In 2020, the price of titanium dioxide can be divided into three stages:
The first stage is the stable upward stage: Due to the increase in costs and the sharp increase in exports, the price of titanium dioxide has been stable and rising in January and February, and the market price has increased by 500 yuan/ton; at the end of March, due to the spread of the global epidemic, the export of enterprises was blocked, and some enterprises in the market made concessions at the end of March;
The second stage is the panic decline stage: the price fell frequently in April, and the market price fell by about 3,000 yuan/ton in June. The market price fell too fast, and some prices have been in loss. Enterprises reduced production. As market demand gradually recovered, the price stopped falling at the end of June;
The third stage is the continuous upward stage: Due to the recovery of exports, the recovery of domestic demand and the sharp increase in costs, the price of titanium dioxide has continued to rise since July.
As of mid-December, the market price has risen by 4,000 yuan/ton compared with the mid-year low, an increase of 30%, and 1,000-1,500 yuan/ton higher than the same period last year, an increase of 7%.
- Capacity and output analysis
Capacity: According to statistics from Tuduoduo, China’s titanium dioxide production capacity in 2020 was 4.03 million tons, accounting for 49% of the global titanium dioxide production capacity, and China’s share of the global titanium dioxide market is gradually expanding.
The top three regions in China’s titanium dioxide production capacity are Sichuan, Shandong, and Henan, accounting for 19%, 16%, and 13% of the country’s total production capacity, respectively.
Output: According to statistics from Tuduoduo, China’s titanium dioxide production from January to November was 3.1662 million tons, which is basically the same as the same period last year, and the annual output is expected to be 3.48 million tons;
Affected by the epidemic, the production of titanium dioxide enterprises was affected from February to March. Except for a significant decline in production in February, the production in other months increased to varying degrees;
In the second quarter, due to low prices, the market was insufficient, but due to the release of new production capacity this year, the overall output has increased;
This year’s new production is mainly new production capacity release, Longmang Billions, China Nuclear Titanium Dioxide, Shandong Dongjia, Guizhou Shengwei, etc.
Chlorination process: There are 4 chloride titanium dioxide production enterprises (Longmang Billions, CITIC Titanium, Pangang Vanadium Titanium, Yibin Tianyuan), with a total capacity of 485,000 tons, accounting for 12% of the total domestic capacity, of which Longmang Billions accounts for 74% of the entire chloride capacity.
With the release of the capacity of the chloride titanium dioxide project and the resumption of production by Longmang Billions, the output of chloride titanium dioxide has increased significantly this year. From January to November, the output of chloride titanium dioxide was 285,700 tons, an increase of 112,100 tons over the same period last year, an increase of 64.54%, accounting for 9% of the total domestic output. Pictures Under construction and planned to be built: According to incomplete statistics, there are more than 20 companies under construction and planned to build titanium dioxide enterprises in the market, with a total capacity of more than 2 million tons. In 2021, it is planned to have 420,000 tons of new capacity put into production (including sulfuric acid method, chlorination method, and hydrochloric acid method). III. Import and export analysis
Import data: From January to October this year, the import volume of titanium dioxide was 139,700 tons, an increase of 3.08% year-on-year, and the annual import volume is expected to be 170,000 tons; the average monthly import volume was 14,000 tons, the import volume in January this year was less than 10,000, and the import volume reached 17,900 tons in February.
The top three regions for China’s titanium dioxide imports in 2020 were Taiwan, Mexico, and Australia, accounting for 29%, 20%, and 17% respectively.
Export data: At the beginning of the epidemic in the first quarter, some overseas buyers were worried about the spread of the epidemic in China and increased their orders. The export volume of titanium dioxide in March also hit a record high.
With the spread of the epidemic abroad, foreign closures, suspension of work and production and other measures have had a significant impact on the transportation and terminal market consumption of products. Exports began to decline in April, and exports in May were also at the lowest level this year. With the control of the epidemic, the export market has rebounded since June, and prices have also begun to recover from the bottom.
The annual export volume from January to October is already at the same level as the same period last year, and it is expected that the export volume this year will increase by more than 200,000 tons. Under the control of the epidemic, it is expected that China’s titanium dioxide export market will continue to maintain a good trend in 2021 and maintain steady growth.
The top three export countries from January to October 2020 were India, Brazil, and South Korea, accounting for 11%, 8%, and 6% respectively.
The top ten export countries have all increased to varying degrees:
IV. Apparent consumption analysis
According to Tuduoduo data, China’s apparent consumption of titanium dioxide from January to October was 1.9786 million tons, an increase of 3.8% over the same period last year.
V. Downstream coating market analysis
The impact of the epidemic is reflected in the large differences in different downstream industries of titanium dioxide. During the epidemic, there was strong demand for home decoration and construction coatings, while industries such as automotive paints continued to perform poorly.
This year, the performance of the engineering coatings business of Nippon Paint, Carpoly, Bardez, Maydos, GUC Energy Saving, Oriental Yuhong and other companies in the first three quarters also achieved growth. The substantial increase in the output of engineering and architectural coatings slowed down the decline in the output of the entire coatings industry.
According to news reports, at the 2020 China Green Coatings Painting Exchange Conference on November 11, Liu Jie, acting secretary-general of the China Coatings Industry Association, said that from January to September 2020, my country’s coatings production totaled 17.5359 million tons, a year-on-year decrease of 1.5% from 17.7987 million tons in the same period last year; as of the end of September this year, the production of most companies has exceeded 10%-18% of the same period last year. The rapid warming nodes of the downstream market are basically at the junction of the second and third quarters, which is also the post-stabilization period of my country’s epidemic prevention and control. The market effect is transmitted to the coatings industry. At the end of September, the overall output and profit of the entire industry basically caught up with the same period last year, and the main business income recovered relatively slowly. Overall, the overall production and operation of the industry at the end of 2020 is expected to be the same as the same period last year.
VI. Market Forecast in the Later Period
With the control of the epidemic, the demand for titanium dioxide at home and abroad has also recovered. The market demand for titanium dioxide will increase in 2021. The supply of raw titanium ore is tight and the price will continue to remain high. It is estimated that the price range of rutile titanium dioxide in China in 2021 will be 15,500-18,000 yuan/ton.