?
2022-04-22
The European aircraft maker Airbus has urged the West not to impose an embargo on titanium imports from Russia. Guillaume Faury, head of the airline, believes the restrictions will not have a major impact on the Russian economy but will seriously damage global aviation. Foley made the announcement at the company's annual shareholder meeting on April 12. He called a ban on imports of Russian titanium, used to make modern airliners, "unacceptable" and suggested that any sanctions be dropped. Meanwhile, Airbus has been building titanium stockpiles for years, and if the West decides to impose sanctions on Russian titanium, it won't have an impact on the company's aircraft manufacturing business in the short term, Foley said.
Titanium is virtually irreplaceable in aircraft manufacturing, where it is used to make engine screws, housings, wings, skins, pipes, fasteners and more. So far, it has not made it into the western sanctions package against Russia. Vsmpo-avisma, the world's largest titanium producer, is based in Russia.
Before the crisis, the Russian company reportedly supplied up to 35 percent of Boeing's titanium needs, 65 percent of Airbus's, and 100 percent of Embraer's. But about a month ago, Boeing announced it was suspending its purchases of metals from Russia and would instead supply them from Japan, China and Kazakhstan. In addition, the US company has sharply reduced production due to quality problems with its new flagship Boeing 737 Max, delivering just 280 commercial jets to the market last year. Airbus is much more dependent on Russian titanium. The European aerospace manufacturer also plans to increase production of its A320 passenger jet, the 737's main rival that has taken a lot of market share from Boeing in recent years. At the end of March, reports said Airbus had begun looking for alternative sources for Russian titanium in case supplies were cut off. But airbus is clearly finding it hard to find a replacement. It should also not be forgotten that Airbus joined the EU sanctions against Russia, which included a ban on Russian airlines exporting aircraft, supplying spare parts and repairing and maintaining passenger jets. Therefore, in this case, Russia is highly likely to impose an embargo on Airbus.
Asked by Lianhe Zaobao for comment, Aviation portal editor-in-chief Roman Gusarov said: "Russia has become interdependent with the world aviation industry by supplying titanium to the world's aviation giants. What's more, Russia does not export raw materials, but products that have already been stamped and roughed (airline producers fine-process them in their own factories). This is almost a whole industry chain, not just a piece of metal. But it must be understood here that the VSMpo-Avisma factory, which works for Boeing, Airbus and other airlines, is located in Sarda, a small town in the Urals. Russia still needs to stick to the fact that it is prepared to continue to supply titanium and titanium products and maintain its position in the supply chain."
Airbus, meanwhile, does have a lot of inventory. In other words, even if Russia imposes an embargo, it will not affect the production of Airbus planes for some time. This is especially true given the decline in aircraft production and demand due to the COVID-19 pandemic. And it began to decline even before the pandemic. "In the short term, there is enough titanium to meet their needs because they have reduced their production schedule," says Roman Gusarov. But what next? Airbus and Boeing, two of the world's biggest manufacturers, get half their titanium from Russia. There is no substitute for such a large quantity. It will take a lot of time to restructure the supply chain."
But it would be even more devastating for Russia if it refused to export titanium outright. Of course, this approach could create some local difficulties for the aviation industry. But in a few years, the world will organize new supply chains and invest in other countries, and Russia will be out of this cooperation for good, and it will never come back. Boeing recently said it had found alternative titanium suppliers, notably Japan and Kazakhstan. It's just that this article is talking about sponge titanium, sorry, it's just a rich ore that has to be separated from and then used to make titanium products. Where Boeing will do all this is questionable, since the entire titanium manufacturing chain is international. Even Russia is not a complete titanium producer. The ore can be mined somewhere in Africa or Latin America. This is a serious industrial chain, so it takes a lot of money to build it from scratch.
In conclusion, it would be painful for aircraft manufacturers to leave Russian titanium, but Russian titanium is not the only option. This is an unprecedented downturn in the aviation market, so some European experts believe that Airbus can take this opportunity to completely cut ties with Russian titanium. Because, the American company has done that, and if he succeeds in cutting off Russian titanium while we are still using it, we will get pressure and blackmail from the Americans. Ditching Russian titanium in a downturn might thus minimise the damage to Airbus.
The situation of Titanium in Russia can also be compared with rare earth resources in China. Decisions are hard and injuries are comprehensive, but which is more devastating, short-term harm or long-term or even permanent harm?
