By Shan Xiaotian, JLC

Global macroeconomic downturn and terminal demand decline dragged down domestic average prices of titanium products, especially prices of titanium dioxide, in the first half of 2023 (see Table 1 for details). Titanium ore prices of middle and small-sized mines in Panzhihua and Xichang fell 6% from prices at the beginning of 2023 to RMB1 920-1 980/t at the end of June 2023, while product prices of big ones changed a little.

Prices of titanium dioxide

Domestic prices of titanium dioxide continued to decline in January 2023, mainly because of factors like off-season, Spring Festival, equipment overhaul of many enterprises, etc. In February and March, the prices rebounded due to goods supply tension. Later, many enterprises following leading firms cut down prices, given weak demand, high pressure from price competition, etc. In May, some titanium dioxide producers reduced output to stop prices from further falling, and meanwhile had to face many negative factors (e.g. off-season, weak demand, lower operating rates, etc.). Prices may gradually recover in August, and slightly rebound in high season September and October.

Import and export

In the first half of 2023, China exported 836 200 tons (up 12% YoY) of titanium dioxide, and imported 32 200 tons, according to customs data. See Figure 1 and Figure 2 for details.

Figure 1 China’s titanium dioxide export in 2022 and 2023

Figure 2 China’s titanium dioxide import in 2022 and 2023

Output and capacity

The number of domestic titanium dioxide producers with normal production conditions was 43 in 2022, with two of them employing chlorination process, three adopting both sulfuric acid and chlorination processes and 38 choosing sulfuric acid process. Domestic output of titanium dioxide grew 3.27% YoY, or 124 000 tons YoY, to 3.91 million tons in 2022, including 3.26 million tons of rutile titanium dioxide (accounting for 83.32% of the total), 486 000 tons of anatase titanium dioxide (12.42% of the total) and 167 000 tons of non-pigment grade and other types of products (4.26% of the total). In H1 2023, total output was down 3.95% YoY, or 81 300 tons, to 1.97 million tons, and annual output is forecast to reach 4 million tons.

Domestic capacity of titanium dioxide was 4.7 million t/a in 2022, and is forecast to reach 6 million t/a at least at the end of 2023. However, titanium dioxide producers will face uncertainties, as only five producers have own titanium ore raw material resources and others have to: 1) purchase titanium ore from main producing areas (i.e. Panzhihua and Xichang in Sichuan) or small mines (in Chengde, Shandong, Xinjiang, etc.) with limited potential to increase capacity; 2) or employ imported titanium ore, which fell 8.77% YoY, or 333 000 tons YoY, in 2022.