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Thursday November 17, 2022, 19:55:52

Titanium: Pricing Strength And The Risk Of Alloy Substitution

By Chris D. Olin

Titanium prices are expected to trend higher over the next few months as the global producers account for rising input costs (e.g., surcharge escalators) and leverage created by extended lead times. Today, we increased the benchmark pricing assumptions for CY23 which aligns with data collected from the channel and updated sponge cost outlook. The companies levered to the titanium market should eventually benefit from increased product pricing, reset contracts, favorable mix shift, increased shipments, ultimately leading to strong results next year. However, price elasticity may become a topic that emerges at some point this up-cycle, punctuated by reports of commercial aircraft redesigns. Continue reading

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Tuesday October 4, 2022, 14:19:14

Aerospace: What Comes Down, Must Go Way Up Later? Updated Macro Outlook

By Chris D. Olin

We tried to account for the newly identified industry data points and unusual crosscurrent of positive/negative comments provided by aerospace bellwether company executives and high-level industry contacts. Bottomline, we see incremental downside to near-term market expectations on headwinds associated with commercial aircraft delivery delays, supply chain instability/bottlenecks, and shortage of jet engines. Yet, longer-term market confidence seems to be building and the corporate outlooks are moving in the opposite direction, providing support to peak aerospace market bullishness. This update: (1) provides readers a summary of changes made to the macromodel and reviews the main drivers behind the revised five-year aircraft delivery/production outlook for Boeing and Airbus; (2) alert readers to details embedded within production schedules recently issued by OEMs and General Electric (GE), with emphasis placed on the Dreamliner recovery strategy; and (3) concludes with highlights taken from a unique aero supplier survey that focused on contact opinions pertaining to current OEM believability and supply chain readiness. Continue reading

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Wednesday September 7, 2022, 21:08:45

Specialty Materials: The PCC-SPMC Restructuring Effort Is Creating Quite A Nickel-Alloy Mess

By Chris D. Olin

We are hearing a lot of noise in the nickel-based alloys channel. Over the past few weeks, industry contacts: expressed new concerns about premium alloy supply shortages; have become even more frustrated with the domestic suppliers, notably PCP; and told us to brace for a crazy period of industry headlines and M&A. Our focus shifted to new PCP insights and confirmation of internal restructuring efforts. Continue reading

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Thursday August 18, 2022, 07:46:33

Specialty Materials: Filling In The Research Holes; Channel Focus On Titanium Supply Holes

By Chris D. Olin

You bet your afterburners the Tier4 Research team skipped a week of vacation for more time to explore the specialty materials channel and analyze unexpected data points. Our objective was filling holes left from last week, confirming contact expectations, and achieving a better understanding of possible supply scenarios or reason(s) behind a possible merger. We came away from a several contact discussions more convinced that changes are imminent within the titanium industry that should lead to a restart of idled upstream capacity located in the US. Now, we wait for the release of potential headlines (or game changing events)… Continue reading

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