Recently, IHS Markit released the latest report on titanium dioxide, the report said that the global titanium dioxide market in 2014 to 2019 will be an average annual growth rate of 3.5%, Asia in China under the leadership of the increase in consumption as the main driving force during the Asian demand An average annual growth rate of 5%.
At the same time, the titanium dioxide market will be further integrated, the increase in M & A activity will further reduce the number of manufacturers, the market price is expected to continue to rise.
As of 2019 the global titanium dioxide market will be an average annual growth rate of 3.5%
The market continues to integrate
US Connaught on February 21 announced that it will be 1.7 billion acquisition of Saudi Custer business, is expected to create one of the world’s largest and most integrated new leading enterprises. The combined company will operate 11 titanium dioxide mills in eight countries around the world with a total capacity of 1.3 million tonnes / year, more than Como divested from DuPont.
Kost is the world’s second largest producer of titanium dioxide, the production capacity of 86 million tons / year, and Teno is the world’s sixth largest producer of titanium dioxide, production capacity of 47 million tons / year. The acquisition is expected to be completed by the first quarter of 2018 and is still subject to regulatory approvals.
IHS Markit analyst Samantha Wietlisbach said that by 2015 to the first half of 2016, the global price of titanium dioxide is weak, the producer profit margins are low, to promote the integration of the industry. “Cost savings are critical in low-margin market environments, and large companies that have integrated into upstream raw material production have more advantage in raw material prices and can take advantage of market competition,” she said. In addition, other factors that promote the integration of the industry include China has become the world’s major producers of titanium dioxide, its supply continues to increase.
Huntsman is currently stripping the titanium dioxide business and will operate it separately with Venator Materials. Venator Materials will include its pigment business and titanium dioxide assets from Lockwood for $ 4 billion in 2013, with capacity of 788,000 tonnes / year, or about 11% of global titanium dioxide production capacity. Completed in the second quarter.
Push prices higher
Jefferies Group analyst Lawrence. Alexander said Tenco’s acquisition of Kost will support the price of titanium dioxide further higher.
Huntsman in the second quarter of 2016 and the third quarter of the continuous price of titanium dioxide prices, prices rose about 300 US dollars / ton, to promote the global price of titanium dioxide in 2016 steady rise. At present the company is promoting the second quarter of this year, the price of titanium dioxide rose.
TZ Minerals International expects the global premium titanium dioxide market price to rise by $ 319 / tonne from June 2016 to the end of 2017. Fitch Ratings also believe that titanium dioxide prices will continue to rise.
Wietlisbach said that from the supply and demand perspective, the global titanium dioxide market will be more balanced, and the terminal market demand is stable, is expected in 2017 and early 2018 titanium dioxide prices will continue to rise. After this wave of price increases, the next few years, titanium dioxide prices may stabilize, but “unlikely” to reach 2011 ~ 2012 hit 3.6 US dollars / kg such a high price.
Demand to Asia Pacific
Fitch Ratings pointed out that in recent years the titanium dioxide industry suffered a blow to overcapacity, but is currently recovering. Over the past two years, some capacity closures have effectively addressed global oversupply.
Huntsman recently announced plans to close the white-side processing and packaging operations at the titanium dioxide production facility in Calais, France, in the third quarter of 2017 to further optimize its manufacturing network. The company closed the Umbogintwini production facility in South Africa in the fourth quarter of 2016. At the same time, Huntsman’s Finnish titanium dioxide plant in Pori, which has not been fully recovered since the fire on 30 January, is currently producing only a small number of products and is expected to be fully operational by the end of 2018. Pori base titanium dioxide production capacity of 130,000 tons / year, about Huntsman titanium dioxide production capacity of 15%, accounting for about 2% of global demand.
Demand from regional demand has shifted to the Asia-Pacific region due to the tightening of markets in Europe and North America. Asia-Pacific region as the population and disposable income continues to grow, becoming the world’s largest consumer market for titanium dioxide. China has now become the world’s largest consumer of titanium dioxide, accounting for nearly one-third of global demand in 2016. IHS Markit also said in the forecast report, 2014 ~ 2019 China’s titanium dioxide compound annual growth rate of 5.6% in 2019, China’s titanium dioxide consumption will reach 2.85 million tons. In addition, in 2016 China also replaced the United States as the world’s largest exporter of titanium dioxide pigment, but China’s exports of titanium dioxide is usually a lower grade products.