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Analysis of the development trend of titanium material industry in the second half year

The demand for aerospace titanium drives the demand for high-end titanium, and the demand structure of titanium continues to be optimized

Performance review: Profit growth far exceeds revenue growth

Statistics of 3 key listed companies of high-end titanium materials: in 2020, the total operating revenue was 8.480 billion yuan, with a year-on-year growth of 11.0%; The total net profit of the mother is 813 million yuan, up 76.8% year on year; The total net profit of the deduction is 656 million yuan, up 83.4% year on year. In the first quarter of 2021, the operating revenue was 2.209 billion yuan, up 32.1% year on year; Total net profit of RMB 255 million, up 321.4% year on year; The total net profit of the deduction is 233 million yuan, up 397.8% year on year. Earnings growth in both 2020 and the first quarter of 2021 far outpaced revenue growth in the same period.


The valuation of the three key listed companies of high-end titanium materials: as of June 11, 2021, the average value of PE (TTM) is 54 times, the median value is 52 times; PE (2021) is 46 times and 45 times.

Introduction of high-end titanium materials

Titanium has a high melting point, the proportion of small, high specific strength, good toughness, fatigue resistance, corrosion resistance, low thermal conductivity, high and low temperature tolerance can be good, under the condition of thermal shock stress characteristics such as small, its commercial value in the 1950 s began to be recognized, titanium and iron and aluminum molybdenum, vanadium, or other elements such as lead to produce high strength light alloy, It is used in aviation, aerospace, military and other high-tech fields. Along with the continuously to titanium chemical, petroleum, electric power, desalination, construction, agricultural food, medicine, daily necessities and other industries to promote, titanium is becoming more and more attention by people, has been hailed as a "third metal", "metal" space, "Marine metal" and "universal metal", because of its important strategic materials is indispensable to improve the level of defense equipment, Also known as "modern metals" and "strategic metals".


Titanium alloys can be classified:

According to the structure and composition, titanium alloys can be divided into α titanium alloy, β titanium alloy and α+β titanium alloy. In China, the prefix TA, TB, TC of the metal material marks respectively represent α, β and α+β titanium alloys.

According to the physical form and state, titanium alloy can be divided into plate, strip, bar, pipe, wire (wire) material, profile, casting and forgings.

The production process of titanium material is mainly to melt and cast the sponge titanium first, to make titanium ingot, and then to forge, extrude, tie or stretch the titanium ingot, to get titanium or titanium alloy bar, pipe, plate, cake, ring and other products for downstream use. Titanium material yield is low, the processing process produces a large number of scrap residue, resulting in high production cost. At present, China needs about 1.7 tons of sponge titanium raw materials for 1 ton of titanium.

The production of titanium processing materials is mainly concentrated in China, the United States, Russia, Japan and other countries. In 2010, China surpassed the United States to become the worlds largest producer of titanium materials, but most of Chinas titanium materials are used in the industrial field, the technical content is relatively low, while the United States is mainly aviation titanium and other high-end titanium materials. In 2018, Chinas titanium production reached 63,400 tons, up 14.42% year on year.

Second, the demand for aerospace titanium materials has grown rapidly, and the proportion of high-end titanium materials consumption has significantly increased

In recent years, Chinas demand for aerospace titanium materials has maintained rapid growth. According to data from China Non-ferrous Metals Industry Association, the consumption of aerospace titanium materials from 2015 to 2018 was 6,862 tons, 8,519 tons, 8,986 tons and 10,295 tons respectively, with year-on-year growth of 41%, 24%, 5% and 14.6%. This is closely related to the rapid development of Chinas aerospace, y-20 mass production, taihang engine stable mass production. In 2018, Chinas chemical titanium material consumption was 26,100 tons. With the rapid growth of Chinas aerospace titanium material consumption, it is expected to exceed the chemical industry titanium material consumption in the future.

The consumption of three high-end titanium materials (aerospace, shipbuilding and Marine engineering) has significantly increased.

In 2011, Chinas consumption of high-end titanium alloys (aerospace, shipbuilding and Marine engineering) was 6,143 tons, accounting for 13.8% of Chinas total consumption of titanium alloys. In 2018, China consumed 14,029 tons of high-end titanium alloys (aerospace, shipbuilding and Marine engineering), accounting for 24.4 percent of Chinas total titanium alloy consumption.


At present, Chinas autonomous civil aircraft pedigree construction is taking shape:

Regional jets Xinzhou Series (MA60, MA600, MA700) and turbofan regional jet ARJ21; The mainline C919 is about to enter mass production, and the long-range wide-body CR929 is also under development.

The market estimates that C919 fuselage titanium use accounts for 9.3 percent of the weight, and it is estimated that each C919 fuselage titanium use about 4 tons.

Military aircraft:

The proportion of titanium alloy materials used in military aircraft is increasing in recent years because it can effectively improve the thrust-weight ratio and the efficiency of the body mechanism in the manufacture of aircraft engines and bodies. The use of titanium alloy structural parts of the third-generation combat aircraft F-16 is about 3%, and the use of F/ A18-ELF and Su-27 has reached more than 15%. The titanium alloy structure of f-22, the fourth-generation combat aircraft, accounts for 41% of the total weight of the fuselage structure, and the titanium content of ITS F119 engine is 39%. The SR-71s body is made almost entirely of titanium alloy.

There are many titanium enterprises in China, the competition of low-end products is very fierce, and the production of high-end products is more concentrated. The production of high-end titanium materials is concentrated in baoti Shares, northwest Research Institute of Nonferrous Metals and a few other enterprises. Baoti Shares and Northwest Institute of Nonferrous Metals are the key research and production institutions of titanium and other rare metals since the founding of the Peoples Republic of China, playing an important role in the titanium material supply system. Baoti Group and Northwest Nonferrous Research Institute Group have always been the main suppliers of titanium for military use in China, sharing the high-end titanium material market.