Antonina Levashenko: “Stopping titanium production in Kazakhstan will result in higher prices and supply disruptions”

Antonina Levashenko, Head of International Best Practices Analysis Department at the Gaidar Institute, stated in a commentary to Prime that a possible shutdown of titanium production at the plant would lead to a rise in world prices for metal and major disruptions in supplies.

The expert emphasized high concentration of the global titanium market and significant share of UKTMK.

“The entire global market for titanium products (e.g. alloys or titanium sponge) is focused around a few supplier companies; a quarter of the product market is provided by Russia, another quarter by Japanese companies, while the market share of Kazakhstan’s UKTMK, as the company claims, accounts for 11% of the global market.

In this regard, the demand of large companies (e.g. aircraft manufacturers, where titanium is used in structural components of airplanes) is usually stable, and they are limited in purchasing products from several suppliers. According to Shanghai Metals Market exchange, high demand for titanium and shortage of supply in the market has determined the trend to establish firm quotations, i.e. fixed and guaranteed prices for titanium.

Thus, the loss of any major player in this market (for example, in case of disruptions in UKTMK’s production) will, firstly, cause a rise in the global metal price (as, for example, the reduced titanium supplies to Europe in 2023 resulted in a 1.9% price hike in this region). Secondly, it will force UKTMK’s partner companies (such as Boeing, Airbus, General Electric and others) to build new titanium supply chains. Individual titanium buyers (like Boeing, Rolls-Royce, Airbus) in 2022, amid sanctions policy against Russia, announced termination/reduction of titanium supplies from Russia. Assuming prolonged disruptions in the operation of UKTMK, this means structural losses of two main channels of titanium products supply for the companies.

Building new titanium supply channels (like the 2025 Airbus deal with Saudi Arabia) or in alternative titanium supplier markets (e.g., from China) will require a long time, and there may be issues related to product quality/acquisition of counterfeit parts from new suppliers (e.g., the U. S. Federal Aviation Administration ordered an inspection of nearly 500 Boeing 787 aircraft in 2025 that contained defective titanium parts from Italian suppliers).

Any such disruptions in production can be critical for aviation industry, hamper the commissioning of new airplanes, incur losses to airlines, which is not good given the growth of air passenger traffic by 8% by April 2025, according to IATA,” Antonina Levashenko said.