TiO2 China Monthly Report Vol.2 Issue 12. 2009
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TiO2 China Monthly Report
Vol.2 Issue 12.2009
Supply & Demand
1
China’s TiO2 trade in October ISK’s TiO2 distribution in China
1 2
Upstream
3
Titanium resource draws wide attention TiO2 industry is expected to enjoys ample sulfuric acid supply in the long-term Huge new mining resource to be proved Titanium metal industry sets target for 12th Five Year Ching-Hing acquires titanium mining right
3 4 4 5 5
Company Dynamic
5
Jinan Yuxing to start rutile TiO2 pilot production Pangang Titanium’s rutile TiO2 output hits new record Rutile TiO2 competition to be intensified
5 5 6
Downstream
7
Furniture coating to boost TiO2 consumption Indian coating industry boosts TiO2 consumption Yip’s Chemical achieves huge profit growth in coating
7 8 8
Price Update
8
Price update in December 2009
8
Policy & Legislation
10
Policy interpretation related to TiO2 industry -- By Liu Changhe Raised transport cost curbs TiO2 price downturn China continues tariff-free titanium slag import
10 10 10 11
Special Report
11
Review of Chinese TiO2 industry 2009 ----- policy, raw material, production Profitability to shrink in Q1 2010
11 11 12
Latest reports related to TiO2 from CCM
- Production and Market of Masterbatch in China Made in July 2008
- The Survey of Titanium Dioxide in China-3rd Edition Published in April 2009
- The Future of Carbon Black in China The second edition was made in June 2008.
- Production and Market of Pigment in China The second edition was made in June 2008.
Trade Report of product related to TiO2 from CCM: - Titanium Dioxide Production and Trade in China 2007 June.2009
- Commodity Titanium Dioxide in China The third edition was made in June 2008.
CCM coming newsletter related to TiO2 - Inks China News
- Specialty Titanium Dioxide in China The third edition was made in June 2008.
Contact us for details of the researches in year 2009 from CCM.
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TiO2 China Monthly Report
Vol.2 Issue 12.2009
Editor Note Welcome to the December issue of the TiO2 China Monthly Report. The domestic TiO2 industry has recovered rapidly from the financial crisis in H1 2009, has experienced ,thanks to a series of supporting policies released by the government, a rebound in growth in H2 2009. On November 26th, 2009, China’s State Council has set its target on carbon emission reduction that China will cut its 2005 unit carbon emission of GDP by 40%~45% by the end of 2020. As a 2H1R industry (resourcebased industries with high energy consumption and heavy pollution), the TiO2 industry will be forced to become more environmentally friendly as it confronts stricter environmental protection requirements. With TiO2 demand entering a slack season, TiO2 price weakened starting in November 2009 and will keep this downtrend throughout Q1 2010. TiO2 capacity expansion will continue in 2010 in China, especially for rutile TiO2, which will intensify industry competition . Coupled with rising production costs, this will cause manufacturers’ profitability to shrink. However, as a consequence the TiO2 industry may gain more government support such as resumption of a tax rebate for export next year.
Headlines of TiO2 China Monthly Report 0912 •
China’s TiO2 imports show steady growth, while exports decline in October.
•
As an essential raw material of TiO2, the gradually exhausted titanium resource with rising value is attracting wide attention in China.
•
The TiO2 industry enjoys an ample supply of sulfuric acid, which is expected to continue for five to ten years.
•
China’s rutile TiO2 capacity is expected to soar next year, which will intensify domestic competition.
•
Chinese furniture coating is to boost TiO2 consumption, which drives Huihuang Xiangying to expand production scale.
•
China is likely to promulgate Standards for Tax Rebate of TiO2 Export and Entry Criteria for TiO2 Production soon.
•
Boosted by supporting policies, China’s TiO2 production has recovered rapidly by the end of 2009, drawing wide attention.
•
TiO2 profitability is expected to shrink in Q1 2010 with price downturn.
The capacity expansion will certainly boost titanium ore demand, which is in increasingly tight supply. This has drawn wide attention from related producers. However, TiO2 industry will enjoy ample supply of another raw material, namely sulfuric acid, for five to ten years.
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Main companies covered in this issue
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TiO2 China Monthly Report
Vol.2 Issue 12.2009
Supply & Demand China’s TiO2 trade in October
C
hina’s TiO2 import and export trends have diverged in October, with import volume steadily increasing, while export volume decreased.
The booming real estate industry and automobile industry have driven, and will continue to drive coating, plastic and papermaking (mainly decor paper) consumption upward. It is worth noting that TiO2 for some particular end-use sectors is mainly imported from a few manufacturers. For instance, 95% imported TiO2 for papermaking in 2009 is produced by DuPont in Mexico (TABLE 1).
Thanks to the stable demand and the negotiable price (despite several price hikes announced by multinational importers), TiO2 import volume in October hit a record high for the past three years of 25,099 tonnes, up 2.1% over this September. However, owing to weak imports in Q1 2009, the cumulative import volume in the first ten months of 2009 is still lower than that in the same period of 2008.
TABLE 1: China’s TiO2 import situation by end use sector, 2007-Oct. 2009, tonne Segment
TiO2 export volume in October declines by 13.4% over September, only amounting to 12,883 tonnes. The export volume downtrend is caused by continually rising export price in October. Despite the downtrend, cumulative export volume by October in 2009 has seen a remarkable 41.6% growth year on year.
Coating Plastic Rubber Fiber Papermaking Ink Leather Cosmetics Food Other Rutile (Uncertain application) Anatase(Uncertain application)
In the autumn, domestic TiO2 manufacturers tried to narrow the gap between import price and export price by continually raising export price. Average export price rose 5.0% in October, following a 3.7% increase in September. Average import price declined slightly in October, despite several rounds of announced price hikes, as consumers refused to accept the increases (FIGURE 1). Import growth stable
12,589
2,415
14,134
1,836
6,692
13,569 5,607 1,348 1,345 207 87 1,725
2,588 1,700 324 174 45 180 473
11,919 7,920 1,800 987 246 1,187 1,678
1,603 1,280 196 427 28 0 152
5,657 6,600 1,581 617 616 358 1,854
106,831 6,546
21,253 102,550 1,188
3,241
12,348 100,681 473
2,500
Source: China Customs, CCM International
As predicted previously (See issue 0911, page 1 ), China’s TiO2 imports keep increasing in Q4 2009.
There is an obvious TiO2 import volume increase from Australia and Mexico because of their product’s price advantage, while imports from U.S. and Japan decrease a lot (TABLE 2). With the establishment of CAFTA from January 2010 that enables free tariff for TiO2 trade between China and ASEAN countries, TiO2 imports from Malaysia and Singapore will increase in the future.
Encountering consumer resistance to price hikes in China; many TiO2 multinationals adopted flexible prices in actual deals to maintain their market position. With a rising domestic operating rate, TiO2 supply in China is ample and competition is intense. Accordingly, the average import price of TiO2 decreased by USD48/t over September.
35,000 30,000 25,000 20,000
1,500
15,000
1,000
10,000
500
5,000
0
Ja n07 M ar -0 7 M ay -0 7 Ju l-0 Se 7 p07 No v07 Ja n08 M ar -0 8 M ay -0 8 Ju l-0 Se 8 p08 No v08 Ja n09 M ar -0 9 M ay -0 9 Ju l-0 9 Se p09
0
Import
Export
Import price
Export price
Source: China Customs, CCM International
CCM International Limited
1
Price, USD/t
In the coming months, China’s TiO2 demand will remain robust, which will certainly drive up TiO2 imports. The strong demand, coupled with DuPont’s announced 3,000 price hike, which has been in effect in Asia since December 1st, 2009, will 2,500 provide room for import prices to rise, in the coming months, though the 2,000 extent might not be large .
FIGURE 1: China’s TiO2 trade situation, Jan. 2007-October 2009
Volume, tonne
JanNov- Jan-Oct NovJanOct 07 Dec 07 08 Dec 08 Oct 09 53,670 10,398 50,090 6,224 49,388 41,998 7,987 38,256 5,097 31,295
Exports Decline --Export Price Increases Reduce Chinese Export Volume in October. Driven by increasing global price and booming domestic demand, some Chinese TiO2 manufacturers have initiated TiO2 price increases in October, especially large manufacturers, such as Shandong Dongjia and Henan Billions. Accordingly, average export price of TiO2 in October rose by USD77/t over September, leading to 13.4% decline in export volume. www.cnchemicals.com
TiO2 China Monthly Report
Vol.2 Issue 12.2009
It is worth noting that some TiO2 manufacturers who initiated the price hike have not experienced a volume decline as they have endeavored to explore new global markets. Take Shandong Dongjia for example, its average export price increased by USD62/t and export volume increased slightly to 1,094 tonnes in October.
TABLE 2: China’s TiO2 import situation by origin, 2007-Oct. 2009, tonne Origin Taiwan Australia U.S.
Jan-Oct 07 Nov-Dec 07 Jan-Oct 08 Nov-Dec 08
Japan Germany Mexico Malaysia UK Singapore Saudi Arabia Other
66,645 48,983
13,521 9,015
33,971
6,191
35,861 13,096 5,359 8,296 2,818 7,035 9,207 14,251
6,191 2,660 1,650 1,288 781 1,527 2,587 3,312
59,640 46,510
Jan-Oct 09
5,737 4,957
56,617 52,076
41,612
7,456
29,780
31,776 10,819 9,100 6,661 6,501 3,172 7,783 10,433
3,283 1,681 2,000 393 301 1,358 1,280 1,218
22,881 7,669 9,240 7,093 5,894 6,126 5,013 5,448
Though total export volume obviously declined, the export value shows a relatively modest decline of only 9.1%, because of the price hike. Accordingly, domestic manufacturers might continue Source: China Customs, CCM International to raise export prices given the booming domestic market. Meanwhile, domestic manufacturers are seeking to enhance competitiveness TABLE 3: China’s TiO2 export situation by destination, 2007-Oct. 2009, tonne by improving product quality Region Jan-Oct 07 Nov-Dec 07 Jan-Oct 08 Nov-Dec 08 Jan-Oct 09 instead of relying solely on Volume Share Volume Share Volume Share Volume Share Volume Share price based competition. Asia Pacific has been the main export destination of Chinese TiO2. Domestic manufacturers will continue to consolidate current market share in Asia Pacific and make effort to exploit new markets in other regions (TABLE 3).
Africa Asia Pacific Europe Middle East North America South America
2,255
1.45%
64,948 41.77%
422
1.86%
3,852 16.97%
17,027 10.95%
2,375 10.47%
25,025 16.10%
4,042 17.81%
7.60%
2.62%
5.25%
3,074
2.53%
5,739 48.41%
62,713
51.56%
1,367 11.53%
11,545
9.49%
9.72%
667 5.63%
12,225
10.05%
14,194 16.52%
2,757 23.25%
20,332
16.72%
704 5.94%
11,750
9.66%
10,136 44.66% 37,652 43.82%
34,402 22.13%
11,816
2,249
1,867
8.23%
16,279 18.95% 8,347
7,196
8.38%
622
Source: China Customs, CCM International
Despite implementing the largest export price increases, Henan Billions has surpassed Sichuan Lomon to be the largest TiO2 exporter by October 2009. It has not only consolidated its share in major markets such Turkey and Italy, where it now has the largest share amongst importers , but Henan Billions has also made great efforts to exploit new markets worldwide. By October, Henan Billions’ sales network has covered over fifty countries or regions worldwide. China’s TiO2 export is expected to keep stable with a more profitable price.
TABLE 4: Export situation of China’s TiO2 manufacturers, 2007-Oct. 2009, tonne Manufacturer
Jan-Oct 07
Nov-Dec 07 Jan-Oct 08 Nov-Dec 08 Jan-Oct 09
Henan Billions Sichuan Lomon Shandong Dongjia
7,007 21,522
1,217 3,935
15,410 6,573
20,443
2,151
Guangxi Jinmao Wuxi Haopu Guangxi Yazhao Zhenjiang Titanium Pangang Group Shanghai Jianghu Pinggui Feidie Other
4,721 1,766 6,861 9,393 10,781 2,855 4,477 65,647
659 386 1,009 657 1,111 431 795 10,343
2,080 1,005
17,285 16,938
3,990
775
10,805
4,732 1,344 6,500 1,677 2,596 3,398 3,663 36,036
493 191 361 381 269 210 662 5,429
8,467 5,934 5,166 4,295 4,359 4,202 3,904 40,285
Source: China Customs, CCM International
ISK’s TiO2 distribution in China
I
FIGURE 2: Distribution channels of ISK’s TiO2 in China, Jan.-Oct.2009
shihara Sangyo Kaisha Ltd. (ISK) has had 13.9% of China’s TiO2 import market during Jan. - Oct. 2009, with import volume amounting to 28,987 tonnes during this period. Most of ISK’s total import volume (78.9%) comes from Japan, as ISK’s R-930 production in Japan is specially developed for Chinese consumers, and the rest is from its Singapore plant.
End user 23.50%
ISK has set up strategic cooperation with a local trade Trader company, Hangzhou Harmony Chemical Raw Material Co, 76.50% Ltd. (Harmony Chemical), to develop its business in China. This has indeed helped ISK expand its Chinese market share. Source: China Customs, CCM International Fifty five percent of ISK’s TiO2 business in China was through Harmony Chemical by October 2009. CCM International Limited
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TiO2 China Monthly Report
Vol.2 Issue 12.2009
Upstream Titanium resource draws wide attention
A
s an essential raw material for TiO2 production, titanium ores are being depleted. This has boosted ore values, and has drawn wide attention from firms both inside and outside the TiO2 industry.
By 2009, the proven titanium reserves in Panzhihua City have been dominated by a few companies, mainly Pangang Group, Sichuan Lomon, and Hongda Group. High grade titanium ore can contribute to the quality of TiO2 because of its lower level of impurities, which can improve TiO2 quality. To pursue long-term development, titanium ore holders with stronger vertical integration capability will be able to more effectively raise the recovery rate, or yield, of titanium ore and improve TiO2 quality, compared to smaller players.
At present, the domestic recovery rate of titanium ore is estimated at 15% which is quite low. Current domestic titanium ore mining and refining capacity cannot meet domestic demand, resulting in China’s annual imports of titanium ore of over one million tonnes, or about 50% of domestic demand. In early 2009, QIT-Fer et Titane Inc. (QIT), one of the world’s largest titanium slag manufacturers and a wholly owned subsidiary of Rio Tinto, suspended its titanium resource exploitation and titanium slag production in Canada for eight weeks from July 12 to September 8, 2009.
Facing limited titanium resource, TiO2 manufacturers would make efforts to raise the recovery rate in order to realize TiO2 industry’s sustainable development. Meanwhile, TiO2 manufacturers can utilize more high-grade titanium ore, which can help them improve TiO2 quality to some extent. Likewise, to maximize titanium resource value, private investors will also work hard to raise recovery rate of titanium resource.
Import volume of titanium slag from Canada decreased to 7,365 tonnes in first eight months of 2009 from 34,214 tonnes in the prior year. QIT’s supply reduction pushed up import prices of titanium slag from Canada into China during that period, thus leading to higher production costs for Chinese industry...
With the importance of titanium resource widely known and more funds injected, titanium resource recovery rate is expected to be raised, which will benefit the long-term development of the TiO2 industry. For example, Panzhihua government has aimed to raise the recovery rate to 65% by 2020. In the future, with the rising recovery rate and expanding exploitation capacity, domestic titanium ore supply will meet the entire domestic demand, as China holds 35% of world’s titanium reserves.
The heavy dependence on imported titanium feedstocks has put domestic feedstock consumers in a vulnerable position, arousing increasing concerns about the availability of titanium feedstocks. In addition, depleted ore reserves, and soaring growing demand indicate significant potential for value appreciation of titanium ore reserves. Therefore, many private investment funds are attracted to invest in TABLE 5: TiO2 manufacturers with their own titanium resource, 2009 this field. Company
For instance, China VTM Mining raised funds through becoming listed in Hong Kong, in order to expand its titanium ore exploitation and titanium slag production (See issue 0910, page 6), and Ching-Hing shifted to titanium ore exploitation through acquiring Greater China Mining Resource Limited (See issue 0911, page 9), etc.
Reserves
Pangang Group
Baima Mining: 1.5 billion tonnes (average grade 6.2%) Panzhihua Mining: 1.3 billion tonnes (average grade 12%) Sichuan Lomon Northern area of Hongge Mining: 2.0 billion tonnes (average grade 11%)* Yunnan Dahutong Yunnan Fuming County Shandong Dongjia Hebei Chengde City Fumin Longteng Titanium Yunnan Fuming County
Additionally, Hongda Group, China’s third largest electrolytic zinc company, in August 2008, has set up Note: *Southern area of Hongge Mining is captured by Hongda Group a joint venture with other nine companies including (2.0 billion tonnes*11% grade) Panzhihua Gangcheng Group Co, Ltd, Panzhihua Jinjiang Source: CCM International Titanium Co, Ltd, etc. It claimed that over USD 3.22 billion will be injected in this joint venture to exploit ores containing titanium in the southern area of Hongge Mining, Panzhihua City. Some domestic TiO2 manufacturers have also begun to work hard on developing more titanium ore reserves. For example, Pangang Group plans to acquire titanium mining exploitation rights in New Zealand by cooperating with New Zealand Steel Mining Limited. Yunnan has started up a new TiO2 plant and a titanium slag plant in Panzhihua City, Sichuan Province, to utilize local Ti ore resources, even though it already has titanium exploitation rights in Yunnan Province. Some new entrants also have their own captive titanium mines, such as Fumin Longteng Titanium Co., Ltd . (TABLE 5)
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TiO2 China Monthly Report
Vol.2 Issue 12.2009
TiO2 industry is expected to enjoys ample sulfuric acid supply in the long-term
Y
unfu Pyrite Enterprise Group Corporation (Yunfu Pyrite) started pilot production of its 400,000t/a sulfuric acid production line on November 25th, 2009. This production line using pyrite as raw material is one of the largest production lines in China.
of nearly 70 million t/a, shared by pyrite-based sulfuric acid (31.3%), sulfuric acid through sulfur-burning (38.7%) and by product sulfuric acid from smelting gas (28.7%). By 2012, China’s sulfuric acid capacity is expected to reach 90 million t/a, with pyrite-based sulfuric acid increasing by 8 million tonnes, sulfur-burning sulfuric acid by 5 million tonnes and smelting gas sulfuric acid by 7 million tonnes.
After the formal launch, Yunfu Pyrite, located in Yunfu City, will supply its sulfuric acid to Yunfu Huiyun Titanium Dioxide Co, Ltd. (Huiyun Titanium) that has anatase TiO2 capacity of 15,000t/a; and is to launch 30,000t/a rutile TiO2 production line in 2010. Huiyun Titanium will consume 200,000 tonnes sulfuric acid in TiO2 production annually by the end of 2010. Meanwhile, Huiyun Titanium is to set up 200,000t/a sulfuric acid production line. Hence, Huiyun Titanium can enjoy plenteous sulfuric acid supply for its TiO2 production.
TiO2 manufacturers are to benefit greatly from the expected abundant sulfuric acid supply. TiO2 Price is expected to continue an uptrend for the foreseeable future and thus TiO2 manufacturers will improve their profitability with a stable sulfuric acid cost.
Huge new mining resource to be proved
The situation with Huiyun Titanium is emblematic of the whole TiO2 industry, which is beginning to experience loosenting sulfuric acid supply. This situation is expected to continue for five to ten years.
O
n December 2nd, 2009, Panzhihua City held a ceremony for initiating prospecting of vanadium titano-magnetite ore resource in Panzhihua-Xichang Region (Panxi Region).
The following factors account for the long-term abundant supply of sulfuric acid to the TiO2 industry.
According to Sichuan Bureau of Geology and Mineral Exploration and Development, the reserves of vanadium titano-magnetite ore resource in Panxi Region is expected to increase by an estimated amount of up to 19 billion tonnes valued at USD1,669 billion based on current price of vanadium titano-magnetite ore. If the new reserve is proved, total titanium resource ore reserve volume (about 10% of the total vanadium titano-magnetite ore) will triple to 1,9 billion tonnes o, thus promoting local TiO2 industry development in the future.
Firstly, raw material for sulfuric acid production is rich. According to Sulfur 2009 International Conference and Exhibition held during November 8th-11th, 2009, in Vancouver, Canada, global sulfur supply will exceed demand for the next ten years, which helps to reduce the production cost sulfuric acid manufactured from burning sulfur. Global sulfur supply is expected to increase from 48 million tonnes in 2008 to 70 million tonnes in 2017, which might lead to a 15 million tonnes surplus by then, according to Mr. Clark from the Alberta Sulfur Research Center.
The prospecting is expected to be finished in the coming three to five years.
In addition, the nonferrous smelting industry will continue to drive increased production of sulfuric acid from smelting gas. In general, producing one tonne nonferrous metals produces about three tonnes sulfuric acid. With the fast growth of the nonferrous smelting industry, China’s sulfuric acid output has doubled from 2003 to 2008. According to the multi-national mining and smelting firm Anglo-American, China will lead development of global nonferrous smelting for the next ten years, especially for copper smelting.
Early in May 2009, Panzhihua City has made its mid-range plan by 2020 for vanadium titanium industry, in which it is stated that Panzhihua government will invest USD39.98 billion in establishing a vanadium-titanium industrial cluster that can generate USD41 billion (RMB280 billion) sales revenue by 2020, as well as in raising recovery rate of vanadium from 47% to 55%, and that of titanium from 14% to 25%.
Capacity expansion of sulfuric acid with smelting gas helps sulfuric acid price avoid the influences from sulfur price fluctuation which are mainly caused by the price fluctuations of crude oil. Secondly, the fertilizer industry, the main downstream consumer of sulfuric acid, will not see growth in demand for sulfuric acid. Generally, sulfuric acid used in fertilizer consumes 60-70% of the total national acid production. China’s fertilizer industry has suffered from redundant construction and will enter a period of slow expansion. By the end of 2008, excess capacity of phosphate fertilizer and urea reached 13 million tonnes and 9 million tonnes respectively. Owing to fertilizer overcapacity, sulfuric acid consumption in fertilizer will not see significant growth. Hence, sulfuric acid price is expected to remain stable for a long time to come. By the end of 2008, China had annual sulfuric acid capacity CCM International Limited
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TiO2 China Monthly Report
Vol.2 Issue 12.2009
Company Dynamic
Titanium metal industry sets target for 12th Five Year
may be no new titanium
C
ore in titanium sponge
Association (CNMIA) sets
ore consumption will
its development target for
continue to be concentrated
titanium sponge during
A
TiO2 production in the new
in TiO2 production. In
the 12th Five Year Plan
Chemical Plant (Jinan
general, titanium sponge
Before the relocation, Jinan
Yuxing), it will start pilot
production utilizes high Ti
Yuxing had capacity of
production for its new
sponge capacity in the coming five years.
pollution to Xiaoqing River. As scheduled, Jinan
Jinan Yuxing to Yuxing starts relocation at start rutile TiO2 the end of December and pilot production will formally launch rutile
Hence, demand for titanium
hina Nonferrous
production will not see any
Metals Industry
major increase and titanium
ccording to Jinan
location in Q1 2010.
Yuxing General
According to the target,
content titanium slag (TiO2
CNMIA aims to keep
content higher than 90%) as
national total capacity of
20,000t/a for rutile TiO2 and rutile TiO2 production line 10,000t/a for anatase TiO2. with first phase capacity of
raw material and consumes
titanium sponge below
100,000t/a in December
about 10% of all titanium
Jinan Yuxing plans to invest
100,000t/a in the 12th Five
2009.
ore consumed in China.
in the second phase with capacity of 200,000t/a,
Year, indicating that there
In fact, the new production
aiming at a total capacity of line is part of Jinan Yuxing’s 300,000t/a by 2012. relocation project. Jinan Yuxing has to shut down its original production line for
a titanium mining right
Ching-Hing acquires titanium mining right
O
relocation, due to its heavy
in Ziyang County, Shaanxi Province (See issue 0911, page 9).
Pangang Titanium’s rutile TiO2 output hits new record
However, it is uncertain when the titanium ore can
n November 19th,
be exploited, as Ching-
2009, Ching-Hing
Hing has not obtained an
(Hong Kong) Limited
exploitation license from the
(Ching-Hing) successfully
government.
A
ccording to Pangang Group, Pangang Group Titanium Panzhihua Plant (Pangang Titanium)
produced 1,930 tonnes rutile TiO2 in November 2009, hitting a new monthly record.
acquired titanium mining rights in Ziyang County,
The news about the
Shaanxi Province.
acquisition has boosted a
Pangang Titanium’s current rutile TiO2 production line is the first phase project with capacity of 20,000t/a launched
171.4% growth of ChingAccording to Ching-Hing, it
Hing’s stock on the Stock
raises USD245.97 million for
Exchange of Hong Kong
acquiring the entire equity
after resumption of trading
interest in Greater China
on November 19th, 2009.
in December 2007. The product branded PTR308 is intended to be used in coatings and inks. Thanks to the soaring demand, Pangang Titanium has almost operated at full capacity this November 2009.
Mining Resource Ltd. which
Additionally, Pangang Group Mining Plant (Pangang
owns 95% share of Shaanxi
Mining) produced titanium concentrate ore of 25,590
Tai Sheng Da Mining
tonnes, which also hit a record high, in November 2009.
Company Limited who holds
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TiO2 China Monthly Report
Vol.2 Issue 12.2009
Rutile TiO2 competition to be intensified
A
ccording to CCM’s survey, rutile TiO2 capacity under
as is their usual strategy. This will do no good for their long-
construction in China currently has reached 385,000t/
term profitability and development.
a all of which is expected to be launched in 2010. China’s rutile TiO2 capacity will soar to 1,201,000t/a by the end of
Hence, China’s rutile TiO2 manufacturers, especially the new
2010, up 47.2% year on year (TABLE 6)
entrants, are suggested to improve product quality first and broaden distribution channels to cope with international
In November 2009, Hubei Wuhan Fangyuan Titanium
competition, especially in the emerging markets in developing
Dioxide Co., Ltd. (Wuhan Fangyuan) initiated pilot production
countries like India and others in Southeast Asia.
of its rutile production line, with the first phase capacity of TABLE 6: Rutile TiO2 capacity expansion of some manufacturers, 2010
20,000t/a.
Company
According to Mr. Yang, sales director of Wuhan Fangyuan, the company has started its rutile production line construction
Lomon Titanium Jinan Yuxing
early in 2007. But owing to difficulties with land acquisition and the outbreak of the financial crisis, it is not until TiO2
Panjin Titanium
demand rebounded rapidly in 2009 that Wuhan Fangyuan started the trial production.
Xingzhong Titanium Xichang Ruikang Fumin Zechang Jiangxi Tianguang Huiyun Titanium Pangang Titanium Wuhan Fangyuan Subtotal National total
Mr. Yang indicates that Wuhan Fangyuan used to be an anatase TiO2 manufacturer with capacity of 10,000t/a. To strengthen its competitiveness, Wuhan Fangyuan set up a rutile TiO2 production line with a design capacity of 60,000t/ a in 2007. In fact, besides Wuhan Fangyuan, many other anatase TiO2
Capacity Incremental Remark 2010 capacity, t/a 120,000 40,000 Expansion Relocation & 100,000 80,000 expansion Expansion 45,000 25,000 (chloride process) 50,000 30,000 Expansion 60,000 60,000 New entrant 30,000 30,000 New entrant 50,000 50,000 New rutile line 30,000 30,000 New rutile line 40,000 20,000 Expansion 20,000 20,000 New rutile line 495,000 385,000 -1,201,000 385,000 --
Source: CCM International
manufacturers in China have shifted to rutile TiO2 production in the past two years, due to the intense competition in the anatase TiO2 market, by building new rutile TiO2 production lines or by engaging in TiO2 post treatment. Take for example, Anhui Annada Titanium Industry Co., Ltd. (Anhui Annada), a listed anatase TiO2 producer; it launched a rutile TiO2 production line in 2009, which has improved its profitability. However, due to depressed TiO2 demand during the economic downturn, some projects have been postponed. The fast expanding rutile TiO2 capacity will certainly intensify competition in Chinese market, and will likely restrict TiO2 price increases in 2010. Based on CCM’s survey, China’s TiO2 apparent consumption in 2008 amounted to 1,216,000 tonnes, with rutile TiO2 at 59.5% of consumption or 720,000 tonnes. Even assuming that China’s demand for rutile TiO2 will increase by 25% in 2010, there will still be an oversupply of rutile TiO2, when all the new capacity is brought on-line. Accordingly, competition will intensify, which will impose pressure on TiO2 manufacturers trying to raise prices. By the end of 2010, with all this new capacity, Chinese companies may start price wars to capture more market share
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TiO2 China Monthly Report
Vol.2 Issue 12.2009
Downstream Furniture coating to boost TiO2 consumption
O
Besides domestic enterprises, coating multinationals have also
China’s well-known furniture coating manufacturer
recognized the huge furniture coating market in China and
located in Huizhou City, held a ground-breaking ceremony
expanded their production capacity in China through
for its new coating production factory in Qingyuan City,
acquisition. Early in 2006, Valspar acquired the coating
Guangdong Province. The factory has a production capacity
business of China Resources, one of China’s largest coating
of 39,000t/a mainly for furniture coatings.
manufacturers, enabling Valspar to capture more market
n November 30th, 2009, Huizhou Huihuang Xiangying Coating Co., Ltd. (Huihuang Xiangying),
share in China (TABLE 7). According to Mr. Lin, sales director of Huihuang Xiangying,
TABLE 7: Main furniture coating companies in China, 2008
to meet the increasing demand and to capture more market
Company
share, Huihuang Xiangying invested USD14.64 million in the
Output, tonne
Akzo Nobel (including ICI) Valspar (including China Resources) Nippon Paint
new facility to expand its production capacity. He indicates that Huihuang Xiangying accounts for 70% market share of
100,000 90,000 50,000
Taiho International Bauhinia Paints Zhanchenda Chemical Carpoly Paint Sopel Chemical PPG
the high-end market, with its furniture coating used in jewelry, instrument, and exhibit cases, selling under the brand name Xiangying Coating. The promising future of the furniture coating market, together
50,000 35,000 30,000 20,000 20,000 10,000
Source: CCM International
with its current supply failing to satisfy customers’ demand, constitutes the main reason for Huihuang Xiangying’s production expansion.
Paints and coatings is the largest end use sector of TiO2, and furniture coatings play an important role in coatings. The
By September 2009, China has produced 431 million pieces of
rapid development of furniture coatings is beneficial to the
furniture, with output value of USD79.7 billion, up 7.2% year
growth TiO2 consumption. According to the average
on year, with about 22.8% of the total value for export sales.
consumption of TiO2 in coating, furniture coatings are predicted to consume 110,000 tonnes TiO2 in 2009.
Booming furniture production is expected to drive up furniture coatings output in 2009 to exceed 1,100,000 tonnes,
According to the purchasing department of Huihuang
or about 15% of the total coatings output. Chinese furniture
Xiangying, TiO2 is used as a pigment in coating production.
coatings output has increased with CAGR of 18% during 2004-
As its products are marketed at the high-end sectors that
2009 (FIGURE 3).
require TiO2 with excellent physical and chemical properties, Huihuang Xiangying will mainly use
FIGURE 3: Production situation of furniture coating in China, 2004-2009
DuPont’s TiO2.
Output, tonne
7,500,000
30.0%
6,000,000
20.0%
4,500,000 10.0%
3,000,000
0.0%
1,500,000
In the coming years, China will continue to accelerate the urbanization. By the end of 2008, China’s urbanization rate is 45.7%
Growth rate
40.0%
9,000,000
and expected to rise to 50% by 2015. That will boost furniture production, thus driving up demand for furniture coating, especially in high-end market. The high-end market will continue to
-10.0% grow and to be captured by imported
0 2004
2005
2006
2007
2008
2009 Est.
TiO2 with relatively good quality in the near-term.
Furniture coating Source: CCM International Grow th of furniture coating
CCM International Limited
Coating Grow th of coating
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TiO2 China Monthly Report
Vol.2 Issue 12.2009 rate of Indian economy, and this is expected to continue in the coming years.
Indian coating industry boosts TiO2 consumption
Currently, architectural coatings account for 75% of the coatings capacity in India. The coatings market is
K
ansai Paint Co., Ltd. (Kansai Paint) plans to invest
concentrated amongst a few companies, including Asian
USD 22 million to expand architectural coatings
Paints, KNP, Berger Paints, and Akzo Nobel, etc.
production in its Indian plant, Kansai Nerolac Paints Ltd. (KNP). After the launch of the new capacity (5,000t/
The continually developing coatings industry in India will
a) in 2010, Kansai Paint will have architectural coatings
certainly drive up TiO2 consumption. Though India has its
capacity of 20,000 t/a in India, which will help Kansai
own TiO2 plants and levies an anti-dumping duty on Chinese
Paint enhance its competitiveness in India.
anatase TiO2, India still imports a large volume of TiO2 from China. By October 2009, India had imported 10,233 tonnes
In India, coating output has increased with growth rate of 12-
TiO2 from China, or 12.9% of India’s total import volume.
15%, approximately 1.5-2 times as fast as the overall growth
According to the report, good brand
development. According to Yip’s
Yip’s Chemical achieves huge profit growth in coating
reputation, lower price of raw materials,
Chemical, it will continue to expand
capacity expansion, and huge market
its production capacity in Shanghai
in the mainland, jointly contributed to
(architectural coatings), Hebei and
its profit increase. In May 2009, Yip’s
Zhongshan (both for inks), respectively.
Y
Chemical launched its new plant in
By the end of 2012, Yip’s Chemical’s
ip's Chemical Holdings Limited
Tongxiang, Zhejiang Province, which
coatings production capacity (including
(Yip’s Chemical) gained profit
helped to strengthen its architectural
architectural coatings and inks) is
of USD18.92 million from its coating
coatings and inks businesses. Both
expected to increase by 60% or more.
business, which constitutes 49%
its architectural coatings and inks
of the company’s total profit, by
businesses achieved a 23% growth rate.
September this year, up 129% year on
Listed on Hong Kong Stock Exchange, Yip’s Chemical has three core
year, according to its 3rd quarterly
Propelled by the huge domestic
businesses including solvents, coatings,
report released on November 26th,
market potential, Yip’s Chemical is to
and lubricants, with 17 manufacturing
2009.
strengthen its competitiveness through
plants in China. Yip’s Chemical also
capacity expansion and product
holds a 5% share of Sichuan Lomon
Price Update Price update in December 2009
T
iO2 products and the major raw material titanium concentrate ore have maintained a price downtrend with fluctuation in December 2009. On the contrary, sulfuric acid price has continued its short term trend of a strong rise. Ex-factory prices of TiO2 and sulfuric acid in December 2009, USD/t Area South west East China Central China South China
Rutile TiO2
Anatase TiO2
Sulfuric acid 98%
November 1,977-2,241
December 1,977-2,241
November December November 1,435-1,933 1,362-1,860 44-66
December 47-66
1,846-2,007
1,845-2,006
1,435-1,465
1,391-1,435
28-59
29-73
1,904-2,051 N/A
1,904-1,977 N/A
1,465-1,538 1,435-1,509
1,391-1,435 1,362-1,391
22-37 26-44
22-51 29-51
Source: CCM International
TiO2 With decline in demand, TiO2 price has fallen in December 2009. CCM International Limited
8
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TiO2 China Monthly Report
Vol.2 Issue 12.2009
December is the traditional slack season of the domestic TiO2 industry. Because of the bad weather in North China, many construction projects are suspended, thus leading to decreased demand for coatings. As a result, many coatings manufacturers reduce their purchases of TiO2. With increased inventory levels, TiO2 prices decreased this month, especially anatase TiO2. With oversupply and poor demand, TiO2 price is expected to maintain a downtrend in the coming few months. Sulfuric acid On the whole, sulfuric acid price has continued to advance in December 2009, thanks to an inventory shortage and continuous price increases of its major raw material --sulfur. Recently, some sulfuric acid manufacturers have suspended production to overhaul equipment, such as Jiangxi Copper Corp. which suspended operation of a 600,000t/a production line on 10 Dec. 2009. Therefore, sulfuric acid supply has fallen short. In addition, manufacturers of phosphate fertilizer, an important downstream consumer of sulfuric acid, are running at full capacity, thus further raising their purchase volume of sulfuric acid. With these factors, for the short term, sulfuric acid prices are expected to rise further in China. Ex-factory prices of titanium concentrate ore and titanium slag, Dec. 2009, USD/t Area Sichuan Hainan Yunnan Guangxi Liaoning
Titanium concentrate ore
Titanium slag
Grade 40%-46%
November 82-117
December 82-110
Grade November 74%-78% 366-388
December 366-388
45%-54%
103-125
100-120
N/A
N/A
N/A
45%-47% 50%-52% N/A
92-103 110-117 N/A
85-100 105-114 N/A
77%-92% N/A 92%
395-513 N/A 571-601
425-557 N/A 600-615
Source: CCM International
Titanium concentrate ore With TiO2 market entering its traditional off-season this month, titanium concentrate ore prices have generally seen a downtrend but with fluctuations due to weak demand. Owing to excessive production before the demand dip, titanium concentrate ore has seen surplus supply this month, leading to a price decline but the extent is slight as many concentrate manufactures are not selling their inventory, but instead waiting for prices to rise. Vietnam titanium concentrate ore price in China also shows signs of decline, mainly attributed to its weak demand and price decreases of domestic titanium concentrate ore. However, due to high shipping charges, Vietnam titanium concentrate ore price never falls very much. Titanium concentrate ore price is predicted to decrease in the following months. Titanium slag As national electricity price is raised, manufacturing cost of titanium slag has risen by about USD18/t, thus leading to price increase of titanium slag this month. However, high titanium slag price fails to show significant advances, which reflects the sluggish demand from its downstream industries such as titanium sponge. Titanium slag price is forecast to remain stable with slight increase in the near future.
CCM International Limited
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TiO2 China Monthly Report
Vol.2 Issue 12.2009
Policy & Legislation Policy interpretation related to TiO2 industry -- By Liu Changhe Editor note: in order to restrict blind expansion and gain more supports from the government, China National Coatings Industry Association (CNCIA)’s titanium dioxide branch held an annual meeting in Chengdu City on December 3rd-5th, 2009. In the meeting, CNCIA drew up Declaration of Green TiO2 industry (See issue 0909, page 17), and also discussed the drafts of Standards for Tax Rebate of TiO2 Export (Standards) and Entry Criteria for TiO2 Production (Entry Criteria). Mr. Liu Changhe, leader of CNCIA TiO2 expert group, will interpret the Standards and Entry Criteria for you.
with the national development trend of energy saving and environmental protection, and will drive the TiO2 industry toward sustainable development, as well as represent TiO2 manufacturers’ benefits, they are very likely to be adopted by the government in the near future. Guided by the Standards and Entry Criteria, as well as the Declaration of Green TiO2 industry, China’s TiO2 industry is expected to gain more support from the government and will develop more healthily in the coming years.
W
ith the purpose of promoting TiO2 industry development, the Chinese government used to
implement such preferential policies as an export tax rebate. However, in the past two years, the Chinese TiO2 industry has expanded rapidly without adequate concerns for environmental protection, which thus impelled the government to cancel the tax rebate in 2007. This has caused a great impact on TiO2 industry development. Liu Changhe
To gain more support from the government, the CNCIA
Chief and senior expert in domestic titanium dioxide production by chloride process, senior adviser and former vice president of Jinzhou Ferroalloy Co., Ltd. (China’s unique TiO2 manufacturer adopting chloride process) is appointed as the leader of the expert group of the TiO2 branch of China National Coatings Industry
titanium dioxide branch drafted the Standards and Entry Criteria, both of which are intended to promote sustainable industry development over the long term. As the Standards suggest, the government should reinstitute the tax rebate for TiO2 exports. However, only TiO2 manufacturers that pass ISO9001, ISO14000 and obtain clean production certifications from local governments will be able to enjoy the tax rebate. This draft also emphasizes that no
Raised transport cost curbs TiO2 price downturn
matter how large the production scale is, TiO2 manufacturers should have their own treatment facilities for three kinds of wastes. Otherwise, they won’t be able to gain the export tax
A
ccording to National Development and Reform
rebate.
Commission, rail transport cost is raised from USD
To arouse deeper concern from TiO2 manufacturers on
0.014/t.Km to USD 0.015/t.Km effective December 13th,
environmental protection, TiO2 industry also released the
2009.
Declaration of Green TiO2 industry to help change the public’s The adjustment of rail transport cost will go against inland
bad impression of the TiO2 industry.
TiO2 manufacturers’ product distribution, especially in For the Entry Criteria, it aims at restricting excessive TiO2
Panzhihua City. Generally, railway is a major means of
capacity expansion by raising the entry threshold for new
transport for delivering TiO2 produced in Panzhihua City, a
entrants, requiring that the minimum unit capacity should
region whose TiO2 capacity share is over 20% of the national
be at least 50,000t/a for sulfate process and 60,000t/a for
total. The increased cost will also impact Panzhihua’s
chloride process. In addition, the Entry Criteria suggests that
titanium ore transportation costs
the government should promote TiO2 industrial integration to The increased transportation costs help to slow down TiO2
eliminate inefficient capacity as the coal-mining industry does.
price downturn that has begun since TiO2 demand started to enter the slack season in November.
Since the drafts of the Standards and Entry Criteria are in line
CCM International Limited
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TiO2 China Monthly Report
Vol.2 Issue 12.2009
China continues tariff-free titanium slag import
O
n December 8th, 2009, the Sate Council approved the scheme for eliminating the tariff on imported titanium slag (HS Code: 38249099) in 2010.
According to the scheme, China will continue with a zero tariff on imported titanium slag, which has been implemented since 2007. In addition, the government will subsidize imports of resource-based products and introduction of key technologies by paying borrowing costs for loans. The exact details of the policy have not been revealed yet. The resource-based products cover titanium ore, copper ore, lead ore, etc. To protect domestic titanium resources, it will levy tariffs of 10% on exported titanium ore (HS Code: 26140000). Enjoying the preferential policy, China’s imports of titanium ore resource have experienced rapid increases. By October 2009, China has imported 1,154,665 tonnes titanium concentrate ore (HS Code: 26140000) and over 150,000 tonnes titanium slag (HS Code: 38249099).
Special Report
C
Review of Chinese TiO2 industry 2009 ----- policy, raw material, production
hinese TiO2 industry has
package.. Driven by these supportive
Dingxing, Panzhihua Taihai, etc,
experienced ups and downs in
policies, China has become the world’s
suspended their production due to their
the past two years. After the decline
largest automobile manufacturer and
inadequate environmental protection
caused by the global financial crisis
the largest automobile market by
measures. In order to improve
at the end of 2008, the industry
October 2009, which will stimulate
environmental protection awareness
has seen an obvious rebound since
TiO2 consumption in coatings, plastics
and sense of social responsibility, China
Q2 2009. Both production and
and other end-use sectors.
National Coatings Industry Association
consumption of TiO2 are booming in
(CNCIA) Titanium Dioxide Branch
H2 2009, thanks to the government’s
There are also preferential policies
released a Declaration of Green TiO2
supportive policies. The current
closely related to TiO2 industry. For
Industry Guidelines in August 2009.
thriving TiO2 industry has driven
instance, Chinese government has
up demand for titanium ore that is
abolished import tariffs on titanium
Next year, the government is expected
gradually depleting existing reserves
concentrate ore (HS Code: 26140000)
to raise entry threshold for new entrants
and feedstock production capabilities.
and titanium slag (HS Code: 38249099),
in TiO2 industry and to resume tax
The anticipated increasing tightness
and also lowered the tariffs on sulfuric
rebates that were discontinued in 2007,
of feedstock supplies, has attracted
acid (HS Code: 28070000) in 2009.
for TiO2 manufacturers who implement
widespread attention, and increasing
Meanwhile, to protect domestic TiO2
adequate environmental protection
investment in new ore resources from
producers, it subsidizes titanium ore
measures.
investors and mining firms.
and feedstock imports payment of interest expense on loans for working
Policy
September 2009.
Compared with 2008, Chinese TiO2
To cope with the 2008-2009 financial crisis, the Chinese
Raw material
capital or approved projects since industry enjoyed a relatively stable raw Environmentally related policy
material market in 2009.
is another driver for domestic government promulgated a series of
TiO2 development. In 2009, the
For sulfuric acid, owing to the rapid
supportive policies, including stimulus
government heightened environmental
capacity expansion and slow demand
plans for ten industries and USD586
requirements for TiO2 production.
growth, Chinese sulfuric acid capacity
billion for an economic stimulation
Some manufacturers, such as Panzhihua
has experienced redundant construction
CCM International Limited
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TiO2 China Monthly Report and oversupply, which it is expected to
Vol.2 Issue 12.2009 in acquiring mining rights abroad.
maintain for many years to come. But
its post treatment. Capacity expansion and production shifts can actually help
with shrinking capacity share of sulfur-
Despite the rapid development of
the manufacturers to improve their
burning process, sulfuric acid price will
domestic titanium ore resources, China
profitability in the short term but also
play a less important role in influencing
still relies heavily on imported titanium
has greatly intensified the competition
sulfur price, which is mainly influenced
ore. By October 2009, it has imported
amongst Chinese producers.
by crude oil price. Besides, many TiO2
a total of 1,154,665 tonnes titanium ore
manufacturers have built their own
concentrate, up 8.2% over previous year.
sulfuric acid production lines to match
Some manufacturers, such as Panyu Titanium, are working hard on
with their TiO2 production. Benefiting
In the foreseeable future, oversupply of
competitiveness enhancement through
from stable sulfuric acid prices, TiO2
sulfuric acid and heavy dependence on
product quality improvement, instead
manufacturers improved profitability in
imported titanium ore are expected to
of capacity expansion. This has helped
2009.
remain unchanged.
them capture more high-end markets.
For titanium ore, its demand keeps
Production
In 2009, China has set a target that TiO2
increasing with slight price fluctuation
capacity utilizing the chloride process
in 2009. However, with gradually
With rebounding demand and
will account for 15% of the national total
exhausting resources and soaring
improved environmental protection,
by 2015, which seems too optimistic.
demand, titanium ores and feedstocks
TiO2 operating rates have seen rapid
Nevertheless, Jinzhou Titanium,
have drawn wide attention from many
increases this year, reaching nearly 90%
China’s first manufacturer adopting
TiO2 manufacturers and mining
in Q4 2009, as the soaring titanium ore
the chloride process, has doubled its
companies that have plans to invest
imports indicates.
capacity to 30,000t/a in 2009, and its
more in the ore sector. Some enterprises
second chloride process line is under
including JNMC and Pangang Group
Rutile TiO2 capacity expansion is on-
construction and proceeding smoothly.
even have attempted to acquire titanium
going in 2009. Besides rutile TiO2
In the coming years, capacity expansion
ore exploitation rights abroad. But
manufacturers expanding capacity,
will continue in China and TiO2
JNMC’s failure indicates that domestic
many anatase TiO2 manufacturers are
production will be more environmentally
enterprises may still have long way to go
shifting to rutile TiO2 production or
friendly.
Profitability to shrink in Q1 2010
W
ith TiO2 demand entering a slack season, TiO2 price
in Q3 2009, up 91.5% over Q2 2009 and experienced increase
has dropped gradually since November 2009, which
of its unit profitability by USD 0.007.
will impair TiO2 manufacturers’ profitability in the short term, despite the huge profit manufacturers have gained in
Besides huge domestic profit margins, export value of TiO2
past few months.
manufacturers’ also rose.
Driven by soaring domestic demand and price hikes initiated
Export price increased by 4.9% and 2.3% for rutile and anatase
by multinationals, domestic TiO2 price (FIGURE 4) went up
TiO2 respectively during Jul. ~ Oct. 2009. However, TiO2
gradually from Jun. ~ Oct. 2009, during which domestic ex-
sales volume does not seem to be affected by the price surge.
factory prices increased by 8.9% for rutile TiO2 and 5.7%
On the contrary, some manufacturers’ TiO2 export volume
for anatase TiO2. Though there may be lots of room for
has increased through entry into new markets. Take Henan
negotiation, prices in actual deals have indeed risen. For
Billions for example, its average export price increased from
instance, the export price (FIGURE 4) increased by 4.9% and
USD1,621/t in June to USD1,758/t in October, but its monthly
2.3% respectively for rutile and anatase TiO2.
export volume also rose from 1,674 tonnes to 2,067 tonnes over the same time period. This achievement is attributed to
TiO2 manufacturers have gained huge profits in the domestic
Henan Billions’ strengthened efforts in its new markets in
market in the past few months. Take Anhui Annada for
Kazakhstan, Columbia, etc, in H2 2009.
example, benefiting from booming demand and soaring prices, it gained USD16.84 million sales value from its TiO2 business CCM International Limited
Increases in export price and volume jointly contributed to
12
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TiO2 China Monthly Report FIGURE 4: TiO2 price, Jun. ~ Dec. 2009
Henan Billions’ monthly export value
2,100
increased from USD2.71 million in
1,950
34.3%.
1,800 1,650
Accordingly, even taking the increased
Exfactory rutile
production cost into consideration, the
Exfactory anatase
No
be r De ce m
ve m
be r
er ct ob
e Ju n
about USD 40/t.
O
1,200
pushed up production cost of TiO2 by
be r
June and October (FIGURE 5), it only
em
1,350
Se pt
25.0% and 4.0% respectively during
gu st
1,500
and titanium ore also increased by
Au
Besides, though prices of sulfuric acid
USD/t
June to USD3.64 million in October, up
Ju ly
a soaring export value. For instance,
Vol.2 Issue 12.2009
Export rutile
Export anatase
profitability of TiO2 business increased Note: ex-factory price is usually higher than price in actual deals as there may be certain room by about USD50/t during June-
for negotiation. Source: CCM International
October. FIGURE 5: Prices of titanium ore and sulfuric acid, Jun. ~ Dec. 2009
entering a slack season because of
120
the coming Spring Festival, TiO2
105
November 2009 and are likely to
90
production cost will jointly shrink the
ec em D
N
ov em
be r
be r
er ct ob
Sulfuric acid
O
Hence, price downturn and rising
Se pt
future.
A
production costs of TiO2 in the near
30
be r
raw material prices will push up
45
em
cost, as well as the gradual rise of
60
ug us t
electricity price and transportation
75
e
In addition, possible increases in
Ju n
keep declining throughout Q1 2010.
USD/t
prices have dropped slightly since
Ju ly
Nevertheless, with TiO2 demand
Titanium concentrate ore
Source: CCM International
profitability of TiO2 manufacturers in Q1 2010.
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