Titanium Dioxide Industry Sees First Price Increase of the Year

Recently, the titanium dioxide market experienced the first wave of price increases this year.

On January 21, Longbai Group Co., Ltd. announced that effective January 21, 2025, the sales price of all models of titanium dioxide would be increased by RMB 300 per ton for domestic customers and USD 50 per ton for international customers.

On the same day, Guangdong Huiyun Titanium Industry Co., Ltd. also announced that from January 21, prices of all titanium dioxide models would increase by RMB 300 per ton for domestic customers and USD 50 per ton for international customers.

On January 22, CNNC Hua Yuan Titanium Dioxide Co., Ltd. and Anhui Annada Titanium Industry Co., Ltd. followed suit, raising prices by RMB 500 per ton for domestic customers and USD 100 per ton for international customers. Yibin Tianyuan Group announced an increase of RMB 300 per ton for domestically produced chloride-process titanium dioxide and USD 50 per ton for international markets. Additionally, Panzhihua Dongfang Titanium Industry Co., Ltd., Kunming Donghao Technology Development Co., Ltd., and Guangxi Jinmao Titanium Co., Ltd. also raised prices by RMB 300 per ton for domestic customers and USD 50 per ton for international customers.

As of 3 PM on January 23, at least 13 titanium dioxide manufacturers had issued price increase notices. This round of price hikes comes nearly ten months after the last domestic adjustment, marking the longest interval since the second half of 2020 and the smallest increase in scale. Despite its delay, this signals the end of falling prices in the titanium dioxide market, ushering in a rebound.

Reasons Behind the Price Increases

According to Yang Xun, an analyst in the titanium dioxide industry, several factors contributed to this wave of modest price hikes:

1. Since November 2024, production cuts and shutdowns among titanium dioxide manufacturers in southwestern and eastern China have led to lower operating rates, slower inventory growth, and reduced overall supply.
2. Distributors and downstream customers have kept low inventory levels. Ahead of the Chinese New Year, restocking and hoarding have tightened supply and increased order placement.
3. Rising raw material costs and prolonged weak pricing pressured manufacturers, creating a psychological eagerness for price increases after a prolonged downturn.
4. Some manufacturers with high pre-existing inventory levels adjusted prices to more reasonable levels after securing new orders.
5. Shortages in titanium ore supply have prompted price increases among Panzhihua-based titanium concentrate producers, with recent hikes of RMB 20-30 per ton and RMB 30-80 per ton.
6. Longbai Group's well-timed and appropriately scaled price increase provided a signal to other manufacturers, even if actual price increases are challenging to implement. This move effectively communicated the end of declining prices and prepared the market for more substantial adjustments after the holiday.

Impact on the Industry

Yang Xun noted that Longbai Group's price hike notice has influenced other manufacturers, who may follow with similar increases of around RMB 300 per ton. For users and distributors who have not yet restocked, this price adjustment has heightened expectations, increasing their purchasing intentions. Based on past trends, this price increase is expected to unfold over multiple cycles, possibly lasting for 2-3 rounds, providing a significant boost to the titanium dioxide market. It has also fostered optimism among manufacturers planning to expand production capacity in 2025.

Market Trends

According to Qi Yu, an analyst from Tudodo Industry Big Data, the titanium dioxide market began January with price reductions, followed by increases. Early in the month, some leading companies reduced prices by RMB 200 per ton. However, as distributors and traders increased restocking, inventory levels decreased, creating tighter supply. For sulfuric acid-based titanium dioxide, spot availability was limited, and some manufacturers removed earlier discounts while controlling order volumes. Raw material titanium ore prices increased in January, with sulfuric acid prices dropping slightly in some regions by around RMB 50 per ton. Despite these adjustments, production costs for titanium dioxide remain high, hovering near cost lines. As the Chinese New Year approaches, approximately 20 titanium dioxide manufacturers plan routine maintenance in January and February, with expected production declines compared to December 2024.

Currently, ex-factory prices for rutile titanium dioxide, including taxes, range between RMB 13,800 and RMB 14,800 per ton, while anatase titanium dioxide prices range between RMB 12,400 and RMB 13,200 per ton.

Qi Yu highlighted strong export performance for China's titanium dioxide, with December 2024 exports reaching 158,400 tons, a year-on-year increase of 10.53%. Annual exports for 2024 totaled 1.9017 million tons, up 15.84% from the previous year. Longbai Group's price hike of RMB 300 per ton reflects substantial cost pressures and low pre-holiday inventory levels among manufacturers. The market anticipates more manufacturers to follow suit, signaling a positive outlook for the post-holiday market, with some companies likely implementing small price increases for transactions.