Ukraine-based United Mining and Chemical Company (UMCC) has been put up for auction following the identification of several assets by the State Property Fund that it intends to privatise. 

UMCC was established in 2014, incorporating two of Ukraine’s largest heavy sand operations, the Vilnohirsk Mining and Metallurgical Plant and the Irshansk Mining and Processing Plant as part of the State-owned Enterprise. The company produces significant volumes of titanium ore concentrate, with historical exports to Europe reaching a peak of almost 250kt in 2022. However, following the Russian invasion in 2022, production and supply disruptions have resulted in export volumes declining. In March 2024, the Head of the Ukrainian State Property Fund visited Japan to discuss potential investments in the titanium industry to boost domestic titanium feedstock supply chains and has now set a date for the auction in a strategic move to privatise many assets. Historically, Russia has played an important part in titanium metal production, with Russian-based titanium producer VSMPO-Avisma representing one of the largest aerospace-grade titanium producers. However, Russia has been reliant on titanium raw materials feedstocks from Ukraine for the production of its titanium metal, which has seen a significant decline due to the continued Russian-Ukraine conflict.

 Demand for titanium in the aerospace industry is set to grow by a CAGR of 42% over the next decade reaching almost 140kt of titanium. This growth is linked to the rapid recovery of the travel industry, where commercial aircraft deliveries will see large-scale growth in titanium demand. Despite the projected growth, the supply of aerospace-grade titanium has become strained, since many aircraft manufacturers are still reliant on Russian titanium. Several countries have implemented sanctions against VSMPO-Avisma and others are placing pressure on producers to find alternative titanium sources. Given the political pressure to shift the supply chain away from Russia, the sale of UMCC Titanium will place Ukraine as a strategic player in accessing and controlling a significant ore concentrate feedstock for the titanium industry.