Price Analysis of China's Titanium Dioxide Market in 2023

In 2023, the Chinese titanium dioxide market experienced four stages of ups and downs. The year-end price of titanium dioxide was still higher than the beginning of the year, while the price of rutile type titanium dioxide increased by about 1000 yuan/ton, an increase of 6%. The price of rutile type titanium dioxide increased by about 500 yuan/ton, an increase of 4% compared to the beginning of the year. As of the end of the year, the factory price of China's rutile type titanium dioxide, including taxes, was between 15200 and 16300 yuan/ton, The ex factory price of rutile titanium dioxide, including taxes, ranges from 13600 to 14200 yuan/ton. The highest market price for the year occurred in October, with a monthly average price of 16918 yuan/ton. The lowest market price occurred in January, with a monthly average price of 14900 yuan/ton; The overall titanium dioxide market did not experience significant increases or decreases throughout 2023, and the market operation was relatively stable.

The first stage of upward trend: entering 2023, the market continues the downward trend at the end of 2022. Prices stopped falling and stabilized in January, and there was a steady increase in market prices from February to March; The price decline is due to the market entering the off-season and approaching the Spring Festival, and many market enterprises have stopped production and maintenance. As the inventory of manufacturers is digested, the price of titanium dioxide has continued to rise from February to March, with a cumulative increase of around 1300 yuan/ton. The supply of manufacturers is tight, and the market is rising; The increase in export orders for enterprises has led to an increase in FOB prices for titanium dioxide; Due to the rapid increase in prices, the operation of the titanium dioxide market weakened in late March, and there was resistance downstream from the high price of titanium dioxide. At the end of March, some companies made concessions;

The second stage of decline: from April to June, the price of titanium dioxide was weakly declining, the domestic demand market was sluggish, and there was great pressure on market shipments and price competition. After the price reduction of Longqi in May, market enterprises followed suit in lowering prices; The price of raw materials has fallen, and the price of titanium dioxide has weakened and declined. The price of by-product ferrous sulfate has also maintained a downward trend. The production pressure of titanium dioxide is high, and some prices have suffered losses. Since May, more than 20 companies in the market have taken measures to reduce production and maintain prices; In June, the market entered the off-season with weak terminal demand and high market price competition pressure. At the end of June, some companies lowered their prices again, with a cumulative decrease of 1200 yuan/ton in market prices. Due to different situations among different companies, the price reduction was different, and the price of titanium dioxide was also relatively chaotic.

The third stage of price increase: From July to September, the price of titanium dioxide continued to rise, with a cumulative increase of around 2000 yuan/ton. The main reasons for the market price increase are as follows: 1. In the second quarter, the titanium dioxide market started to decline, with manufacturers consuming more inventory and some models having tight supply; 2. In the early stage, the price of titanium dioxide was low, and some traders and downstream believed that they had bottomed out and had stocked up. Enterprises had reduced their inventory, and some models were somewhat tight; 3. The rising prices of raw materials such as titanium ore and sulfuric ACID have led to an increase in the cost of titanium dioxide powder; 4. The export market for titanium dioxide is booming, and the international titanium dioxide market supply is shrinking; On July 27th, international titanium dioxide company Komo announced its financial performance for the second quarter of 2023 and announced the closure of its Guanyin titanium dioxide production plant in Taiwan, which was beneficial for domestic titanium dioxide exports and led to a significant increase in export orders; In the third quarter, the market saw 60 titanium dioxide companies send letters to adjust prices under the promotion of Longqi. This year's market peak season has advanced twice in a row, and the Jinjiu market has also exceeded expectations.

The fourth stage of decline: from October to December, the price of titanium dioxide weakened and declined. With the end of the peak market season, the pressure on titanium dioxide companies to ship increased in late October, and some companies adjusted their prices. Starting from November, prices dropped rapidly, raw material prices fell, and titanium dioxide prices weakened and declined. In addition, the inventory of manufacturers increased, and the release of new production capacity in the market led to an imbalance between supply and demand in the titanium dioxide market. At the end of November, the new unit price of Longbai Group was reduced by 1000 yuan/ton, The price of CNNC has followed a narrow downward trend, while other companies have adjusted their prices in the early stages, with a cumulative price reduction of around 1200 yuan/ton; On December 6th, Longbai Group sent a letter raising foreign trade prices by $100 per ton, resulting in a significant increase in export orders for titanium dioxide enterprises. The increase in foreign trade demand has driven domestic trade demand, causing manufacturers to reduce inventory. In late December, some enterprises experienced a hidden price increase, and titanium dioxide prices stopped falling and stabilized.

In 2023, the overall trend of China's titanium dioxide market is still upward. Due to the steady increase in export share, the new production capacity of titanium dioxide has been consumed. In 2024, the new production capacity in the titanium dioxide market will be released, and the shortage of raw materials will continue. The titanium dioxide market will still face significant pressure in 2024.

Market price of titanium dioxide dioxide

2.1 Analysis of titanium dioxide price index

According to data monitoring, the overall trend of China's titanium dioxide price index in 2023 is upward, and the market is divided into two periods of ups and downs throughout the year. The highest point of the year was in October, with a price index of 17122.55; The lowest point of the year was in January, with a price index of 14353.01; This year, the production capacity of the titanium dioxide market has been continuously increasing, but the export market has remained good. The price of titanium dioxide has still risen compared to the beginning of the year, and after experiencing a sharp rise and fall in titanium dioxide prices in 2021 and 2022, prices have gradually returned to stability in 2023. It is expected that the trend of titanium dioxide in 2024 will still be in a volatile state.

Production capacity and output of titanium dioxide powder

3.1 Global titanium dioxide production capacity

According to statistics, the global titanium dioxide production capacity in 2023 was 9.674 million tons, with the main increase in production capacity being the increase in China's titanium dioxide production capacity. Currently, China's production capacity accounts for 55% of the global production capacity; Affected by international market demand and the operation of the titanium dioxide industry this year, some of Kemu and Fannengtuo's production capacity has withdrawn, and China's titanium dioxide production capacity share continues to gradually expand.

3.2 Global and Chinese titanium dioxide production capacity trends from 2017 to 2023

In 2023, China's titanium dioxide production capacity increased by 9% compared to last year. This year, Fannengtuo went bankrupt and restructured its factories in Italy and Germany in the international market, closed its Guanyin factory in Taiwan, and some international companies withdrew their production capacity. China's titanium dioxide production capacity is expected to grow by 10-12% in 2024.

3.3 China's titanium dioxide production capacity in 2023

The top three regions in China's titanium dioxide production capacity in 2023 are Sichuan with a production capacity of 1.04 million tons, accounting for 20%, Shandong with a production capacity of 830000 tons, accounting for 16%, and Henan with a production capacity of 650000 tons, accounting for 12%.

3.4 Analysis of titanium dioxide production in 2023

According to data statistics, the cumulative production of titanium dioxide in China from January to November 2023 was 3.821 million tons, an increase of 7.16% year-on-year, with an increase of approximately 255200 tons in production. It is expected that the annual production of titanium dioxide will be over 4.2 million tons in 2023.

From January to February, titanium dioxide enterprises started production at a low level due to the sluggish market situation. Many enterprises reduced production to maintain prices, resulting in low production; Subsequently, market demand increased in March, and the production of titanium dioxide increased, resulting in an increase in output; As the market overdrafts during the peak season, production from April to June gradually decreases, and some enterprises take turns to carry out maintenance, resulting in a decrease in output; The operating rate of the titanium dioxide market continued to increase from July to October, mainly due to the increase in production capacity and output in the market; From November to December, the production of titanium dioxide decreased slightly due to weak market demand and approaching year-end maintenance by some companies. However, due to the release of new production capacity this year, the overall production still increased.

This year, the production of titanium dioxide in the region has increased significantly, with the largest increase being in Sichuan, with an increase of 64000 tons or 8.39%; Next is the Yunnan region, with an increase of 62000 tons or 41.45%; Shandong has an increase of 53000 tons, with a growth rate of 9.95%. The highest increase in production this year is from Longbai Group, with an increase of 322800 tons. New production enterprises include Longbai Group, Qianjiang Fangyuan, and Hunan Yutu. There are also individual enterprises whose production has slightly decreased due to market and other factors.

According to statistics, the production of chlorinated titanium dioxide in China from January to November 2023 was 553500 tons, an increase of 23.16 compared to the same period last year, with an increase of about 104100 tons. It is expected that the annual production of chlorinated titanium dioxide will be 600000 tons. The increase in production of titanium dioxide produced by the chloride method is mainly due to a significant increase in the second half of the year.

3.5 Proportion of titanium dioxide process industry in 2023

With the tightening of industrial and environmental policies, higher requirements are being placed on the production and energy consumption of titanium dioxide. The production process of titanium dioxide mainly includes two methods: sulfuric acid method and chloride method. Compared with traditional sulfuric acid method titanium dioxide production process, chloride method has advantages such as short process flow, large production capacity, and energy conservation and environmental protection. Under the trend of low-carbon month on month development, chlorination has become the mainstream production process for titanium dioxide. Enterprises with low-cost and mature large-scale chlorination titanium dioxide technology have a first mover advantage and welcome greater development opportunities. The market share of chlorinated titanium dioxide is gradually expanding in the industry, with the production of chlorinated titanium dioxide accounting for 15% of the total production in 2023.

3.6 Market share of the top ten titanium dioxide companies in 2023

In the market share of titanium dioxide in 2023 (divided by production), Longbai Group ranked first with a market share of 28%, while CNNC Titanium Dioxide, Pangang Group, Lubei Chemical and China National Chemical Corporation held market shares of 7%, 6%, 5%, and 4%, respectively.

3.7 Production rate of titanium dioxide market in 2023

In 2023, the operating rate of the titanium dioxide market fluctuated greatly, and the overall operating rate remained at a relatively high level. The highest operating rate within the year was in October, with a operating rate of 90%. The lowest operating rate within the year was in January, with a operating rate of 72%. The operating rate of the titanium dioxide industry for the whole year was 82%.

Import and export data of titanium dioxide

4.1 2023 Titanium Dioxide Import Data

According to customs data, from January to November 2023, China imported approximately 73300 tons of titanium dioxide, a decrease of 36.90% compared to the same period last year, and the import volume decreased by 42900 tons; It is expected that the total import volume of titanium dioxide in 2023 will be 82000 tons.

Domestic demand is weak, imported titanium dioxide prices are high, and production costs for enterprises are under pressure. In addition, the new production capacity of Chinese chlorinated titanium dioxide is constantly being released, and the amount of high-end titanium dioxide imported from abroad is gradually decreasing.

4.2 National data on titanium dioxide imports in 2023

From January to November, Taiwan, China accounted for 27%, Mexico 18% and Japan 13% of the top three regions in terms of titanium dioxide imports.

The import volume of titanium dioxide in mainstream import regions has generally decreased to varying degrees. The top ranked region will see a further decrease in import volume next year due to the closure of the Kemu Guanyin factory. Domestic titanium dioxide production capacity will steadily increase, and the dependence on titanium dioxide imports will gradually decrease.

4.3 2023 Titanium Dioxide Export Data

According to customs data, the cumulative export volume of titanium dioxide from China from January to November 2023 was about 1.4983 million tons, an increase of 17.14% compared to the same period last year, and the export volume increased by about 219200 tons; It is expected that the total export volume of titanium dioxide in 2023 will be 1.63 million tons.

This year, the export market for titanium dioxide has maintained a good performance, with exports increasing by varying degrees compared to last year. The proportion of titanium dioxide exports in domestic production continues to increase, with titanium dioxide exports accounting for 39.21% of the total production in 2023. China's titanium dioxide production continues to increase, and the international market's titanium dioxide production capacity has exited, which is beneficial for domestic titanium dioxide exports, with a steady increase in titanium dioxide exports.

4.4 2023 National Data on Titanium Dioxide Exports

From January to November 2023, the top three countries in China's titanium dioxide export volume are India accounting for 15%, Brazil accounting for 7%, and Türkiye accounting for 6%.

The export data of titanium dioxide has maintained good performance, with varying growth rates in export countries, with some countries experiencing a slight decline in export volume. India has the largest export volume, with an increase of 54600 tons or 32.47%; The demand in domestic and international markets is gradually recovering, coupled with the sustained high exchange rate prices this year and the impact of the depreciation of the RMB, which is beneficial for the titanium dioxide export market, and the proportion of titanium dioxide exports is continuously increasing.

4.5 Average import and export price of titanium dioxide in 2023

The average import price of titanium dioxide from January to November 2023 was 3476.93 US dollars per ton, a decrease of 5.13% compared to the same period last year at 3665.09 US dollars per ton; The average monthly export price of titanium dioxide from January to November was 2189.87 US dollars per ton, a decrease of 20.73% compared to the same period last year at 2762.71 US dollars per ton.

4.6 Apparent consumption of titanium dioxide in 2023

According to the data, the apparent consumption of titanium dioxide in China from January to November 2023 was 2.4021 million tons, which was basically the same as the same period last year at 2.4026 million tons; Domestic production has increased, but domestic demand is weak. Enterprises are turning to exports, and the proportion of exports is constantly expanding.

Prediction of the future market for five titanium dioxide

According to the Central Economic Work Conference, further promoting economic recovery requires overcoming some difficulties and challenges, mainly insufficient effective demand, overcapacity in some industries, weak social expectations, and still many risks and hidden dangers. There are bottlenecks in the domestic circulation, and the complexity, severity, and uncertainty of the external environment are increasing. The meeting emphasized that "next year, we must adhere to the principles of seeking progress while maintaining stability, promoting stability through progress, and starting with success before breaking through", and continue to promote the effective improvement of the economy in terms of quality and reasonable growth in terms of quantity

Looking forward to 2024, the global economic growth will slow down, and the external demand may continue to be sluggish. The "the Belt and Road" is expected to continue to play a leading role in China's exports, while the scar effect of the epidemic is still there. The probability of consumption going stronger than expected is low, and the need to stabilize investment is stronger.

1. In 2024, the new housing sales market still faces adjustment pressure. If the economy continues to recover and the willingness to purchase property improves, coupled with the timely promotion of urban village renovation, the sales scale may achieve a slight increase.

2. The new production capacity of China's titanium dioxide market continues to increase, and it is expected that the domestic titanium dioxide production capacity will reach 6 million tons by 2024, with monthly production exceeding 500000 tons;

3. The international market share is steadily increasing, with an expected export volume of 1.63 million tons of titanium dioxide in 2023 and 1.8 million tons of titanium dioxide in 2024; Improving the quality of domestic products and enhancing industry competitiveness;

4. The domestic supply of raw material titanium concentrate is still in a tight situation, with prices continuing to operate at high levels and strong cost support for titanium dioxide;

Under the high-speed increase in supply, although terminal demand may increase, the titanium dioxide market will gradually enter a stage of oversupply compared to the weak growth rate of titanium dioxide supply. In 2024, titanium dioxide enterprises will still face significant pressure.

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