US Tariff Exemptions for Titanium Could Affect Aerospace Supply Chain
On April 2, 2025, US President Donald Trump announced a new set of tariffs on foreign imports, including an exemption for titanium, titanium scrap, and ferro-titanium. While this exemption helps protect titanium trade, the impact on the aerospace industry remains uncertain. Many key players in aerospace manufacturing are still assessing how the changes will affect their supply chains.
Understanding the Titanium Exemption and Its Effects
Titanium has been spared from the latest round of US tariffs, which include exemptions for various forms of titanium. However, other materials such as hafnium, molybdenum, vanadium, nickel scrap, and aluminum scrap were not granted similar exemptions. The new tariff scheme does not alter pre-existing duties on Chinese titanium products. For example, the 20% duty on titanium products from China, introduced in March 2025, will continue. Additionally, Chinese titanium sponge imports will remain subject to a 60% tariff.
Imports of unwrought titanium from Japan, Kazakhstan, and Saudi Arabia will also face a 15% tariff. Efforts are underway to remove this tariff for sponge imports, but it remains in place for now. For US titanium scrap imports, particularly from the EU and UK, the tariff exemption is vital. Without this exemption, US scrap dealers, processors, and consumers could face significant challenges due to the lack of sufficient domestic vacuum-grade titanium scrap production to meet demand.
Aerospace Industry and Supply Chain Impact
The titanium exemption provides relief for many manufacturers, but the broader impact on the aerospace industry is still unclear. Aerospace manufacturers remain uncertain about how the new tariffs will affect finished parts, components, and engines. This is especially true for cross-border production of parts like the Leap-1A and Leap-1B engines used in the A320neo and Boeing 737 Max.
Canada and Mexico, which are major players in aerospace manufacturing, have been excluded from the new US tariffs. This alleviates concerns for companies like Bombardier, Airbus, RTX, and Heroux-Devtek, which operate in these regions. Despite this, some titanium producers remain concerned that the situation may change. Defining the boundaries between parts made from titanium and those assembled with other materials like nickel-based alloys or aluminum can be complicated, adding to the uncertainty.
China’s 34% Tariff on US Exports
In retaliation for the US tariffs, China has imposed a 34% tariff on all US imports, which will affect titanium imports from the US. While China imports limited amounts of titanium from the US, it still relies on US imports for critical aerospace components. This includes parts for its C919 aircraft, which uses the CFM Leap-1C engine—a collaboration between the US and France.
As the situation evolves, the US aerospace sector must navigate these complexities to maintain its global competitiveness.
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