Titanium dioxide (TiO2) is an important chemical inorganic pigment, with high stability, good weather resistance, good whiteness and brightness, coloring power and hiding power and other excellent properties, is the most widely used, the largest amount of white pigment, in coatings, ink, paper, plastics, chemical fiber, ceramics and other industries have been widely used.

There are two main production processes of global titanium dioxide, respectively, chlorination and sulfuric acid process, sulfuric acid process is the titanium concentrate or acid-soluble titanium slag and concentrated sulfuric acid acid acid reaction to produce titanium oxide sulfate, hydrolysis to metataric acid, and then through calcination, grinding and other processes to get anatase and rutile titanium dioxide; Chlorination process is based on artificial rutile, high titanium slag or natural rutile as raw materials, through high temperature chlorination to produce titanium tetrachloride, and then through rectification and purification, gas phase oxidation, rapid cooling, gas solid separation and other processes to obtain titanium dioxide products, can only produce rutile titanium dioxide. At present, China mainly uses sulfuric acid process. As a leading enterprise of titanium dioxide in China, Longbai Group has the ability to produce titanium dioxide by two production processes: sulfuric acid and chlorination.

The price trend may be "M" shape

Yan titanium industry analyst Yang Xun pointed out that based on the operation law of the titanium dioxide industry and domestic and foreign demand, the price trend of titanium dioxide in 2023 or an "M" type. Specifically, prices rose from January to June this year, prices fell in the off-season from July to August, prices rose again in the peak season from September to November, and prices showed a weak correction trend in December.

Yang Xun believes that this year, the titanium dioxide market will recover at a high speed with the optimization and adjustment of the domestic epidemic prevention and control policy, and will also form a strong promotion of the real estate industry.

Another factor affecting the titanium dioxide market is industry capacity. Due to the increase in the price of titanium dioxide, previously loss-making titanium dioxide producers may have the possibility of resuming work and production, and the gradual release of new capacity of titanium dioxide will ensure domestic supply. However, at the same time, the recovery of domestic demand for titanium dioxide and the expansion of foreign exports will affect the market price of titanium dioxide in China. From the current point of view, after the Spring Festival, the titanium dioxide market is more open, and the continuity of the price rise in the first quarter is better.

Qi Yu agrees. From the supply side, the release of new production capacity of titanium dioxide this year will make the supply side have a certain guarantee. From the demand side, with the adjustment and optimization of China's epidemic prevention and control policy, the demand for titanium dioxide at home and abroad will increase. At the same time, the main downstream industries of titanium dioxide are real estate and automotive industries, and from the perspective of the development prospects of these industries, the stable and good market of titanium dioxide will be a normal trend.

It is expected that China's titanium dioxide market will be in a small growth trend from 2022 to 2026, and the consumption will reach 2.92 million tons in 2026.

Raw material shortage high price

Titanium dioxide production of raw materials are mainly titanium concentrate and sulfuric acid. Among them, titanium concentrate as a resource product, the future production will be less and less, so the market supply will be in a tight situation for a long time, and the price will remain high.

Industry insiders believe that in 2023, due to the release of new titanium dioxide production capacity, titanium resources are relatively tight and other multiple impacts, titanium dioxide prices will run at a high level. The main reason for the rise in the price of titanium dioxide is that the production of the mainstream titanium ore import countries has declined sharply this year, such as Vietnam titanium ore affected by the policy, Ukraine titanium ore affected by the war, resulting in a significant reduction in titanium dioxide imports. At the same time, the new production capacity of titanium dioxide is released more, and the supply of imported titanium ore is tight. Under the influence of these two factors, the price of titanium ore this year will continue to run at a high level, thus supporting the upward price of titanium dioxide.

Both sides of supply and demand are recovering strongly

According to the statistics of the Secretariat of the Strategic Alliance for technological innovation of titanium dioxide industry and the Titanium White branch center of the National Chemical Productivity Promotion Center, 43 whole-process enterprises in China's titanium dioxide industry will produce titanium dioxide again in 2022, and the total output of the whole industry will be 3.914 million tons. The industry pointed out that although China's titanium dioxide industry was affected by the epidemic and the market last year, the operating rate of enterprises declined in the second half of the year, but because the new capacity of titanium dioxide was released last year, the overall production of titanium dioxide still increased.

Titanium dioxide production or continue to increase this year. According to Bi Sheng, Secretary general of the Titanium Dioxide Innovation Alliance and director of the Titanium Dioxide branch center, Yunnan, Hunan, Gansu, Guizhou, Liaoning, Hubei, Inner Mongolia and other regions will have new titanium dioxide production capacity this year, it is expected that there will be about 600,000 tons of new production capacity released throughout the year, it is expected that the overall production of titanium dioxide will grow this year.

Yang Xun said that with the strong recovery of the domestic economy in 2023, most titanium dioxide producers or increase the operating rate, while some new capacity is also gradually released, I believe that it can meet domestic and foreign demand, especially the demand of overseas markets.

From the demand side, Yang Xun said that the main downstream of titanium dioxide including coatings, plastics, ink, paper and other industries, with the optimization and adjustment of the epidemic prevention and control policy and the landing of relevant support policies, the recovery of domestic and foreign terminal demand, the coating industry will usher in a retaliatory rebound in 2023. In addition, in the fields of plastics, cosmetics, medicine, new energy, nano, the demand for titanium dioxide will also be highlighted, and consumption will also grow rapidly.

In terms of exports, Yang Xun expects that titanium dioxide exports will remain stable this year. The industry also generally believes that with the increase of China's titanium dioxide in the international market share, the export market will continue to maintain a steady upward trend in 2023.

Titanium dioxide market drivers and future opportunities.

Rising demand in downstream industries: titanium dioxide application scenarios, with the development of the global economy, the improvement of people's living standards, especially the development of industrialization and urbanization in populous developing countries, stimulate the demand for titanium dioxide products continues to grow.

Progress of production process: In recent years, China's titanium dioxide enterprises have been committed to improving the production process, especially the development of chlorination, in order to improve product quality and performance, expand the application range and meet environmental protection requirements. Therefore, the continuous progress of technology has promoted the development of the titanium dioxide market.

Policies and regulations to promote industrial upgrading: With the tightening of industrial and environmental protection policies, higher requirements are put forward for titanium dioxide production and energy consumption. The "Guidance Catalogue for Industrial Structure Adjustment (2019)" promulgated by the National Development and Reform Commission in November 2019 and implemented since January 1, 2020 restricts the construction of new sulphuric acid titanium dioxide and encourages the construction of new chloride titanium dioxide production lines with a single-line production capacity of 30,000 tons or more per year. Enterprises with low-cost and mature large-scale chloride titanium dioxide technology have first-mover advantages and usher in great development opportunities.

Increasing concentration of production capacity: With the implementation of environmental protection policies, environmental protection costs have risen, and small and medium-sized producers have been forced to shut down or limit production. At the same time, leading titanium dioxide producers with core technologies for chlorination will enjoy competitive advantages brought about by favorable policies, thereby further increasing their market share. As a result, the number of titanium dioxide producers is expected to decrease, while the capacity of a single producer may increase.

Industrial chain integration: With the continuous development of the titanium dioxide market, titanium dioxide producers (especially leading enterprises) have been committed to integrating the industrial chain, involving upstream titanium ore mining, titanium concentrate processing, high titanium slag smelting and synthetic rutile production, midstream titanium dioxide products and other by-product production and downstream product development. The integration of industrial chain is conducive to reducing production costs, expanding product mix and enriching income sources.

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Industry consensus, 2023 titanium dioxide downstream demand is expected to bottom out, what do you think?

Article source: China Chemical News, China Powder Network, Jingyan Chemical Industry