On May 10, CITIC Titanium issued a price adjustment letter. From now on, the domestic market price of CR series chlorinated titanium dioxide will be increased by 1,000 yuan (ton price, the same below), and the overseas market price will be increased by 150 US dollars. So far, 21 titanium dioxide manufacturers have issued price adjustment letters since May, and the titanium dioxide market has started the fifth round of price increases this year.

 

This is the 11th month since July 2020 that titanium dioxide has been adjusted continuously, and it almost equals the record of the longest continuous increase of titanium dioxide in 2016. At present, the mainstream quotations of domestic sulfuric acid rutile and anatase titanium dioxide have risen to 21,000 yuan and 19,000 yuan respectively.

 

"The main reason for this round of titanium dioxide market increase is the long-term short supply. Due to environmental protection and installation issues, individual domestic manufacturers have reduced production and supply reduced; foreign demand has been stable and exports are improving; the main raw material titanium concentrate prices are superimposed. Rising, it is expected that this round of price increases is not over, and there will still be manufacturers to follow up and increase." Titanium dioxide analysts believe that.

Titanium concentrate prices rise

 

Titanium concentrate is the main raw material for the production of titanium dioxide. The current domestic supply of ilmenite concentrate is clearly in short supply. The price of ilmenite concentrate has doubled from the bottom price in 2020. The current national market average price is 2,450 yuan, and the cost-side support of titanium dioxide is strong.

 

In the near term, the operating rate of some mining companies in Panxi is relatively low. This is mainly due to environmental protection inspections. Some mining companies have controlled their operating rates in order to cooperate with inspections. The stable terminal demand has led to tight spot market. In May, the sales guide price of titanium concentrates from major major factories in Panxi increased by 80-100 yuan.

The Panxi titanium concentrate market will continue to operate at a high level, maintaining a trend of tight cargo prices and high prices. In the short term, after large-scale mining companies have raised their prices, small and medium-sized mining companies generally hold high quotations and are not in a hurry to ship goods, and the actual order prices are firm.

 

Market demand exceeds supply

 

In less than a month since the last round of the increase, many mainstream titanium dioxide companies have cut production and halted production due to environmental protection and equipment issues. Among them, CITIC Titanium and Sunflower Chemical have a relatively large impact on the market. CITIC Titanium reduced production by 80% due to equipment overhaul on April 6. Although production resumed on April 25, its daily output was reduced by 120 to 150 tons on average; Sunflower Chemical reduced its production by 30% due to environmental issues on April 12, which is based on China’s current environmental reduction in production. Look, it will be difficult to recover to full capacity in the first half of the year;. In addition, other manufacturers have taken some measures to reduce production or stop production in the short term, and the overall operating rate of the industry has dropped from 82% in the previous period to the current 74%.

 

At present, manufacturers are strongly controlling the supply of goods, and the supply of agents can basically be guaranteed, but there are also reductions in quantity and supply, which intensifies the tight situation of terminal titanium dioxide spot.

 

From the perspective of demand, the domestic demand for titanium dioxide is stable, and the export market is improving, which drives the price of titanium dioxide to continue to rise.

 

The export of titanium dioxide in the first quarter of this year was 328,000 tons, an increase of 35.03% and 41.01% compared with the same period in 2018 and 2019. Based on the monthly export data in the second half of 2020 and the orders received by manufacturers, the current domestic stable supply of about 110,000 tons per month can be guaranteed. At present, the pending foreign trade orders of titanium dioxide companies have accumulated until June. It is expected that the monthly export volume in the second quarter will also be about 110,000 tons, which is an increase of about 33% compared with the same period in 2018 and 2019. This will continue to support titanium dioxide. The market remains high.

 

The price is high and firm

 

At present, the two sides of the titanium dioxide market are still facing obvious confrontation, and they are in a game state, which is mainly reflected in the two aspects of supply and demand.

 

From the demand side, the titanium dioxide market is under downward pressure. The downstream industries such as plastic color masterbatches have entered the off-season, and overall demand has declined; the downward transmission of costs is difficult, and the downstream is more resistant to high-priced titanium dioxide; high-priced titanium dioxide is forcing end customers to try alternatives.

 

From the supply side, the situation of tight goods and high prices of titanium dioxide is still difficult to solve. Titanium concentrate has always been in short supply, and the production cost of titanium dioxide remains high; there are many foreign trade orders, and the main manufacturers have received orders until June; most manufacturers and distributors have tight stocks, especially some main brand products; environmental inspections and surprises Unexpected events caused some regional producers to stop production.

 

At present, there is a clear game between the supply and demand of titanium dioxide, and the mid-to-long-term market trend is still unclear. However, the profit in May is as expected, and the actual price will remain strong and firm.