How strong is the upward momentum of titanium dioxide?

Not only price increases, but also out of stock! What chemicals are so crazy? It is the titanium dioxide that has recently "rising sound".

The market price of rutile titanium dioxide has risen from 12,000 CNY/ton at the end of June to about 13,000 CNY/ton-13,500 CNY/ton on September 30. Not only that, on October 9, China Nuclear Titanium Dioxide announced that it would raise the sales price of various types of titanium dioxide. Among them, the sales price for domestic customers is raised by RMB 800/ton, and the export price for international customers is raised by USD 150/ton.

"Many manufacturers have already closed for a few days. From last Sunday to the end of September, nearly 20 titanium dioxide manufacturers have sent letters to increase the price, ranging from 500 yuan to 1,000 yuan per ton." Zhuochuang Information Titanium White powder analyst Tian Xiaoyu told reporters from Shanghai Securities News that “increased pressure on raw material costs and continued tight supply have jointly contributed to this larger increase. While external demand continues to increase and domestic demand is in the peak season, this year’s gold Nine's fineness is more satisfactory. With the gradual recovery of downstream user production and terminal consumption of titanium dioxide,'Silver Ten' is also optimistic."

The price of upstream raw materials rises, and the export volume in August breaks 100,000 tons this year

On September 29, CITIC Titanium, which had just completed the listing guidance and filing, issued a price adjustment letter, which specifically stated that the price increase was affected by the rising prices of raw materials such as liquid chlorine, and the company's manufacturing costs continued to rise. From October 1st, the company will increase the domestic market titanium dioxide by 500 CNY/ton, overseas market titanium dioxide by 80 US dollars/ton, and refined titanium tetroxide by 200 CNY/ton.

It is understood that not only CITIC Titanium, but since September 25th, every day titanium dioxide manufacturers have sent letters to increase the price, ranging from 500-1000 CNY/ton. "Such frequent price increases are really rare. Several large leading companies will most likely issue price adjustment letters after the holiday." According to a market source.

"The second price adjustment in September was mainly due to the tight supply caused by the increase in upstream raw materials and the increase in export volume." Tian Xiaoyu said.

It is understood that the mainstream price of titanium concentrates in Panxi area has recently increased significantly, with an increase of about 100 CNY/ton. The Panxi region is mainly affected by weather and road transportation, and the titanium-medium ore spot in the trading market is tight. Since July, the price of titanium concentrate has risen by more than 20%, and there is a continuing upward trend. In addition, the raw material liquid chlorine in the chlorination method and the upstream raw material sulfuric acid of titanium dioxide in the vulcanization method have shown a certain degree of increase. According to agency statistics, the overall cost of titanium dioxide increased by about 550 CNY/ton.

September is the traditional peak season for titanium dioxide demand. With raw materials rising and the domestic operating rate basically stable, the export volume of titanium dioxide in the second half of the year increased significantly, resulting in a tight market supply.

According to the data provided by the General Administration of Customs, my country's titanium dioxide exports in August 2020 were 117,122.06 tons, an increase of 20.1% month-on-month and a year-on-year increase of 34.09%. The average export price of the month was US$1,786.35/ton. The cumulative export volume of titanium dioxide from January to August 2020 is 777,705.44 tons, and the cumulative average export price is 1964.46 US dollars/ton, an increase of 18.27% year-on-year.

In terms of imports, my country's titanium dioxide imports in August 2020 were 12,291.17 tons, a decrease of 15.83% month-on-month and 19.25% year-on-year. The average import price of the month was US$2,887.37/ton. From January to August 2020, the cumulative import volume of titanium dioxide is 104451.31 tons, and the cumulative average import price is 2884.15 US dollars/ton, a year-on-year decrease of 1.14%.

Related listed companies are expected to increase profits in the third quarter

On the demand side, with the increase in operating rates of downstream coatings and papermaking industries, domestic demand for titanium dioxide continues to rise. The worst period of overseas demand has also passed and is gradually improving. Manufacturers' inventories are in a tight state, pushing the price of domestic titanium dioxide to rise. The price of titanium dioxide is expected to continue to rise in the second half of the year.

On the production side, cost pressures and tighter market supply, the two main factors driving price increases in the second half of the year, will not change in the short term.

Yan Taiyun believes that a leading company has recently received a large foreign trade order of 10,000 tons. The priority of export orders was originally higher, and the domestic spot market may become more tense in the future. In addition, the Sichuan factory's spot is already very tight, and the Hubei factory is also in the routine maintenance cycle. Judging from the tight spot situation of the leading companies in the industry, there is still a large possibility of continued increase, and the increase has a tendency to increase. Southwestern large enterprises temporarily shut down their two production lines due to equipment failures. The original tight spot market may become more serious. In terms of cost, the price of titanium concentrates in Panxi region is still rising.

On September 30, the A-share titanium dioxide sector strengthened overall.

The domestic titanium dioxide industry has a large gap in scale. The first to third places in production capacity are 1.01 million tons/year (Lemon Baili), 400,000 tons/year (China Nuclear Titanium Dioxide), and 240,000 tons/year (Pangang Titanium Dioxide). industry). Minsheng Securities believes that since the third quarter, the downstream real estate and other infrastructure of titanium dioxide have recovered significantly, driving a significant increase in demand for titanium dioxide. The price of titanium dioxide is currently experiencing a third round of significant increases, and it is expected to continue to rise in the future. As the price of titanium dioxide rises, many companies gradually break away from the cost line to achieve profitability, which will have a positive impact on the annual performance.

Lomon Baili: Proposed rotor-grade titanium sponge project

On September 28, Lomon Baili issued an announcement that the company's holding subsidiary Yunnan Guotitanium Metal Co., Ltd. planned to build a 30,000-ton rotor-grade titanium sponge intelligent manufacturing technology transformation project. Lomon Baili said that the implementation of the project will enrich the company’s titanium product series, relying on the company’s existing industrial chain, further leverage the company’s scale advantages, enhance the company’s position in the titanium industry, and promote the company’s titanium concentrate-chlorination Optimization and upgrading of the entire industrial chain of titanium slag-chlorination titanium dioxide-sponge titanium-titanium alloy.

CNNC Titanium Dioxide: It is planned to raise 1.6 billion yuan for the 200,000 tons/year titanium dioxide post-processing project

On September 27, China National Nuclear Titanium Dioxide announced that the total amount of funds to be raised will not exceed 1.6 billion yuan. After deducting the issuance costs, the net proceeds will be used for the 200,000 tons/year titanium dioxide post-processing project and supplementary working capital. Previously, the company stated on the investor interaction platform that product price adjustments have a positive effect on both the third-quarter performance and the company's later development.

Ananda: The output of titanium dioxide and other products hit a new high for two consecutive months

Anada said that the output of rutile titanium dioxide and iron phosphate in September reached a new high after breaking through the best results in history in August, reaching 7755 tons and 1,185 tons respectively. Among them, rutile titanium dioxide was 327.45 tons more than last month, and iron phosphate was 7.44 tons more than last month. This is the company's two consecutive months of production record high since November 2016.

Huiyun Titanium Industry: Will continue to develop high-end titanium dioxide market

On September 17, Huiyun Titanium officially listed on the Growth Enterprise Market. The prospectus shows that the company's current production capacity and output scale are at the upper-middle level of the domestic industry. The current production capacity of titanium dioxide is 65,000 tons/year, and it has a certain market share in some mid-to-high-end product applications.

Based on the company's product and business development, Huiyun Titanium intends to invest 201 million yuan to raise funds for the "80,000 tons/year plastic-grade rutile titanium dioxide post-processing reconstruction project". The project uses rutile products as raw materials to increase the production capacity of the company's high-end rutile titanium dioxide products, and upgrade the company's high-end titanium dioxide production capacity from the original full production of 50,000 tons/year to 130,000 tons /year.