Japanese Titanium Producers React to Boeing Disruptions

Osaka Titanium

The outlook for Japanese titanium producers in the current fiscal year (ending March 31, 2025) presents a mixed picture, primarily due to the recent labor strikes and quality control issues at Boeing. While some anticipate significant impacts on sales, others remain confident in their forecasts.

Osaka Titanium Technologies has revised its titanium business sales forecast downward by ¥3.5 billion ($22.8 million) to ¥49 billion. The company attributes this adjustment to a potential decline in titanium sponge sales stemming from the disruptions at Boeing. The seven-week strike by Boeing's machinists, which halted production of key jet programs, has raised concerns about broader impacts on the aerospace supply chain. Osaka Titanium expressed apprehension about further potential repercussions, echoing Boeing's own caution that operational stabilization will take time. Despite the lowered forecast, Osaka Titanium reported ¥26.2 billion in sales for April-September, a slight 2.8% year-on-year decrease. However, operating profit saw a substantial 59.3% increase to ¥6.3 billion.

In contrast, Toho Titanium maintains its initial sales outlook of ¥95.3 billion for the fiscal year, anticipating no significant impact from the Boeing situation. A Toho representative confirmed to Metalnomist that no order cancellations have occurred as a result of the Boeing issues. Furthermore, overseas sales volumes are secured under fixed contracts until the end of December, reinforcing the company's confidence in its forecast for the remainder of the fiscal year. Toho Titanium reported strong sales of ¥43.8 billion for April-September, a 20% increase year-on-year, with operating profit also slightly up at ¥2.4 billion.

Contrasting Strategies in a Volatile Market

The differing responses of Osaka Titanium and Toho Titanium highlight the complexities of the titanium market and its sensitivity to fluctuations in the aerospace sector. While Osaka Titanium has taken a cautious approach by revising its forecast, Toho Titanium’s existing contracts and order stability have allowed it to maintain its projections. The situation underscores the importance of supply chain resilience and diversified customer bases in mitigating risks associated with disruptions at major aerospace manufacturers like Boeing.