By KYIV. May 8 (Interfax-Ukraine) – The absence of its own titanium industry in the United States is geopolitically more critical than ever, Andriy Brodsky, CEO and co-owner of the Ukrainian titanium company Velta, believes.
“As always, I propose a way out: Ukrainian titanium and new technologies. I am absolutely sure that titanium is the central point of contact between the two allied countries,” the Velta CEO wrote in a column on the American Stars and Stripes website.
According to him, titanium is the next battle of the Cold War, and the United States is already losing it.
The CEO says the coronavirus pandemic has taught many hard lessons about the fragility of global supply chains. Everything from masks and hand sanitizers to appliances and furniture almost simultaneously became virtually unaffordable as supply chain bottlenecks fell like dominoes around the world.
“But more than a year after Russian tanks rolled into Ukraine, displacing more than 14 million people and throwing global markets into chaos once again, the United States is no closer today to patching the dangerous fissures in defense-critical global supply chains the two crises exposed,” the top manager said.
“Unlike the COVID-19 disruption that left retail shelves empty for months, Russia’s brutal war revealed a critical minerals dependence far more damaging to the fate of the United States. The world didn’t end when we couldn’t buy toilet paper, but an inability to source titanium – a lightweight metal used in everything from missiles, spacecraft, naval vessels, automotive parts and robotics – would catastrophically break America’s national security and economy,” the CEO is convinced.
According to him, after decades of diminishing domestic production capacity, the U.S. withdrew from titanium sponge production by 2020 and now relies entirely on foreign sources. At the same time the U.S. was retreating from the market, China’s titanium sponge production capacity grew by 1,050%, according to the Department of Commerce. Russia, which had long dominated the sector, increased its output by 66%. Together, China and Russia now own 70% of the global titanium market.
Thus, the U.S. does not buy large volumes of titanium from these countries (92% of titanium sponge is imported by the U.S. from Japan), but the dominance of these two countries has effectively crushed new international competitors due to dumping or deliberate disruption of supply chains.
The reliance on Japanese titanium isn’t without geopolitical risks, as hostilities between Beijing and Tokyo remain high, and the country’s facilities are already operating at capacity. And because there’s no room to scale, U.S. consumption has no room to grow even as its needs will almost certainly expand by a factor in the next decade.
“This isn’t some trivial matter. By withdrawing from the titanium production market and failing to support more diverse supply chains, the U.S. has handed the keys to its national security and economy to its two greatest power competitors and geopolitical threats,” Brodsky said.
According to him, there are 16 critical infrastructure sectors – things like communications, financial services and agriculture – whose assets have been deemed so essential by the federal government that any blackout would have a debilitating effect on the country. Titanium supports 15 of these 16 sectors, according to a report by the Commerce Department’s Bureau of Industry and Security.
But manufacturing finished titanium metal is complicated, he said.
“The United States and Ukraine are both on that select list. Ukraine, in particular, has amassed enormous titanium mining and manufacturing experience over the last century and is at the forefront of next-generation processes to produce this critical metal quicker and greener than anyone else. The great power competitions of the next century are being waged and won on supply chain resilience. That’s why it’s essential the U.S. declare its titanium independence before it’s too late,” the CEO said.
By forging and supporting new lines of commerce between Ukraine and the U.S., the U.S. will nullify the dangerous leverage that China and Russia can exert over it and its allies by squeezing the global supply chain.
“The U.S. must insulate itself from future supply chain disruptions or even intentional economic weaponization by unlocking new sources of titanium. Anything less isn’t just irresponsible, it’s downright subversive,” Brodsky said.
