SOL: China and Russia are the number 1 & 2 producers of Titanium in the world. There is very little titanium produced in the U.S. so the bulk of the U.S. needs must be imported and our major source is Russia. With the latest sanctions against Russia by the DS Congress, includes metals/mining, anyone with common sense would know we are now in self-destruction mode.
http://www.realclearworld.com/articles/2014/08/12/how_long_can_the_us_rely_on_russian_titanium.html
How Long Can the U.S. Rely on Russian Titanium?
By Daniel McGroarty
August 12, 2014
Select Language
With the U.S. ratcheting up Russian sanctions in response to Vladimir Putin's unrepentant assault on Ukraine, word comes that U.S. manufacturers Boeing and United Technologies are building up aerospace-grade titanium stocks from their key supplier in Russia. Given that Russia's VSMPO-Avisma is, as the Wall Street Journal reports, a subsidiary of Rostec, the government-owned defense conglomerate whose CEO Sergei Chemezov (in the 1980s, he and former KGB officer Vladimir Putin lived in the same apartment building in East Germany) is on the U.S. sanctions list -- stocking up on titanium parts isn't a bad idea.
After all, titanium is critical for jetliner fuselage skins like Boeing's 787 Dreamliner. Not noted in the news reports is that titanium is also must-have metal for advanced military aircraft like Boeing's F/A-18 Super Hornet. A RAND study notes that the F/A-18 -- which has just completed bombing missions against the ISIS terror group in northern Iraq -- contains "21 percent titanium in its airframe structure."
And that's just a fraction of the titanium needed for the U.S. defense industrial base, as it takes far more titanium to construct a modern fighter aircraft than is contained in the final product. Defense contractors call it the "buy-to-fly ratio": how much titanium must be bought versus how much is ultimately built into the aircraft. The titanium Material Buy Weight for a single F-35 Joint Strike Fighter is 30,000 pounds, or 15 tons.
But the statistic that says most about Boeing and United Technology's Russian titanium stockpiling is this one: The U.S. is import-dependent for 79 percent of the titanium it consumes each year.
Are there other sources for titanium if Putin decides to "counter-sanction" the U.S. and cut off exports?
China is a major global source of titanium, but it tends to consume what it produces. Then there's Ukraine, which produces titanium in Zaporizhzhya -- located between Russian-controlled Donetsk and Russian-reclaimed Crimea. U.S. and EU titanium users may want to cross Ukraine off their long-term supply list. U.S. titanium suppliers like RTI, Allegheny Technologies Inc. and TIMET may push to surge their production lines, but how quickly -- and how much -- is uncertain.
But doesn't the U.S. Defense Department maintain a metals stockpile? It does. And between 1998 and 2005, the National Defense Stockpile sold off its titanium reserve -- from 34,800 metric tons down to zero. (Where did the proceeds go? By order of the U.S. Congress, the Pentagon was instructed to implement the "sale of titanium from the National Defense Stockpile and allocate funds to the establishment of the World War II Memorial.")
With the Pentagon's cupboard bare, Boeing and United Technologies have little choice but to bulk-buy titanium parts -- as long as their Russian supplier is willing to sell.
But what happens if Vladimir Putin decides it's time to escalate the sanctions war as he refuses to deescalate in Ukraine?
The result could be a resource war we're likely to lose. Analyst Richard Aboulafia of the Teal Group warns that titanium is "a commodity product. If the U.S. or the West starts targeting commodity products that's dangerous, because Western Europe is so dependent on Russia for oil and gas."
"We might target defense products, debt markets for financial instruments, individuals, but if you're talking about commodities, that's not at all to the West's advantage."
No it's not, and here's why: According to the 2013 National Defense Stockpile Requirements Report submitted by the Pentagon to the House and Senate Armed Services Committees, of the 19 metals and minerals on the stockpile "shortfall" list, Russia supplies 10. For 5 of those 10 -- antimony, silicon carbide, bismuth, gallium and scandium -- the U.S. has zero on hand. And of those same five, the U.S. is 100 percent import-dependent for scandium, 99 percent for gallium, 91 percent for bismuth, 85 percent for antimony and 72 percent for silicon carbide.
And the United States' metals dependence isn't just on Russia. Of the 19 metals and minerals recommended for stockpiling in the 2013 National Defense Stockpile Requirements Report, China is a Top 3 provider for 17.
Will metals dependence prove to be the 21st Century's equivalent to America's oil dependence in the 20th Century? It doesn't have to be. As coauthor of American Resource Policy Network's national security risk report, we found that of the 46 metals and minerals we assessed, known U.S. resources exist for 40: "In other words, for 87 percent of the metals and minerals on our American Resources Risk Pyramid, domestic resources exist -- the development of which could lessen the United States' import dependency."
And yet with new U.S. mines taking seven to ten years on average to move through permitting and into production -- a 40 percent increase in time over the past five years -- and mine exploration spending in the U.S. dropping by half over the past 20 years, U.S. metals dependency seems destined to grow.
Until it does, companies like Boeing and United Technologies are doing what they can to avoid being caught short by a sudden Russian titanium squeeze. It's fair to ask Washington policymakers: When the next crisis highlights another metal shortage, can we count on Russia and China to supply us?
Daniel McGroarty, principal of Carmot Strategic Group, an issues management firm in Washington, D.C., served in senior positions in the White House and at the Department of Defense.
(AP Photo)
http://www.realclearworld.com/articles/2014/08/12/how_long_can_the_us_rely_on_russian_titanium.html
How Long Can the U.S. Rely on Russian Titanium?
By Daniel McGroarty
August 12, 2014
Select Language
With the U.S. ratcheting up Russian sanctions in response to Vladimir Putin's unrepentant assault on Ukraine, word comes that U.S. manufacturers Boeing and United Technologies are building up aerospace-grade titanium stocks from their key supplier in Russia. Given that Russia's VSMPO-Avisma is, as the Wall Street Journal reports, a subsidiary of Rostec, the government-owned defense conglomerate whose CEO Sergei Chemezov (in the 1980s, he and former KGB officer Vladimir Putin lived in the same apartment building in East Germany) is on the U.S. sanctions list -- stocking up on titanium parts isn't a bad idea.
After all, titanium is critical for jetliner fuselage skins like Boeing's 787 Dreamliner. Not noted in the news reports is that titanium is also must-have metal for advanced military aircraft like Boeing's F/A-18 Super Hornet. A RAND study notes that the F/A-18 -- which has just completed bombing missions against the ISIS terror group in northern Iraq -- contains "21 percent titanium in its airframe structure."
And that's just a fraction of the titanium needed for the U.S. defense industrial base, as it takes far more titanium to construct a modern fighter aircraft than is contained in the final product. Defense contractors call it the "buy-to-fly ratio": how much titanium must be bought versus how much is ultimately built into the aircraft. The titanium Material Buy Weight for a single F-35 Joint Strike Fighter is 30,000 pounds, or 15 tons.
But the statistic that says most about Boeing and United Technology's Russian titanium stockpiling is this one: The U.S. is import-dependent for 79 percent of the titanium it consumes each year.
Are there other sources for titanium if Putin decides to "counter-sanction" the U.S. and cut off exports?
China is a major global source of titanium, but it tends to consume what it produces. Then there's Ukraine, which produces titanium in Zaporizhzhya -- located between Russian-controlled Donetsk and Russian-reclaimed Crimea. U.S. and EU titanium users may want to cross Ukraine off their long-term supply list. U.S. titanium suppliers like RTI, Allegheny Technologies Inc. and TIMET may push to surge their production lines, but how quickly -- and how much -- is uncertain.
But doesn't the U.S. Defense Department maintain a metals stockpile? It does. And between 1998 and 2005, the National Defense Stockpile sold off its titanium reserve -- from 34,800 metric tons down to zero. (Where did the proceeds go? By order of the U.S. Congress, the Pentagon was instructed to implement the "sale of titanium from the National Defense Stockpile and allocate funds to the establishment of the World War II Memorial.")
With the Pentagon's cupboard bare, Boeing and United Technologies have little choice but to bulk-buy titanium parts -- as long as their Russian supplier is willing to sell.
But what happens if Vladimir Putin decides it's time to escalate the sanctions war as he refuses to deescalate in Ukraine?
The result could be a resource war we're likely to lose. Analyst Richard Aboulafia of the Teal Group warns that titanium is "a commodity product. If the U.S. or the West starts targeting commodity products that's dangerous, because Western Europe is so dependent on Russia for oil and gas."
"We might target defense products, debt markets for financial instruments, individuals, but if you're talking about commodities, that's not at all to the West's advantage."
No it's not, and here's why: According to the 2013 National Defense Stockpile Requirements Report submitted by the Pentagon to the House and Senate Armed Services Committees, of the 19 metals and minerals on the stockpile "shortfall" list, Russia supplies 10. For 5 of those 10 -- antimony, silicon carbide, bismuth, gallium and scandium -- the U.S. has zero on hand. And of those same five, the U.S. is 100 percent import-dependent for scandium, 99 percent for gallium, 91 percent for bismuth, 85 percent for antimony and 72 percent for silicon carbide.
And the United States' metals dependence isn't just on Russia. Of the 19 metals and minerals recommended for stockpiling in the 2013 National Defense Stockpile Requirements Report, China is a Top 3 provider for 17.
Will metals dependence prove to be the 21st Century's equivalent to America's oil dependence in the 20th Century? It doesn't have to be. As coauthor of American Resource Policy Network's national security risk report, we found that of the 46 metals and minerals we assessed, known U.S. resources exist for 40: "In other words, for 87 percent of the metals and minerals on our American Resources Risk Pyramid, domestic resources exist -- the development of which could lessen the United States' import dependency."
And yet with new U.S. mines taking seven to ten years on average to move through permitting and into production -- a 40 percent increase in time over the past five years -- and mine exploration spending in the U.S. dropping by half over the past 20 years, U.S. metals dependency seems destined to grow.
Until it does, companies like Boeing and United Technologies are doing what they can to avoid being caught short by a sudden Russian titanium squeeze. It's fair to ask Washington policymakers: When the next crisis highlights another metal shortage, can we count on Russia and China to supply us?
Daniel McGroarty, principal of Carmot Strategic Group, an issues management firm in Washington, D.C., served in senior positions in the White House and at the Department of Defense.
(AP Photo)
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