Entering the "14th Five-Year Plan", the accelerated construction of China's leading equipment, the rapid installation of new types of military aircraft, and the "order-of-magnitude" incremental construction of missiles have formed a strong demand for upstream materials.
Combined with the independent controllable increment and the increase in the proportion of high-end high-performance materials in new types of equipment, the current military industry chain, upstream materials show a relatively strong "short supply", and also show higher performance increase elasticity than the downstream.
Industry background
One generation of materials, one generation of equipment
Military materials are the material basis for the development of first-class equipment. Military materials are developing in the direction of "lightweight, high-performance, multi-functional, composite, low-cost and intelligent". During the "14th Five-Year Plan" period of titanium alloys, superalloys and carbon fibers, the market demand is expected to maintain stable and rapid growth, and the market space will gradually open up.
It is expected that the compound growth rate of market demand for high-end titanium alloy, carbon fiber and superalloy materials during the "14th Five-Year Plan" period is % and 16% respectively, assuming that the three are 350,000 tons, 150,000 tons and 300,000 tons respectivelyBy 2025, the market size of the three materials will exceed 10 billion yuan, 20 billion yuan and 30 billion yuan respectively.
The industrial chain of military materials has been initially improved
Titanium
Material characteristics: excellent performance, wide range of military applications
Titanium (Ti) is located in the periodic table B group, is a silvery-white metal, titanium alloy is based on titanium plus aluminum, tin, vanadium, molybdenum, niobium and other elements of the alloy, due to its excellent physical properties, is widely used in aerospace, shipbuilding, marine engineering, weapons, automobiles, medical, chemical, metallurgy, sports and leisure and other high-end industrial manufacturing, has the "third metal", "air metal", "marine metal" and other reputation.
Industrial chain: The chain is long and complex
Titanium reserves are abundant on the earth, and the abundance of the earth's crust is 061%。In the titanium industry chain, the raw materials for industrial applications are mainly ilmenite and rutile, and the intermediate processing products are titanium sponge and titanium dioxide, among which, titanium sponge is used to manufacture titanium materials, which are used in aerospace, ships and weapons and other military fieldsTiO₂ is mainly used in industries such as coatings, plastics, and papermaking. Due to the complexity and difficulty of titanium smelting technology, only four countries, the United States, Russia, Japan and China, have mastered the complete titanium industrial production technology.
Industrial chain: upstream raw materials
Rutile is a high-quality raw material for titanium products, but it has less natural reserves. In terms of reserves, according to the USGS, the global ilmenite reserves in 2021 will be 7000000000000000000000000000000000000000004.9 billion tons. The TiO2 content of rutile concentrate is generally more than 93%-95%, with high grade and low impurity content, so rutile is a high-quality raw material for the preparation of titanium dioxide, titanium sponge, titanium tetrachloride and other titanium products.
In terms of countries, the distribution of titanium ore is concentrated, and although there are many reserves in China, there are few high-quality ores. The global rutile is mainly concentrated in Australia, India and South Africa, of which Australia ranks first, with reserves of 31 million tons, accounting for 63%;The global ilmenite is mainly concentrated in China, Australia and India, of which China ranks first, with reserves of 230 million tons, accounting for 33%. Although China's titanium resources are abundant, ilmenite is the main one, with low TiO2 content and high calcium and magnesium impurity content, which makes it difficult to beneficiate and metallurgize.
Industrial chain: the structural imbalance between supply and demand of titanium sponge in the midstream
The basic raw material of high-end titanium is mainly grade 0 titanium sponge. The basic raw material of titanium is titanium sponge, according to the national unified implementation standard of titanium sponge, titanium sponge can be divided into grade 0a, grade 0, grade 1, grade 2, grade 3, grade 4, grade 5, mainly related to chemical composition and Brinell hardness, high-end titanium alloy production raw materials to grade 0 titanium sponge, civil titanium alloy production raw materials to grade 1 titanium sponge.
There is an overcapacity of titanium sponge in the world, and the production capacity of high-end titanium sponge in China is insufficient. At present, only eight countries, the United States, Russia, China, Japan, Ukraine, Kazakhstan, Saudi Arabia and India, have titanium sponge production capacity. According to USGS, the global titanium sponge production capacity in 2021 will be 350,000 tons, but the capacity utilization rate will only be 600%, of which China's production capacity is about 1770,000 tons, with a capacity utilization rate of 678%。China's titanium sponge market is generally sufficient, but there is a large gap in high-quality and small-grain titanium sponge.
At present, the growth rate of China's high-quality titanium sponge production cannot meet the explosive growth of downstream demand, and the gap between supply and demand is increasing year by year, mainly through imports from Ukraine and Kazakhstan.
Industrial chain: the downstream high-end titanium production capacity is insufficient (difficult to cast).
Porous titanium sponge needs to be cast into dense titanium ingots before it can be used to make titanium, titanium is chemically reactive, and casting must be carried out in a vacuum or inert atmosphere. At present, there are two mainstream casting processes in the world: vacuum self-consumable arc melting (VAR) and cold bed furnace melting (CHM).
At present, the most widely used in China is the VAR method (Western Superconductor adopts this technology), which has the advantage of mature process and fast melting speed, and the disadvantage is easy segregation, poor composition uniformity and easy defects, so for titanium alloy ingots with high quality requirements, they generally go through three VAR smelting to reduce defects. In recent years, some titanium enterprises in China have introduced electron beam cold hearth bed melting furnaces and plasma cold hearth bed melting and casting furnaces from the United States and Germany, and the CHM method is also developing rapidly.
Industrial chain: the downstream high-end titanium production capacity is insufficient (difficult to process).
Titanium alloy processing technology is difficult. The thermal conductivity and specific heat of titanium alloy are small, and the heat generated during processing is difficult to release through the workpiece, and the local temperature rises quickly, and at high temperature, on the one hand, it causes sharp wear of the tool, and on the other hand, it will destroy the surface integrity of the part, resulting in the decline of the geometric accuracy of the part and the phenomenon of work hardening. Therefore, titanium alloy processing is very difficult, and at present, only 6 countries in the world, including the United States, Russia, Japan, China, Ukraine and Kazakhstan, have mastered the complete titanium processing and manufacturing process. High-end titanium materials are concentrated abroad, and China's output is large but mainly low-end. High-end titanium suppliers are mainly concentrated in Russia, the United States and Japan.
Aviation field: measure the advanced level of aircraft
Because titanium alloy has the characteristics of low density, high specific strength, good corrosion resistance and low thermal conductivity, it is widely used in aircraft structural parts and engines.
At present, the maximum speed of the new generation of aircraft is more than 3 times the speed of sound, which will cause the aircraft to rub against the air and produce a lot of heat, generally when the speed of sound is less than 2 times, the body can use aluminum alloy, when the flight speed reaches more than 2 times, it is necessary to use titanium alloy with high temperature resistance and better performance, when the flight speed exceeds 3 times the speed of sound, the fuselage will use more titanium alloy.
Aerospace sector: major engineering and missile reserves
Titanium alloy material replaces traditional steel materials, which can greatly reduce the structural weight of aerospace vehicles and improve the corrosion damage resistance of aerospace vehicle structures, which is of great significance for increasing the range of aerospace vehicles, reducing fuel consumption, prolonging service life and improving service reliability.
**Field: Born to fit
Due to its high specific strength and excellent corrosion resistance in seawater and marine atmosphere, titanium alloy has also been widely used in the field of ships. It is mainly used in pressure-resistant hulls, structural parts, buoyancy system spheres, pump bodies, pipes and deck fittings of water vessels, speedboat thrusters, propulsion shafts, hydrofoils, whip antennas, etc. At present, the application of titanium alloy in ships is mainly concentrated in some key parts, but with the continuous maturity of the titanium alloy industry and the reduction of costs, the proportion of titanium alloy applications in ships will continue to increase in the future.
Market size: There is a lot of room for growth in high-end titanium, and the market size is expected to reach 10 billion
China's consumption is dominated by chemicals, and the space for high-end titanium materials is broad. China's titanium consumption in 2021 is 1270,000 tons, a year-on-year increase of 357%, the amount of titanium used increased rapidly.
Compared with the demand structure of titanium, China is dominated by the chemical industry, while the largest demand for titanium in the world is in the aerospace field, reflecting the low use of high-end titanium in China, and the incremental space for high-end titanium materials such as aerospace in the future is still broad.
It is estimated that the total demand for titanium alloys for China's first-class aircraft from 2022 to 2026 will be 27,234 tons, with an annual average of 5,447 tons. The total demand for titanium alloys for civil aircraft is 197097 tons, with an annual average of 39,419 tons. According to the calculation of 350,000 tons of high-end titanium, the annual market size of military aircraft and engines is about 2 billion, and the average annual market size of military aircraft and engines is about 10 billion.
Competitive landscape: "department stores" and "specialty stores".
Military high-end titanium alloy does not compete directly with foreign countries, but there is still a certain gap: such as titanium alloy extrusion profiles, die forgings, large titanium alloy wide and heavy plates, large titanium alloy castings, titanium alloy rods and wires for aviation fasteners, etc., it is urgent for China's titanium industry to improve product quality to fully meet the development needs of national defense and military industry for titanium alloys.
From the current point of view,Due to the existence of historical status, Bao Titanium is the longest, largest and most complete titanium alloy manufacturer in industrialization, which can be regarded as the "department store" of titanium alloy. The two actual controllers of Western Materials and Western Superconductor are both Northwest Nonferrous Metals Research Institute, so there are restrictions on competition in the same industry, resulting in Western Materials mainly titanium alloy plates and pipes, and Western Superconductor is mainly titanium alloy rods and wires. The two companies have strong competitiveness in their own fields, and can be regarded as a "specialty store" of a certain type of titanium alloy.
Superalloys
Material properties: Good properties at high temperatures
Superalloy is a kind of advanced structural material with nickel, iron and cobalt as the matrix, which can withstand a certain stress for a long time at a high temperature of more than 600 meters, and has excellent oxidation and corrosion resistance. Compared with ordinary metals, superalloys have excellent performance in complex working environments: high temperature strength;Antioxidant properties;Resistant to thermal corrosion;Fatigue resistance;Fracture toughness;The internal organization is stable and reliable to use. Although the performance is excellent, the preparation of superalloys is difficult, and Europe and the United States also call them super alloys.
Industrial chain: A basically complete industrial chain has been formed
At present, there are more than 10 enterprises and research institutes engaged in the research and development and preparation of superalloys in China, and a relatively complete superalloy production system has been formed. The superalloy industry chain is composed of upstream raw materials and equipment manufacturers, midstream superalloy materials and products manufacturers, and downstream application terminals.
Aerospace: the largest field of application
At present, superalloys are mainly used in the field of engines, including aero engines, space rocket engines and various industrial gas turbine engines. According to Roskill statistics, in the downstream applications of superalloys, in terms of value, the aerospace field accounts for 55%, followed by the power field, which accounts for 20%.
Superalloy is an important material for aero engines and is the performance guarantee of many core components. According to the "Development of Aero Engine Material Structure", in the new aero engine, the amount of superalloy accounts for more than 40% of the total weight of the engine, which is mainly used for hot end components such as combustion chambers, turbine guide vanes (also known as guides), turbine working blades, turbine discs, etc., in addition to casings, rings, tail nozzles and other components.
Ship**: Concentrated application in the power plant of the ship
The application of superalloys in marine engineering is also mainly concentrated in the structural parts of power units and a large number of high-temperature bolts used in power units. The power equipment of ships in various countries around the world is divided into main power (mainly large diesel engines or nuclear reactors) and auxiliary power (mainly gas turbines), both of which require the use of a large number of superalloys.
Diesel engines have the advantages of high thermal efficiency and wide power range, and occupy a large share in ship power units, and superalloys are mainly used in pre-combustion chamber nozzles, high-temperature corrosion-resistant elastic parts and fasteners, gas valves and valve seat alloys, booster turbines, superchargers and exhaust systems of large diesel engines. The parts of gas turbines that require the use of superalloys include air compressors, combustion chambers, impeller systems and gear reducers. The temperature of the gas injected into the impeller is as high as 1300 °C, so the impeller system needs to be made of superalloys.
Market size: The annual market size is more than 10 billion
The supply of domestic superalloy production capacity is limited, and there is a large gap between supply and demand for a long time. According to statistics, in 2019, the scale of China's superalloy gold market reached 169800 million yuan, with an output of about 2760,000 tons, but the overall market demand for superalloys is about 4820,000 tons, with a gap of 2060,000 tons. It is estimated that the annual demand for superalloys in China will be about 5 in the future820,000 tons, the market space is broad.
Competitive landscape: The world is characterized by an oligopoly
Due to the high technical difficulty, long process accumulation time, long product verification cycle, large initial investment and other threshold factors, there are only more than 50 companies in the world with the ability to produce aerospace superalloys, mainly concentrated in the United States, Britain, France, Germany and other countries, and the industry presents oligopoly characteristics.
Aluminum alloy
Low cost, high modulus: the most widely used structural material
Aluminum is the most abundant metal element in the earth's crust, and is the world's second largest non-ferrous metal in terms of production and use, second only to steel, with a density of only 27g cm, which is about 1 3 of steel. Since pure aluminum is softer and has lower strength, aluminum alloys with better performance are made by adding small amounts of elements (such as magnesium, copper, zinc, silicon, lithium, etc.) to aluminum.
Due to its excellent mechanical properties and corrosion resistance, aluminum alloy is the most widely used non-ferrous metal structural material in industry, and has been widely used in construction, aerospace, automobile, machinery manufacturing, shipbuilding and chemical industries. The aluminum alloys used in the military industry mainly include aluminum-lithium alloys, 2XXX (A1-CU-MG) series and 7XXX series aluminum alloys.
Industrial chain: develop to high-end aluminum
The upstream of the aluminum alloy industry chain is the metal ore mining and smelting industry, which is mainly composed of three links: bauxite mining, alumina refining and electrolytic aluminum production. After processing electrolytic aluminum (mainly casting and rolling), aluminum alloy castings, aluminum strips and aluminum profiles and other products are obtainedThe downstream enterprises of the industrial chain are widely used in construction, automobiles, aerospace, ships, packaging and other fields through the purchase of aluminum processing materials.
Competitive landscape: low-end homogenization, high-end dependence on imports
The equipment level of domestic aluminum processing enterprises is two-level differentiated, and the production capacity of low-end products is seriously overcapacity, but high-end aluminum still needs to rely on imports. At present, the current situation of the domestic aluminum processing industry is that there are more than 1,500 enterprises, but the scale is uneven, with a production capacity of more than 200,000 tons of about 25, and more than half of the alumina and primary aluminum output in China.
In the world, the main manufacturers of civil aviation aluminum are Alcoa, Aleris, Kaiser, Alcan, etc. There is still a large technological gap between China and foreign enterprises, especially in alloy research and development and basic theoretical research.
Jingtai investment advice
The track focuses on and specializes in a certain type of alloy as the target of domestic substitution
Because it belongs to the national basic industry, the market pattern of metal materials has been basically determined, but in the high-end market segment, there is still a blue ocean opportunity for domestic substitution benefiting from the characteristics of the military industry. However, the subdivision track should not be too small, and the entrepreneurial team needs to have a deep industrial process accumulation.
Relying on unlisted mature enterprises to do mergers and acquisitions of high-tech teams
Based on the characteristics of stable performance, strong anti-cyclical ability and good cash flow of metal material enterprises, it is also possible to integrate resources and capital operation through the acquisition of an unlisted mature enterprise and the integration of high-end industrial teams through mergers and acquisitions.