1. Higher cost, better domestic and foreign demand, waiting for Titanium Dioxide to rise for the sixth time in the year
1.1 price increase of titanium dioxide in 2020-2021
In the first ten days of 2020, affected by the epidemic situation, domestic titanium dioxide and titanium ore manufacturers started to reduce the burden or stopped frequently, delaying the delivery time of some orders, making the domestic demand in the second half of the year more vigorous than in previous years; Poor control of overseas epidemic situation and shrinking supply of foreign manufacturers further boosted China's titanium dioxide export. In 2020, China's titanium dioxide export volume was 1.214 million tons, up 21.0% year on year. From the perspective of raw material side, the production capacity of titanium dioxide increased during the year, but the limited increment of titanium concentrate led to the increase of ore price, so the cost side also gave strong support to the price of titanium dioxide. Under the support of cost and supply and demand, the price of titanium dioxide began to rise significantly from the lowest point in July 2020, with the highest price of 16362.5 yuan / ton, with an amplitude of 30%, and the annual average price of 14025.4 yuan / ton, with a year-on-year increase of + 31.2%. However, affected by the high price of titanium concentrate, the average annual gross profit of titanium dioxide plant before tax reached 1732.3 yuan / ton in 2020, Compared with RMB 3311.0/t in 2019, it was - 47.7% on a year-on-year basis.
In 2021, under the macro situation of global economic recovery, rising inflation expectations, continuous and rapid rise of commodity prices, and the industry background of low inventory, strong demand for downstream replenishment, and high cost, titanium dioxide manufacturers frequently send letters to increase prices, showing a strong trend in off-season, The domestic titanium dioxide market price is strongly supported by the supply and demand and cost side, and has ushered in five rounds of price increase. As of the closing of May 28, the domestic rutile titanium dioxide market price rose to 20578 yuan / ton, breaking through the historical high since the beginning of 2016, with a year-on-year increase of 25.8%, monthly average price of + 48.4% and annual average price of + 31.4%.
We sort out the five rounds of price increase of titanium dioxide so far: before New Year's day, some domestic small and medium-sized titanium dioxide manufacturers started the price increase mode. On January 1, overseas manufacturers increased the international price of titanium dioxide by US $100-150 / ton; On January 8, lomon Billions announced that on the basis of the original price, the company's sales price of various types of titanium dioxide increased by 500 yuan / ton for domestic customers and 100 US dollars / ton for international customers. The letter from leading enterprises officially opened a new round of rising cycle of titanium dioxide price. Since late January, the overall supply level of rutile titanium dioxide has been low. Although the inventory has increased slightly, the recovery of logistics after the festival has driven the inventory to return to a low level at the end of the month. At the same time, the supply of foreign manufacturers has become tight, and some factories in tenor have been shut down for a short time; The overall domestic demand is mainly rigid demand, and some imported products are listed until the middle of this year. On January 29,Taihai issued a price increase letter to start the second round of price increase. The price increase letter issued by Lomon Billions on February 8 confirmed this round of price increase, laying an expectation for a new round of titanium dioxide price increase just supported by demand after the year.
In March, the third and fourth round of price increases officially began: on March 1, sporadic manufacturers sent letters to announce price increases, with the increase of 800 yuan / ton or more. Most of the manufacturers did not participate in the round of price increases around the Spring Festival, and most of them were anatase type; On March 2, several manufacturers sent letters to announce the price increase, among which Taihai announced a price increase of 1500 yuan / ton, and then directly quoted the price to 20000 yuan / ton; From the end of March to the middle of April, major manufacturers successively issued the fourth round of price increase letters for titanium dioxide in the year. More than 20 domestic and foreign manufacturers announced the price increase successively. The price of titanium dioxide increased by 1000-1500 yuan / ton. In addition, on March 31, Chemours announced that the sales price of titanium dioxide in China increased by 200 US dollars / ton, which opened the prelude to the overall price increase of domestic enterprises in May.
In May, several major titanium dioxide listed companies once again issued a new round of price adjustment letters. More than ten manufacturers sent letters to announce a rise of 1000 yuan / ton. In addition, several manufacturers in Southwest China and other regions went up 800-1000 yuan / ton without letter, continuing the favorable atmosphere of the market. On May 6, CNNC titanium dioxide announced an increase in the sales price of 1000 yuan / ton for domestic customers and 150 US dollars / ton for international customers. Jinpu titanium and annada followed up at the same time. On May 10,Lomon Billions officially sent a letter to share the same price rise. The industry set off the fifth round of price rise this year. In the middle of May, foreign manufacturers fannengtuo and Connors sent letters to announce that the price of titanium dioxide in the third quarter will be increased by US $200 / T and US $300 / T, which will be implemented from July 1. On May 31, Chemours sent letters to announce that the price of titanium dioxide in the third quarter will be increased by US $200 / T, which may be beneficial to the export of domestic manufacturers in the third quarter.
1.2 low inventory, high cost, titanium dioxide will meet the sixth price increase in this year
From January to April 2021, there is no new production capacity of titanium dioxide. The output of titanium dioxide is 1.268 million tons, with a year-on-year increase of + 23.2%. The industry operation rate has continued to rise since January, with the highest value of 91.4%. It has dropped slightly in April, with a month on month decrease of 2.8 percentage points; Since 2021, the year-on-year decline of social inventory and factory stock has been expanding. Since April, the weekly social inventory and factory stock have remained below 30000 tons. The industry basically has no inventory, and the spot has continued to be tight.
From January to April, the cumulative export volume of titanium dioxide turned positive, and the cumulative import ratio reached 31.5%. Since 2020, the demand for titanium dioxide at home and abroad has been significantly boosted, and the export volume of titanium dioxide in 2020 was 1.214 million tons, with a year-on-year increase of + 21%. In April 2021, the monthly export volume of titanium dioxide was 107000 tons, which was - 15.5% on a month on month basis and + 21.6% on a year-on-year basis. The average export price was 2697 US dollars per ton. If it is expected to rise to 2700 US dollars, it is in line with the rhythm of price adjustment. The cumulative export volume in the year was 435000 tons, which was + 3.6% on a year-on-year basis; In April, the import volume was 19000 tons, with the year-on-year changes of + 15.6% and + 52.1% respectively. The average import price was US $2956 / ton. Most of the imported products were high-end chlorination products, and the unit price was higher than that of export. The cumulative import volume from January to April was 65000 tons, with a year-on-year increase of + 31.5%.
In 2021, domestic and foreign ore prices continue to rise: at present, domestic titanium ore prices continue to rise, and sulfuric ACID prices vary from place to place. Since the beginning of this year, the production cost of titanium dioxide continues to rise. At the end of May, the production cost of titanium dioxide is about 15761 yuan / ton, up 15.8% over the beginning of the year. As of May 29, 46% of the mainstream quotations of 10 mines were 2430-2450 yuan / ton, 47%, 20 mines were 2500-2550 yuan / ton, 38% - 42% of the mainstream quotations of titanium middlings were 1680-1700 yuan / ton, up 40 yuan / ton from the beginning of the month and 500 yuan / ton from the beginning of the year. At present, the bullish expectation of the domestic ore market is enhanced, and the import miners will not offer for the time being. Affected by the early environmental supervision, the concentrators in Panxi area have not reached the continuous full open state after the resumption of work, and the market supply has remained stable and tight after a small increase. From January to April this year, the total import volume of titanium concentrate in China was 1.394 million tons, a year-on-year increase of + 37.5%. In the first quarter, the cumulative import volume increased by 31.2% year-on-year. In April, the import volume was 367 thousand tons, a year-on-year increase of + 59.0%. The import ore price rose significantly in March and April, a year-on-year increase of + 42.2% and 54.1%. The continuous shortage of containers will affect the future import ore supply.
At present, the start-up of manufacturers in May is affected by environmental protection supervision and factory maintenance. The start-up is unstable. The demand side is supported by a large number of orders on hand. The tense situation of spot supply in the domestic market has not improved significantly. The delivery time of the latest orders of major manufacturers, including foreign trade, has covered the middle of July, but affected by the continued high price, Since April, the new single access volume has shown a marginal decrease, and the manufacturers have also expressed their concern about the sustainability of the subsequent new price orders. The problem of production line shutdown caused by the epidemic in large foreign factories has been basically alleviated. Brazil's tenor factory has resumed production. Komo's factory in Taiwan, China is currently at full capacity. However, during this period, there may be a load drop caused by water resources problems, and the start-up of other production bases is expected to be further improved. We believe that the price of titanium dioxide will increase in a narrow range in June, but it will be mainly supported by cost and supplemented by supply and demand.
2 large demand space, titanium raw material supply tension pattern may continue in the medium term
2.1 domestic titanium ore is characterized by large reserves, low abundance, high import dependence and centralized supply
Titanium is known as "modern metal" and "strategic metal". It is an indispensable strategic material for improving the level of national defense equipment. It is an important metal for industrial production in the 1950s. With excellent properties and abundant reserves, it is known as the rising "third metal", The process of titanium industry can be divided into two paths: one is to produce high purity titanium tetrachloride with ilmenite or rutile as raw materials, and then use magnesium as reducing agent to reduce titanium in titanium tetrachloride to obtain sponge titanium; The other is to directly process raw materials to obtain titanium dioxide. At present, 90% of titanium in the world is used to produce titanium dioxide, only 4% is used to produce sponge titanium, and 6% is used in other aspects.
Titanium mineral deposits can be divided into rock deposits and sand deposits. Rock deposits are igneous rock deposits with the characteristics of concentrated deposits and large reserves. The main minerals of this kind of deposits are ilmenite, titanomagnetite, etc; Placer titanium deposit is a secondary deposit, which is formed by weathering and stripping of rock deposit and then scouring and enrichment by water flow. The minerals include rutile, sandy ilmenite, brookite, perovskite, etc. In terms of reserves, according to USGS data, the global reserves of ilmenite and rutile (in terms of titanium dioxide) in 2020 are 740 million tons, of which ilmenite is about 700 million tons.
China's titanium resources are mainly ilmenite, mainly composed of vanadium titanomagnetite. The current economic reserves are about 230 million tons, accounting for 31.0% of the global total reserves, ranking first in the world; Australia followed closely, ranking second with 180 million tons of ilmenite and rutile reserves, accounting for 23.9% of the world's total reserves.
Vanadium titanomagnetite has a low grade, so it needs to be mined before titanium concentrate can be obtained. In the process of vanadium titanomagnetite mining, the waste rock should be removed from the mined ore to get the raw ore. after grinding and low intensity magnetic separation, the iron concentrate can be obtained as the raw material of iron and steel industry, and then the high intensity magnetic separation and flotation methods can be used to separate titanium from the remaining iron tailings to get titanium concentrate and sulfur cobalt concentrate, Finally, the titanium concentrate enters the titanium industry, and the sulfur cobalt concentrate is used for making acid or other industries.
The low abundance of titanium resources increases the external dependence of China's Titanium Resources: because most of China's titanium resources exist in the form of vanadium titanomagnetite, which is difficult to mine, and the grade is low, a large number of imports are still needed every year. According to the statistics, in 2019, China's titanium concentrate production capacity is about 5.2 million tons / year, and the production capacity is about 5 million tons, with a year-on-year growth of 17.1%, and the capacity utilization rate is more than 90%; The output of Panxi area is 3.775 million tons, accounting for 75.5% of the total domestic output; The import of titanium concentrate reached 2.5 million tons, and the import dependence decreased slightly, from 40.7% in 2018 to 34.3%. In 2020, the import volume of titanium concentrate in China will be 3.014 million tons, with a year-on-year growth of 15.3%. The domestic production volume of titanium concentrate will be 6.33 million tons, with a year-on-year growth of + 26.6%. The import dependence will continue to drop by 2.1 percentage points.
Due to the large reserves of rutile in Mozambique, Australia, Vietnam and other places, China's imports of titanium ore mainly come from these countries, of which Mozambique accounts for the largest proportion. From January to April this year, China's total imports of titanium concentrate were 1.394 million tons, with a year-on-year increase of + 37.5%, of which about 37.7% came from mosanbic.
Titanium raw materials are relatively concentrated, with domestic Cr5 as high as 75%. According to the data of Anning stock's prospectus, China's titanium resources are mainly concentrated in Sichuan, and some are distributed in Hubei, Shandong and other places, and the supply pattern of titanium ore is relatively concentrated.
The incremental release progress of domestic titanium concentrate is slow, and the cost will be a strong support for the high price of titanium dioxide: from 2021 to 2022, the new production capacity of titanium dioxide will be 370000 tons and 1085000 tons, and the corresponding new demand of titanium concentrate will be 851000 tons and 2496000 tons according to the consumption of 2.3 tons. From January to April 2021, the cumulative import volume was 1.394 million tons, and the cumulative import volume in the first quarter increased by 31.2% year on year. Considering the base effect, the high start-up of titanium dioxide industry in the first half of the year and the release of b-end demand, we assume that the import volume of q2-q4 increased by 20% year on year, that is, the annual import increment of titanium concentrate was 842 thousand tons. According to the data of grassroots research, in 2021, domestic manufacturers may add about 400000 tons of production capacity, and the gap is expected to be met, but there is no news about the release of new production capacity at present; In terms of overseas ore sources, Kenya's contingent titanium concentrate will reach the annual output target of 300000 tons in 2-3 years, Mozambique's contingent titanium concentrate will increase by about 400000 tons in this year, a Hong Kong, Macao and Taiwan enterprise may increase by about 200000 tons, and in the medium term, it is estimated that there will be an overseas concentrate increase of about 900000 tons, However, considering the impact of overseas epidemic and trade relations on imports, as well as the shipment and circulation of domestic sources of goods, we are still optimistic about the supporting role of medium-term cost on the price of titanium dioxide.
2.2 global titanium raw material supply continues to be tight
The global titanium raw material supply is concentrated, and the output will be reduced in 2020: after the successful acquisition of Coster by KRONOS, the global titanium raw material supply concentration will be further improved, mainly concentrated in Rio Tinto,KRONOS, iluka, kemel, tizir and other companies, with Cr5 reaching 54%. According to the statistics of titanium raw material data of Rio Tinto, iluka, Kenmare, baseresource and other manufacturers, we think that the output of titanium raw material has recovered in the first half of 2020, but since the second half of 2020, the supply of titanium raw material has been significantly reduced due to the impact of the epidemic. Take Rio Tinto as an example, due to the decline of market demand and the operation interruption of Richards Bay mining company in 2020, the output of titanium slag of the company is - 7.1% year-on-year.
In 2021, although the overseas epidemic repeatedly affected some titanium raw material industries, the companies in the industry took different actions, and the number of new crown cases of Kenmare company continued to rise. However, the company still set the production target of ilmenite in 2021 at 1.1-1.2 million tons, that is, + 45% - 60% year on year, Iluka pointed out in the review of the first quarter of 2021 that as Sierra rutile's performance continued to be lower than expected, it planned to suspend its production business in Sierra rutile from November 19 this year, and the plan of Sierra rutile's output of 145000 tons in 2021 was cancelled.
3. Process reform accelerates the progress of industry reshuffle, and the industry concentration needs to be improved
The chemical name of titanium dioxide is titanium dioxide, the commercial name is titanium dioxide, and the chemical formula is TiO2. Titanium dioxide has high refractive index, ideal particle size distribution, good covering power and coloring power. It is a kind of white pigment with excellent performance. It is widely used in coatings, rubber, plastics, paper making, printing ink, daily chemical industry, electronic industry, micro electro mechanical and environmental protection industry.
Titanium dioxide can be divided into pigment grade and non pigment grade according to the purpose of use. Pigment grade titanium dioxide can be divided into anatase type titanium dioxide (a type) and rutile type titanium dioxide (R type) according to crystal morphology. Anatase titanium dioxide is mainly used in interior coating, ink, rubber, glass, cosmetics, soap, plastic and paper industry. Rutile titanium dioxide has better weatherability and covering power than anatase titanium dioxide. It is mainly used in high-grade outdoor coating, bright latex coating, plastic, rubber material with higher achromatic power and weatherability requirements, high-grade paper coating, etc. Non pigment titanium dioxide can be divided into enamel titanium dioxide, electrode titanium dioxide, ceramic titanium dioxide, electronic titanium dioxide and other types according to its main use.
According to the data of USGS, in 2020, the global capacity of titanium dioxide is about 8.4 million tons / year, and the capacity of titanium dioxide in China accounts for 47.6%; According to the production process, sulfuric acid process and chlorination process account for 43% and 57% respectively. Sulfuric acid production capacity is mainly concentrated in China, and chlorination process is the main process in European and American countries.
3.1 process end: chlorination process will gradually replace sulfuric acid process and become the mainstream titanium dioxide production process in China
3.1.1 titanium dioxide production process sulfuric acid method
In 1916, sulfuric acid titanium dioxide was first industrialized in Europe, and now it is the most mature titanium dioxide production process. Ilmenite and acid soluble titanium slag can be used as raw materials for sulfuric acid process, and the products can be divided into anatase type and rutile type. Sulfuric acid process is mainly divided into the following processes: raw ore preparation, preparation of titanium sulfate solution by decomposing concentrate with sulfuric acid, purification of solution to remove iron, analysis of metatitanic acid from titanium sulfate solution water, calcination of metatitanic acid to produce titanium dioxide and post-treatment process.
Sulfuric acid process is a relatively backward process, which uses non continuous production, the process is complex, needs more than 20 process steps, and discharges more waste. The crystal transformation needs more operation steps, and the incineration process needs a lot of energy. Due to the gradual improvement of environmental protection requirements, the production process of titanium dioxide produced by sulfuric acid method in European and American countries gradually withdrew from the market. However, papermaking, chemical fiber, enamel, cosmetics and other industries still maintain a strong demand for titanium dioxide produced by sulfuric acid method, which also provides a living space for domestic titanium dioxide.
Anatase and rutile titanium dioxide can be produced simultaneously by sulfuric acid process, but rutile is the main type. Anatase titanium dioxide particles are rough, unevenly distributed, relatively unstable and easy to yellowing. It is mainly used in interior coating products and industrial applications. Rutile titanium dioxide can be obtained from anatase titanium dioxide after calcination, but it needs a certain amount of energy for calcination, and the process is not continuous, which brings some inconvenience in the production process.
3.1.2 titanium dioxide production process chlorination method
Rutile titanium dioxide produced by chlorination process has controllable particle size and uniform distribution. It is mainly used for downstream high-end products, such as automobile paint, exterior wall paint, printing ink, etc. The research of chlorination method began in 1930s. DuPont company first realized industrialization in the United States. It mainly used ilmenite, high titanium slag, artificial rutile or natural rutile as raw materials, reacted with chlorine to produce titanium tetrachloride, purified by distillation, then carried out gas-phase oxidation, and obtained titanium dioxide through gas-solid separation after rapid cooling. The chlorination process can only produce rutile titanium dioxide products, and its production technology is continuous production process. Compared with the non continuous sulfuric acid process, the process is simple, the process control points are less, the product quality is easy to achieve optimal control, and the generation of waste is greatly reduced. In addition, the sintering process without rotary kiln calcination process is easy to depolymerize the titanium dioxide primary particles, Therefore, the energy consumption in the process of product refining is much less than that in sulfuric acid process. At present, more than 80% of overseas titanium dioxide production adopts chlorination process. In China, only CITIC titanium, lomon Billions, Pangang, Tianyuan and Yunnan Xinli have applied this technology. With the construction of new chlorination capacity in the future, it is estimated that the proportion of chlorination capacity in China will reach 19.5% in 2024, an increase of 7.9 percentage points compared with 2020.
Domestic environmental protection and policy requirements make chlorination become the future development trend of titanium dioxide industry
Compared with sulfuric acid method, titanium dioxide produced by chlorination has the advantages of higher purity, short process, small equipment, small floor area, high continuous operation efficiency, closed-circuit recycling of chlorine gas and less discharge of three wastes. In the face of the situation of the domestic environmental policy tightening, the chlorination method to make titanium dioxide has a huge space for replacing sulfuric acid method.
3.1.3 titanium dioxide production process hydrochloric acid extraction
The main process of hydrochloric acid extraction: hydrochloric acid extraction process takes ilmenite powder as raw material, dissolves ilmenite powder with hydrochloric acid, and then separates insoluble solid phase to get mixed solution of iron chloride and titanium dichloride. The high price iron in the decomposition solution is reduced to low-cost iron through NaCl 3. After cooling and crystallization, FeCl2 is separated. The titanium dioxide solution after separation is separated by solvent extraction solution. After extraction and purification, titanium chloride solution is purified by multiple extraction - reverse extraction, and some water is evaporated for concentration. Finally, titanium dichloride liquid rich in titanium is directly entered into titanium dioxide synthesis device, and then precipitated with sodium hydroxide solution, and then high quality titanium dioxide can be obtained after treatment. In the process of production, hydrochloric acid and extractant can be recycled and recycled, and by-product FeCl2 is recycled after roasting.
The by-product can be reused and hydrochloric acid extraction is cleaner and environmental protection: compared with traditional methods, titanium dioxide with hydrochloric acid has unique advantages. FeCl2 / FeCl3, the by-product produced in the process of titanium dioxide preparation, can be converted into Iron Oxide by hot water hydrolysis and then the hydrochloric acid can be returned to the main line of titanium dioxide production, which avoids the environmental protection pressure caused by the failure of ferrous sulfate, the by-product in the sulfuric acid process; In addition, the extractant can be recycled. Therefore, hydrochloric acid titanium dioxide is an environmentally friendly and clean production process.
The reason why hydrochloric acid extraction process is not widely used in industrial production is mainly due to the following problems:
1) The price of extractant is more expensive: the solid-liquid separation of iron and titanium different from sulfuric acid method and the liquid liquid separation of iron and titanium by chlorination are characterized by the separation of iron and titanium from ilmenite with organic extractant liquid. Therefore, solvent extraction is the key point of the process and the key to be breakthrough. The current use of organic phosphorus and organic amine extractants is expensive, and it is not suitable for process production.
2) High requirements for equipment: because HCl gas protection is needed in the acid hydrolysis process, it needs to be carried out in closed containers, and the traditional acid solution tank cannot be used, so it has certain requirements for the equipment.
3) High requirements for hydrochloric acid control: the consumption of hydrochloric acid is relatively large, and it is difficult to recover and balance the utilization of hydrochloric acid.
4) Titanium chloride concentration is difficult to guarantee: hydrolysis and acid solution exist at a certain temperature, titanium oxychloride will be hydrolyzed to titanic acid, the higher the reaction temperature will promote acid hydrolysis and hydrolysis, the higher the acidity will promote acid solution, and the reaction speed and titanium concentration cannot be considered simultaneously. It is difficult to guarantee the concentration of titanium oxychloride in the acid solution, which brings some difficulties to the next process.
Kuncai technology is the first enterprise in China to produce titanium dioxide by hydrochloric acid extraction method: on December 12th, 2020, Fujian kuncai technology started trial production of the first 100000 ton hydrochloric acid extraction titanium dioxide project, and also a 100000 ton iron oxide production line. After more than 10 years of R & D and pilot test, this project is the first extraction process construction project in the world with independent intellectual property rights of kuncai technology. In addition, the second article of kuncai technology is expected to be put into operation after the Spring Festival in 2021, and it is expected to reach the scale of 500000 tons of titanium dioxide, 500000 tons of iron oxide and functional titanium dioxide in 2022.
3.2 supply end: Cr4 in China is only 45.8%, and chlorination will become the mainstream technology in the future
3.2.1 tenor completed the acquisition of Coster, and the concentration of titanium dioxide overseas was further improved
Trono announced on april10,2019 that it took two years to complete the acquisition of Cristal titanium dioxide business and divest Cristal's North American titanium dioxide business to Ineos. Previously, Cristal's 8120 paper grade titanium dioxide has been stripped to Venator materials PLC. The combined production capacity of tnot titanium dioxide is 1078000 tons / year, becoming the second largest titanium dioxide production enterprise in the world after Chemours.
In 2020, the global capacity of titanium dioxide is about 8.4 million tons / year, of which 4.4 million tons / year overseas, mainly distributed in Europe and America, mainly by chlorination process, and the concentration of the industry is very high. With tronox completing the acquisition of Cristal, the overseas titanium dioxide production capacity Cr4 will rise from 70% to 80%, among which, the capacity of Chemours, tenor, Venator and KONOS is 125, 107.8 respectively 677 and 575000 tons.
