Titanium alloys have become an innovation trend in consumer electronics materials, and we are optimistic about investment opportunities in titanium processing and related consumables.

Titanium alloy has become the innovation trend of consumer electronics materials. Xiaomi released titanium alloy version of 14Pro. The improvement of titanium alloy processing technology and the decline of material cost are expected to accelerate its application in 3C field. The bank believes that with the innovation of 3D metal printing technology and material structure, as well as the application of flagship consumer electronics products such as Apple and Xiaomi, titanium alloy is expected to become an important direction of material innovation in the 3C electronics field. Titanium alloy materials are the first to be used in high-end consumer electronic products. With the decline of material cost and the formation of scale effect in mass production, titanium alloy materials are expected to continue to infiltrate in low-and middle-end consumer electronic products.

Event: on October 26th, Xiaomi held a new product launch in 2023. Xiaomi 14 Pro launched a special edition of titanium with 99% titanium medium frame. On October 12th, Glory released Glory Magic Vs2, the flagship mobile phone with light and thin inner fold, using a series of innovative materials such as Luban titanium hinge, Glory self-developed shield steel, aerospace grade rare earth magnesium alloy and so on. On Sept. 13, Apple unveiled the iPhone 15 series. The Pro version uses a new titanium body, making it the first Apple phone to use aviation-grade titanium.

Titanium alloy has remarkable performance advantages and is expected to become the innovation trend of consumer electronic materials.

Titanium alloy is based on titanium and is composed of aluminum, tin, vanadium, molybdenum, niobium and other elements. it has excellent properties such as high specific strength, strong fatigue resistance, good corrosion and heat resistance and so on. it is widely used in chemical industry, aerospace, shipbuilding, marine engineering, metallurgy, sports and leisure and other fields. The use of titanium alloy materials in the field of consumer electronics can significantly improve the structural strength of products. Under the background that folding screen mobile phones have become an industry trend, the use of titanium alloy materials for screen hinges can significantly increase the service life, and the use of titanium alloy materials will also significantly reduce the weight of consumer electronics products. IPhone 15 Pro weighs only 188g, 9.6% less than 14 Pro.

The demand for high-end titanium materials is robust, and the permeability of 3C field is expected to increase rapidly.

In 2022, global titanium ore production was about 8.673 million tons, an increase of 4.9 percent over the same period last year. China's titanium ore production reached 3.144 million tons in 2022, accounting for 36 percent of the global output, an increase of 10.05 percent over the same period last year. Since 2020, the output of sponge titanium, titanium ingots and titanium processing materials has maintained a high growth rate. The compound growth rate of China's sponge titanium production has exceeded 28 percent, and the output of titanium processing materials has increased by 27 percent over the same period. From a demand point of view, titanium dioxide is still the largest use of titanium ore, but the shrinking real estate demand suppresses the demand for coatings, with sponge titanium accounting for 8% of the demand; titanium processing materials in the use of scenarios, chemical, aerospace, pharmaceutical, power and shipping and other fields account for relatively high. From a marginal point of view, the use of chemical industry and aerospace increased significantly in 2022, by 14000 tons and 11000 tons respectively, while demand in metallurgy and electric power decreased.

The 3C field is expected to become a new demand growth point for titanium materials, and the decrease of material cost is expected to accelerate the increase of permeability.

In 2022, chemical and aerospace industries account for 73% of the demand for titanium processed materials, and the share of demand continues to increase in recent years. The share of demand in the consumer electronics sector is expected to increase significantly from 2023 to 12% in 2025. Titanium alloy has not been widely used in the field of consumer electronics because of its difficulty in processing and low yield of materials, but with the innovation of 3D metal printing technology and material structure, as well as the application of leading consumer electronics products such as Apple and Xiaomi, titanium alloy is expected to become an important direction of material innovation in 3C electronics field. Titanium alloy materials are the first to be used in high-end consumer electronic products. With the decline of material cost and the formation of scale effect in mass production, titanium alloy materials are expected to continue to infiltrate in low-and middle-end consumer electronic products.