NEW YORK, Dec. 17, 2016 /PRNewswire/ -- In July 2016, the upward trend of TiO2 prices in China has begun to slow. Price rises have only come from a few manufacturers in Sichuan Province, mainly supported by the prosperous export market early this month. According to CCM, the price of TiO2 may stop rising in Aug., and may even decline given that overcapacity may worsen due to the gradually increasing operating rate of the industry.
Market dynamics of titanium products in July 2016:
Ilmenite: Stimulated by consecutive TiO2 price rises, prices of ilmenite, mainly produced in Sichuan Province, keep increasing. However, ilmenite manufacturers' profitability has not improved essentially due to bigger price growth margins of raw materials and also because of the increasing production costs brought by the rainy season. As a result, the operating rate of the industry is only up slightly, not enough to alleviate tight supply.
Titanium slag: The market price of acid dissolved titanium slag continues to grow, as does the operating rate. However, the high titanium slag market remains stagnant, with the market price and the operating rate being low.
Imports &exports of TiO2 in May 2016:
China recorded MoM increases in the volume of both imports & exports of TiO2. The export volume in particular was the highest it had been for the last five years, signifying that the export market had played an important role in the de-stocking of Chinese TiO2 enterprises. CCM believes that this can be attributed to the continuous depreciation of the Yuan recently and domestic enterprises' initiative in enlarging their export volumes.
Company dynamics:
On 8 July, 2016, Henan Billions announced its plan to shutter TiO2 production capacity equivalent to 20% of its annual output this year in response to the Energy Consumption Limitation for Titanium Dioxide Product, a regulation which is to be implemented soon. CCM believes that the elimination of this capacity will optimise Henan Billions' product structure and improve its profitability.
On 15 July, 2016, Pangang Vanadium Titanium issued an announcement, estimating that it had lost USD120.31 million-150.38 million during H1 2016. In order to prevent being delisted due to sustained losses, seven days after issuing the announcement, the company declared that it will sell most of its assets, including its iron ore and titanium sponge businesses.In May 2016, China recorded MoM increases in the volume of both imports & exports of TiO2. The export volume in particular was the highest it had been for the last five years, signifying that the export market had played an important role in the de-stocking of Chinese TiO2 enterprises. This month the gap between import volume and export volume widened from 47,518 tonnes in April to 59,861 tonnes, and the difference between import price and export price increased from USD831/t to USD878/t.
In May 2016, China's import volume of ilmenite continued to fall, with volumes from India and Russia recording the most significant drops. The domestic market continued recovering from the last month, and the price of ilmenite rose slightly in Sichuan Province.
In July 2016, the upward trend of TiO2 prices in China has begun to slow. Price rises have only come from a few manufacturers in Sichuan Province, who raised quotations early in the month. The operating rate of the TiO2 industry continues to recover. In the meantime, the domestic acid dissolved titanium slag and ilmenite markets are showing upward trends, while the high titanium market remains stagnant.
On 29 June, 2016, Anhui Annada announced a further investment of USD3.16 million (RMB21 million) in its subsidiary, Nayuan Material, to expand its iron phosphate production capacity. According to CCM, China's new energy industry has skyrocketed since 2015 and the industry's phenomenal growth is the main driving factor behind Anhui Annada's further investment. However, on the basis that frequent investments have been made in the market recently, and will continue to be made, overcapacity in the future seems probable, and profits are liable to be lower than expected following several years of development.
On 6 July, 2016, Huntsman announced that it will be closing its 25,000 t/a TiO2 manufacturing facility based in Umbogintwini, South Africa in Q4 2016. CCM believes that this will not only improve the company's profitability, but also help to boost the global TiO2 price. In addition, CCM is of the opinion that production capacity reductions from successive international TiO2 manufacturers are conducive to China's export market.
On 8 July, 2016, Henan Billions announced its plan to shutter TiO2 production capacity equivalent to 20% of its annual output this year in response to the Energy Consumption Limitation for Titanium Dioxide Product, a regulation which is to be implemented soon. CCM believes that the elimination of this capacity will optimise Henan Billions' product structure and improve its profitability.
On 15 July, 2016, Pangang Vanadium Titanium issued an announcement, estimating that it had lost USD120.31 million-150.38 million during H1 2016. In order to prevent being delisted due to sustained losses, seven days after issuing the announcement, the company declared that it will sell most of its assets, including its iron ore and titanium sponge businesses. However, the to-be-sold assets are all businesses which have been generating long-term losses. Therefore, CCM expects that it will be hard for Pangang Vanadium Titanium to achieve the desired result by selling these assets alone.
On 17 July, 2016, Henan Billions announced that it had reached an agreement with graphene manufacturer Allightec on long-term cooperation in the new materials field. CCM believes that to enter the new materials industry will not only be conducive to Henan Billions' R&D in diversified and high-end TiO2 products, but also bring potential profit growth to the company despite the current immaturity of graphene industry development in China.
In July 2016, China called for a thorough overhaul of mined-out areas in subsurface metal and nonmetal mines around the country, and requested that complete records of said areas be kept. This new regulation also pertains to titanium ore, the most upstream product of TiO2. The regulation will not only restrict the disorganized mining activities of small- and mid-sized ore manufacturers, but also help to promote an environmentally friendly mining technology - block caving.
On 4 July, 2016, the China National Coating Industry Association disclosed that China's total coating output had increased to 6.70 million tonnes between Jan. and May this year, supporting the domestic TiO2 market. Meanwhile, according to CCM's research, product diversification within the Chinese coating industry is quickening pace under the influence of increasing production costs and policy reform.
Read the full report: http://www.reportlinker.com/p04037703-summary/view-report.html
About Reportlinker
ReportLinker is an award-winning market research solution. Reportlinker finds and organizes the latest industry data so you get all the market research you need - instantly, in one place.
http://www.reportlinker.com
__________________________
Contact Clare: [email protected]
US: (339)-368-6001
Intl: +1 339-368-6001
SOURCE Reportlinker
Related Links
WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM?
Newsrooms &
Influencers
Digital Media
Outlets
Journalists
Opted In
Share this article