High Temperature Alloy Application Market Analysis II

2.Application field II: gas turbine, industrial gas turbine High Temperature Alloy potential demand is broader

High-temperature alloys are widely used in gas turbine combustion chambers, conduits, guide blades, turbine working blades and turbine disks. Gas turbine is a high-power and high-performance power machine that uses air as the medium and relies on high-temperature gas to push the turbine machinery to do work continuously, which has the advantages of high thermal efficiency, low pollution, low water consumption, easy installation and so on. The core components of the gas turbine are the compressor, combustion chamber and gas turbine. The combustion chamber and gas turbine have high bearing temperatures and a large number of hot end parts. High-temperature alloys have excellent high-temperature strength, good oxidation and corrosion resistance as well as good comprehensive properties, such as creep properties, fatigue properties, fracture toughness, organizational stability, process performance, etc., which are widely used in the hot-end components of gas turbines. The performance and preparation level of high-temperature alloys determine, to a certain extent, the performance of advanced gas turbines in terms of power, efficiency and life. For example, nickel-based high-temperature alloys are usually used for combustion chambers, and the main grades are Nimonic C263, Haynes 230 and IN718.

Gas turbine gas turbine blades have relatively higher requirements for material life and corrosion resistance than aero-engine turbine blades, and the size of the blades is relatively larger. Combined with the development history of General Electric, Siemens and Mitsubishi Heavy Industries, the main materials for advanced gas turbine blades are nickel- and cobalt-based casting high-temperature alloys, with representative grades such as IN738LC, Rene 80, IN792, FSX414, Mar-M247, etc. The gas turbine turbine discs are not the same as those for gas turbines. The temperature difference between different parts of the gas turbine turbine disk is large, resulting in radial thermal stresses, which requires the material to have high tensile strength, yield strength and low fatigue strength at the working temperature. According to the characteristics of high-temperature alloys, the main materials for gas turbine turbine discs are nickel-based deformation high-temperature alloys, such as IN718, IN706 and GH4698. Since the diameter of gas turbine turbine discs is usually more than three times that of aero-engine turbine discs, large-size deformed high-temperature alloys are required, which puts high demands on the control of alloy purity and niobium elemental segregation.

Industrial gas turbine high-temperature alloy potential demand is broad, benefit from clean and environmental protection energy development. According to the report issued by GRAND VIEW RESERRCH, the global market size of gas turbine in 2020 will be about 20.38 billion U.S. dollars, and electric power and public utilities are the main application scenarios of gas turbine, with revenue contribution of more than 85%. The report also predicts that the market size of gas turbine will reach USD 35.02 billion in 2028, of which the share of power and utilities will be further expanded, partly benefiting from the global population growth and urbanization brought about by the demand for electricity, and partly benefiting from the development of environmentally friendly power generation.

3. Application area 3: nuclear power equipment, safety, reliability and high demand for high-temperature alloy traction demand

Nuclear power plants operate in harsh environments, and in order to ensure their safety and reliability, high performance requirements are placed on the materials used. A nuclear power plant consists mainly of a nuclear island and a conventional island. The principle is that cooling water is used to transfer heat from the reactor core to the steam generator, which then transfers the heat to a secondary circuit system to produce high-temperature and high-pressure steam, which in turn drives the generators to produce electricity. The structural components of a nuclear power plant are generally used in complex environments that expose them to high temperatures, high neutron doses, radiation losses, and corrosive environments. In order to ensure the safety and reliability of nuclear power plants, nuclear power structural materials must not only have good strength, excellent corrosion resistance, high fatigue and toughness, but also good resistance to irradiation embrittlement, thermal stability, chemical stability and radiation stability of the core materials.

High-temperature alloy materials have an irreplaceable role in the nuclear power field due to their excellent characteristics such as high temperature resistance and high strength resistance. The nuclear island is the core of the whole nuclear power plant, the main part of the thermonuclear reaction, responsible for converting nuclear energy into thermal energy, and is the most complex and costly part of the nuclear power plant. The core of the nuclear island is the reactor, and the important parts of the reactor include the cladding material, the reactor internal component material, the reactor pressure vessel material, the reactor circuit material, the steam generator material, the control material, and the containment material. The parts that need to use high temperature alloy are some of the reactor internals and steam generators. For example, nickel-based high temperature alloy is used for some of the reactor internals because they are facing the active zone and are subject to the effects of coolant charging, high temperature and high pressure.

China's nuclear power construction still has greater room for improvement, driving the growth of high-temperature alloy demand. According to the national bureau of statistics, in 2020, the national cumulative power generation capacity of 74170.4 billion kwh, of which the total power generation capacity of commercial nuclear power units (including online power and plant power) is 366.25 billion kwh, accounting for about 4.94% of the national total power generation capacity. 2021 January-August, China's nuclear power power generation capacity amounted to 2,698.5 billion kwh, accounting for about 5.01% of the national total power generation capacity, compared with the end of 2020 to further improve. China's nuclear power generation capacity reached 269.85 billion kWh in January-August 2021, accounting for about 5.01% of the country's total power generation capacity, a further increase from the end of 2020, but still far below the world average (10%). As of the end of August 2021, there were 51 nuclear power units in operation in China, with a total installed capacity of 53.26 million kilowatts; the number of nuclear power units under construction was 18, with an installed capacity of 19.02 million kilowatts.

(C) from the current pace of China's high-temperature alloy enterprises to put into production, looking forward to the industry boom degree of enhancement of expectations

Currently China's main high-temperature alloy enterprises have been investing in the expansion of production. China's major high-temperature alloy enterprises steel research Gaona, Tu Nan shares and Fushun Special Steel in 2019 ~ 2020 focused on the construction of production capacity expansion and research base projects, according to the project 1 ~ 3 years of construction planning, 2021 ~ 2023, this batch of concentrated expansion projects are expected to land production in the short and medium term. High-temperature alloy enterprises in the aviation engine and aircraft key structural components in the upstream link, the rhythm of capacity expansion or reflect the plate demand boom degree of enhancement is expected. We believe that the high-end equipment demand bias planning, government procurement, etc., determines the relevant enterprises, whether based on customer requirements for supply chain reliability, or to minimize the cost of capital angle, the capacity to invest in higher planned, especially in supporting the status of the core, the supply of the core equipment link or the company.

(iv) Long-term stability: diversified downstream and broad aftermarket space lay the foundation for demand stability

In the long cycle, under the characteristics of diversified downstream and aftermarket, the profit quality of high temperature alloy enterprises still has the stability in the long cycle.

1. Diversification of downstream helps reduce the negative impact of single market and single model.

The higher the position of the industry chain, the higher the degree of diversification of market layout; PCC was born in the midstream foundry, specializing in the aviation market in the early stage, and later became an integrated company in the aviation industry chain through the horizontal and vertical integration of the industry chain; while ATI was born in the upstream iron and steel mills, and was engaged in the general industry and the aviation market in the early stage; therefore, in terms of relative comparison of high-temperature alloys, PCC's core business is located in the midstream of the industry chain, and ATI's core business is located in the upper part of the industry chain. Therefore, in terms of relative comparison in the high-temperature alloy track, PCC's core business is located in the middle of the industry chain, while ATI's core business is located in the upper part of the industry chain. Due to the relative differences in the industry chain, there is a significant difference in the degree of market diversification between PCC, ATI and CRS (also from steel mills), with the revenue share of PCC's aerospace market significantly higher than that of ATI, averaging 60% for PCC's aerospace market from 2006 to 2015, compared with only 32% for ATI. In addition, in terms of customer concentration, PCC's top customer GE's contribution to revenue is consistently higher than 10%, while ATI has no single customer whose contribution to revenue exceeds 10% in any year.

High-temperature alloy-related enterprises are in the middle and upper material links of the aerospace engine industry chain, and the standardized features of their products weaken the risks of downstream model development and customers. (1) Compared with downstream OEMs, the risk of model development failure can be mitigated. Engine development is characterized by high risk, especially in the commercial aviation market, which emphasizes high safety, and RR has borne high maintenance and default costs due to the failure of the Trent1000 model in recent years. However, as PCC is a forging and casting supplier, its products have high degree of standardization and slow technology iteration, so it is difficult to transfer the risk of failure of a certain model and the yield of the initial batch production to PCC, that is, most of the forging and casting parts in the old model and the new model can achieve a degree of technical reuse, and the revenue continuity of the products is high.

(2) Compared with downstream OEMs, PCC can reduce its dependence on a single customer. In the aero-engine market, due to the oligopolistic characteristics of downstream aircraft OEM customers, most of the enterprises in the middle and lower streams have a high degree of dependence on a single model and a single customer. For example, in the civil aviation field, Boeing's structural components first-tier supplier SPR's revenue composition of the 737 MAX contributes more, so after the 737 MAX flight accidents, SPR's performance scale decline is more serious; in the military aviation field, the F-35 project as the U.S. Army's large-scale fighter aircraft program, Pratt & Whitney and GE and other engine companies actively participated in the project in the early stage of the competition. Later on, Pratt & Whitney was selected by the U.S. Department of Defense to be the exclusive contractor for the F-35 project engines, and PCC, as a supplier of structural components, can reduce the degree of dependence on a single customer.

2. Broad after-market space, laying the stability of the industry's long-term development.

The downstream application fields of high-temperature alloys mainly focus on aerospace engines and gas turbines, etc., and the business model in this field is characterized by the vastness of aftermarket space.

The harshness of the operating environment is the determining factor of the aftermarket space, which in turn determines the difference in the whole-life cash flow between the aero-engine and civil aircraft projects, and the focus of the investment in the aero-engine industry lies in the understanding and grasping of the characteristics of the whole-life cash flow of the aero-engine industry. Taking civil aviation as an example, the fundamental reason for the difference in business models between aircraft and engines is that there are big differences in their long-term operating environments. Compared to engines, civil aviation aircraft operate in a relatively favorable environment, with requirements for safety, reliability and comfort. Although the loads and frequency of flights put stress on the structure of the aircraft and some of its systems (e.g. avionics, brakes), and maintenance of its subsystems and structure is required to ensure safe operation, maintenance does not usually involve the replacement of major parts of the aircraft. When an engine is in operation, its critical components are usually immersed in high temperature, high speed, corrosive air streams, and the rotational speeds are sufficiently high to cause stress and wear on the components.

The harshness of the operating environment is the determining factor in the aftermarket space, which in turn determines the difference in investment cycle and cash flow between civil aircraft and aero-engine projects. Civilian aircraft are characterized by high R&D investments in the first 5-6 years of the project, followed by simultaneous investment in a large production facility during this period. A successful aircraft program will continue in production for 10-15 years, after which time another major investment is required to replace or upgrade the model, with a useful life of approximately 25 years. Due to the relatively low aftermarket space for civil aircraft, aircraft pricing is often based on the number of units that will be purchased by airlines during a hypothetical production run, with the hope of achieving payback in OEM wherever possible. As opposed to civil engines, which are sometimes sold at close to cost due to intense competition and strong airline purchasing power, the sale of new engines does not generate the required return on investment, but relies more on their aftermarket potential.

In terms of cash flow, taking a typical civil wide-body engine project as an example, according to RR's 2018 announcement, with 2,000 engine projects as a representative, the cash flow expenditure can be divided into three phases: (1) R&D and pre-capital expenditure cash flow of approximately GBP 1.5 to GBP 2.0 billion, which is approximately RMB 12 to RMB 16 billion; (2) cash flow of GBP 3.2 billion in the phase of new engine production and delivery, which is approximately RMB 25 billion or more (based on the current per capita cost); and (3) cash flow of GBP 3.2 billion in the phase of new engine production and delivery. More than 25 billion yuan (estimated at the current cash flow loss of 1.6 million per engine); (3) aftermarket stage lasts more than 25 years, the cumulative cash flow is expected to be more than 10 billion pounds, or more than 80 billion yuan.

Hot end components made of high-temperature alloys and other materials constitute the main repair and replacement market for aero-engines.

Aero-engine failures are dominated by fatigue damage to components. Aero-gas turbine engines, for example, engine components include (1) intake, (2) pressurizer, (3) combustion chamber, (4) turbine, (5) exhaust components, (6) accessory drive gearbox, (7) pneumatic, sliding oil, fuel system, anti-icing, cooling and pressurization and other auxiliary systems, seven major parts. Usually, according to the different temperatures of the air flow through the gas turbine engine is divided into two major parts: the cold section (including the inlet and the two major components of the pressurizer) and the hot section (including the combustion chamber, the turbine and the tailpipe three major components). Fatigue damage failure of components accounts for nearly 60% of total engine failures. Due to the complex structure of the aero-engine and the large number of parts, its failure mode is relatively complicated, and the failure can be roughly categorized into performance failure, structural failure, and accessory system failure.

Aero-engine maintenance can be categorized into route maintenance, periodic overhaul and overhaul according to its content. Among them, the return overhaul involves the disassembly of the engine and the replacement or repair of rotor parts such as shafts and disks, which mainly includes two major parts, namely, performance restoration and replacement of time-life parts. After a long period of operation, the condition of the engine will deteriorate, and then it needs to be repaired. Theoretically speaking, after returning to the factory for overhaul, the engine will be able to fully restore its original reliability, and will be able to continue to carry out the tasks of another overhaul cycle.

(1) Performance Recovery: Damage to parts caused by high temperature, corrosion and fatigue will eventually cause the core engine's performance to deteriorate. As the engine's service time increases, the EGT (exhaust gas temperature) gradually rises, while the wear and fatigue of components gradually increase, further accelerating the engine's performance degradation. Considering the material and performance of the components, OEMs (Original Equipment Manufacturers) will set an upper limit for EGT, and once it is reached, they will require the engine to be operated within the EGT limit.

Business model: process iteration pulls oligopoly pattern, capital expenditure strengthens barriers

(I) Competition pattern: globally, the oligopoly pattern is obvious, and the long-term cycle is solid and strong.

1. Globally, the competitive concentration of high temperature alloy in the upstream is lower than that in the downstream, and the revenue gap between major high temperature alloy enterprises in the United States is relatively small.

The downstream market of high-temperature alloy industry chain is highly concentrated. The downstream engine market of the high-temperature alloy industry chain presents an obvious oligopoly situation, while the engine market is concentrated in four companies, namely, SAFRAN of France, GE of the United States, P&W of the United States and R-R of the United Kingdom. As for the aircraft market, among the annual deliveries of new aircraft in the world, the combined deliveries of Boeing and Airbus from 2010 to 2020 account for 90% of the global deliveries on average per year, and the two have monopolized over 85% of the global market share for a long period of time. As for the engine market, in 2020, the global civil engine market will mainly focus on GE, P&W and SAFRAN. In 2020, GE will account for 6% of the global engine deliveries + orders in hand, P&W will account for 17%, and CFM, a half-funded subsidiary set up by GE and SAFRAN, will account for 52%, which means that the combined market share of GE, P&W and SAFRAN will reach 75%. That is, GE, P&W and SAFRAN combined market share of 75%, plus R-R nearly 8% of the market share, the four global market share of 82%.

The concentration of high temperature alloy market is relatively decentralized downstream, and the difference in the revenue scale of high temperature alloys of major U.S. enterprises is not obvious. The global high-temperature alloys market is represented by HAYN (Haynes International), CRS (Carpenter Technology Corporation), ATI (ALLEGHENY TELEDYNE INC), and Special metals (a subsidiary of PCC).

As opposed to civil engines, which are sometimes sold at close to cost due to intense competition and strong airline purchasing power, the sale of new engines does not generate the required return on investment, but relies more on their aftermarket potential. In terms of cash flow, taking a typical civil wide-body engine project as an example, according to RR's 2018 announcement, with 2,000 engine projects as a representative, the cash flow expenditure can be divided into three phases: (1) R&D and pre-capital expenditure cash flow of approximately GBP 1.5 to GBP 2.0 billion, which is approximately RMB 12 to RMB 16 billion; (2) cash flow of GBP 3.2 billion in the phase of new engine production and delivery, which is approximately RMB 25 billion or more (based on the current per capita cost); and (3) cash flow of GBP 3.2 billion in the phase of new engine production and delivery. More than 25 billion yuan (estimated at the current cash flow loss of 1.6 million per engine); (3) aftermarket stage lasts more than 25 years, the cumulative cash flow is expected to be more than 10 billion pounds, or more than 80 billion yuan. Hot end components made of high-temperature alloys and other materials constitute the main repair and replacement market for aero-engines.

Aero-engine failures are dominated by fatigue damage to components. Aero-gas turbine engines, for example, engine components include (1) intake, (2) pressurizer, (3) combustion chamber, (4) turbine, (5) exhaust components, (6) accessory drive gearbox, (7) pneumatic, sliding oil, fuel system, anti-icing, cooling and pressurization and other auxiliary systems, seven major parts. Usually, according to the different temperatures of the air flow through the gas turbine engine is divided into two major parts: the cold section (including the inlet and the two major components of the pressurizer) and the hot section (including the combustion chamber, the turbine and the tailpipe three major components). Fatigue damage failure of components accounts for nearly 60% of total engine failures. Due to the complex structure of the aero-engine and the large number of parts, its failure mode is relatively complicated, and the failure can be roughly categorized into performance failure, structural failure, and accessory system failure.

2. China to see, special steel system background enterprise capacity and scale advantage is prominent, state-owned enterprises and private enterprises scale gap is more obvious

At present, China's high-temperature alloy production capacity of enterprises are mainly special steel enterprises, research institutes and a few private enterprises. One category is special steel enterprises, at present, Fushun Special Steel, Baosteel Special Steel, Great Wall Special Steel, CITIC Special Steel and so on have high temperature alloy production capacity and production, with deformed high temperature alloy as the main product, relying on the advantages of complete production equipment and large-scale melting capacity, to produce batch size, simple alloy plate, forgings, etc. The other category is enterprises in transition of research institutes, including enterprises in transition of research institutes, which have outstanding advantages in production capacity and scale. Another category is the transformation of research institutes, including the General Research Institute of Steel (Steel Research Institute), Beijing Institute of Aeronautical Materials, Institute of Metals of the Chinese Academy of Sciences (Zhongke Sannei), etc. The research strength of scientific research institutes is relatively strong, and they mainly produce smaller batches of high-end products with complex structures, mainly supplying the demand of high-end fields such as aerospace and shipbuilding. The other category is a private background of enterprises, such as Tunan shares, western superconductor, Lunda shares, AVIC on the big, Zhongzhou special materials, Sichuan Liuhe and so on.

Revenue end, special steel enterprises and research institutes transformed enterprise scale leading, of which the special steel enterprises production capacity advantage is outstanding, and the current use of large deformation of high-temperature alloy field; research institutes transformed enterprise such as steel research Gao Na, process breadth and revenue scale than other enterprises, and through the merger and acquisition of high-temperature alloy enterprises in the field of civil, to achieve the rapid increase in the scale of the enterprise. Research and production system and technical barriers and other reasons, China's private enterprises into the high temperature alloy industry is relatively late, while in the field of high-end equipment, focusing on a few process routes, the scale gap with the special steel system and research institutes transformed enterprise is still a big gap.

(ii) Why towards multiple oligopoly: downstream requirements for high reliability for lower technology iteration rate

1. The complex and harsh environment of downstream applications, long development time and high reliability requirements have led to lower technology iteration of upstream high-temperature alloy materials. According to Aero Gas Turbine Engine Working Principles and Performance (2nd edition, Zhu Zhili et al., 2019, Shanghai Jiao Tong University Press), aero engines are characterized by extremely harsh working conditions and very high usage requirements. Aero-engine is working under the conditions of high temperature, high pressure, high rotational speed, especially the rapid acceleration and deceleration transients, which cause high and low circumferential alternation of stress and thermal load. To high temperature, for example, the current advanced engine turbine gas temperature up to 1800 ~ 2000K, while the modern three-generation single-crystal high-temperature alloys with a maximum temperature of 1367K (1 ℃ = 1K273.15), up to 600 ℃ temperature gap can only be solved by the blade cooling technology and thermal insulation coating technology. High Difficulty, high requirements for reliability and the main hot end parts of the dependence on the performance of high-temperature alloys, pulling upstream high-temperature alloy materials compared to the downstream engine slower technology iteration cycle, laying the pattern of oligopoly in the industry.

The development iteration of different processes of high-temperature alloys has a relatively weak correlation with the time of downstream engine replacement, which confirms the lower rate of technological progress in the industry. Comparing the time point of downstream aero-engine replacement and the time point of upstream high-temperature alloy process development, it can be observed that the time point of most high-temperature alloy process upgrading and the time point of engine replacement have relatively low degree of overlap, most of the high-temperature alloy processes run through several engine generations, and there is no obvious correspondence between the time point of the development of the same process and the time point of the engine replacement, represented by single crystal casting high-temperature alloy, whose four-generation process appeared at the time of the replacement of engine. In addition, there is no obvious correspondence between the time point of development within the same process and the time point of engine generation replacement, taking single crystal casting high temperature alloy as a representative. In addition, from the point of view of the development time line between processes, a variety of processes are applied at the same time, and the development time line of different processes overlap.

Taking the typical grade Inconel 718 (corresponding to China's GH4169) as an example, since its successful development in the 1960s, this grade has been widely used in the field of aero-engine, etc., and still occupies a dominant position in nickel-based high-temperature alloys.

This alloy has long dominated the supply structure of high temperature alloys, and since its invention by INCO Huntington Alloys (formerly Special metals. Co.) in the USA in the early 1960s, high temperature alloy suppliers have been able to mass produce high temperature alloys of this grade due to the lack of commercial or intellectual property rights restrictions on this alloy; Inconel 718 has become one of the most widely used high temperature alloy grades because of its slow precipitation of reinforcing phases, high strength at high temperatures, good castability and weldability, and easier processing and molding. In the PW4000 engine launched in the 1980s, IN718 alloy quality ratio of nickel-based alloys reached 57% (high temperature alloys in PW4000 are mainly nickel-based and iron-based alloys); in the mid-1990s, engine manufacturer GE purchased forging alloys, IN718's share of the year is located in more than 60%; to date, the scale of the application of IN718 still occupies a dominant position in high temperature alloys, and according to the report, Inconel 718 has become the most widely used grade of high temperature alloy. According to Gminsights, IN718 alone accounts for about half of the global high-temperature alloy market in 2019.

The technological change of core alloy grades is slow, and the technological development of important alloy grades fails to shake the main pattern. From the development history of high-temperature alloys derived from core grade IN718, the time between each potential derivative of IN718 is long, and most of them have not been superior to IN718 in terms of both performance and cost: in the early 1950s, Waspaloy and Rene41 alloys were used, but these alloys were harder, more malleable and less costly than IN718. Harder, less malleable and less weldable, and prone to cracking during hot working;

In the 1960s, IN718 alloy appeared, its performance and cost have certain advantages, and began to gradually replace the original alloy; in the 1980s, GE developed Rene220 casting alloy to replace the IN718 alloy, although Rene220 and IN718 performance is similar, but Rene220's Co, Ta content is higher, and therefore the cost is relatively expensive compared to IN718. In the 1990s, GE developed 991 alloy, which is close to Waspaloy, but still contains high Co and Ta, so the cost is still relatively high; in the early 21st century, in the background of the Metal Feasibility Program funded by the U.S. Air Force Laboratory, ATI increased Al and Ti content on the basis of the original IN718, and further developed a new alloy, IN718, to replace IN718. At the beginning of the 21st century, in the context of the “Metal Feasibility Program” funded by the U.S. Air Force Laboratory, ATI increased the content of Al and Ti on the basis of the original IN718, and further developed the 718 Plus alloy, which is superior to the main alloys of IN718 and Waspaloy in terms of bearing temperature and strength, and with a relative advantage in terms of cost.

2. The downstream engine market's demand for high reliability requires a long “validation period” for the widespread use of new alloys in engine components, which in turn makes it more difficult and time-consuming for new suppliers to enter the market. From the application history of core grade IN718 alloy in downstream components (taking P&W engine manufacturers as an example), the gradual expansion of the application of IN718 alloy in various engine components has taken a long time: since the invention of IN718 in the 1960s, a few years after the invention of IN718, the downstream engine manufacturers, mainly engine manufacturers, have successively released a series of specifications for the application of IN718 material, covering However, since the smelting of IN718 produced in the early days was not up to a high level, the engine and high-temperature alloy industries continued to improve the smelting and processing of IN718 from the 1960s to the 1980s, with the core focus on optimizing process parameters to improve purity and reduce segregation, and during this period, P&W applied IN718 to fewer component areas.

By the early 1970s, in addition to further optimization of IN718, the industry continued to use Waspaloy for some core engine components such as turbine discs, given the time and cost of “validating” a new material for use in a new component, until the 1980s, when the metallurgical processing of the new material, IN718, was further optimized to improve purity and reduce segregation. It was not until the 1980s, when the industry became more familiar with the smelting, processing and performance characteristics of the new material IN718, that the application of IN718 in engine components reached a climax, and it was only after 1980 that P&W's application of IN718 alloy in components exploded in a more concentrated manner.