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The global titanium dioxide industry in China era has been blowing
titanium dioxide industry twenty years ago the Chinese Coatings Association, Vice General Secretary had just entered the titanium dioxide industry
Titanium dioxide industry twenty years ago the Chinese Coatings Association, Vice General Secretary had just entered the titanium dioxide industry , the majority of ordinary people hardly few people know that titanium dioxide is a kind of product, but also unknown titanium dioxide for the national economic indicators mean.
Mr. Deng Jie (hereinafter referred to as "Mr Tang"), back in the early 1990s, starting from the titanium dioxide business to enter the chemical industry, has worked at the world's second largest supplier of titanium dioxide (TIOXIDE), and the world's largest titanium dioxide supplier DuPont (Dupont), is responsible for developing and develop the China market, has more than ten years. Witnessed the vicissitudes of the titanium dioxide industry in the world, and titanium dioxide industry with the changes in turnover and downs, and get involved. Is a former inauguration of two titanium dioxide "giant" company and operator markets titanium dioxide single product for more than two decades. This unique experience in the Chinese market, fully aware of the titanium dioxide market can make a deeper interpretation of the operation of the law of the global titanium dioxide industry, trends and product features.
Titanium dioxide (TiO2), titanium dioxide, a non-toxic, opaque, the best whiteness and brightness, as is currently the world's most outstanding performance of the white pigment, accounting for 80 percent of all white pigment usage. been widely used in paints, plastics, paper, printing ink, chemical fiber, rubber, ceramics, cosmetics, food and pharmaceutical industries, is the sales value of one of the largest of the three commodities in the world of inorganic chemical products, second only to ammonia and phosphate .
Mr Tang told us that the titanium dioxide industry, in which up to 20 years, the world (except China) on a heavyweight titanium dioxide production line investment, but also be traced back to the 17/18 years ago of Huntsman. Since the financial crisis in 2008, the West has four titanium dioxide manufacturers have been permanently shut down.
The first quarter of 2009, Huntsman closed the 40 000 t / a production plant in Grimsby, United Kingdom, Cristal Company Stallingborough of 150 000 t / a plant to suspend production for two months from March 2009 onwards. According to relevant data, because of the long cycle of return on investment, profits and low number of reasons, many of the world's titanium dioxide plant was shut down in 2010, the United States closed three titanium dioxide plant in Western Europe closed the three Eastern Europe closed two . Titanium dioxide downstream demand is increasing, this way, in short supply in the market resulting in the titanium dioxide prices are rising. According to statistics, the global titanium dioxide production shut down since 2009 can be accounted for as much as 5-7% of the total.
Mr Tang said, at present, we judge the global titanium dioxide production is still below 2008 levels by as much as 5%. You can imagine, so that is a direct consequence, once the global economy started to recover, the face of demand for a revenge rebound, immediately into the position of production capacity, the market will maintain the tension between supply and demand of a very long time.
Production capacity, but there is no market demand, will talk about the potential consumer market to determine the fundamental factors of the longevity and the size of the demand for a product.
Emerging market consumption potential
According to Deng, introduced in the more developed countries of the global industrial economy, the demand for titanium dioxide is often relatively large, such as the U.S. titanium dioxide per capita consumption of 4.1kg, the Western European countries also reached about the consumption per capita 3kg standards, the numbers in many countries is not up to. In our case, a few years ago the per capita consumption of titanium dioxide only 0.95kg, only 25 percent of U.S. per capita consumption of titanium dioxide and titanium dioxide products per capita consumption standards in some countries in Western Europe 32%; even with the Asia-Pacific countries words, China's consumption level of titanium dioxide can only be considered lower-middle standard. It is worth mentioning that, if the Chinese population is 1.33 billion, annual per capita consumption of 3.6kg of titanium dioxide, China reached the world advanced level of demand will reach 5.2 million tons of titanium dioxide present, from this figures there is a gap of almost 4 million t.
He said that the amount of all titanium dioxide enterprises under the state of full negative Heda production produced titanium dioxide can not meet domestic demand for titanium dioxide after the economic recovery, and therefore, the future for a long period of time, the domestic demand for titanium dioxide there will be more substantial growth potential.
Otherwise a professional report points out that, for a population of 1.33 billion, in 2008, the consumption of titanium dioxide was 1.24 million tons, an average consumes only 0.93kg. Too small because China's per capita consumption of titanium dioxide, titanium dioxide market in China there is still a huge consumer space, in the last 20 years, China's titanium dioxide market will grow at a rapid pace. Faced with the huge Chinese market, coupled with the now titanium dioxide in the Chinese market has emerged to pick up signs of foreign titanium dioxide enterprises and the global titanium dioxide enterprises compete to fight for a big piece of cake. DuPont, Ishihara international titanium dioxide giants to the transfer of production base and sales market initiatives is strong empirical.
From a global perspective, emerging markets compared with developed countries, per capita consumption of titanium dioxide apparent there is a very large gap. We can anticipate the next emerging market demand for titanium dioxide will continue to grow.
With the recent rapid rise of titanium dioxide, its upstream titanium prices have gone up.
Titanium out of the "lost decade"
According to Mr. Deng introduced the world's titanium reserves are mainly concentrated in Australia, South Africa, Brazil, the United States, India, China, Norway, Canada and other countries. Among them, Australia is most important. Our resources and more difficult to mining of ilmenite annually import large quantities of titanium raw materials from Australia, Vietnam, India, Indonesia and other countries.
The titanium industry has experienced a "lost decade", he said, finally turned over. Titanium concentrate industry in the past the long-agreed price (the pricing of inflation-linked contracts) have been suppressed level of profits of mining enterprises, seriously dampen the enthusiasm of the miner's mining expansion. Shut down exit with a number of small mining companies unbearable, to reduce the supply of titanium concentrate, raise the degree of industry concentration of ilmenite supply and demand there is a clear gap between supply and demand, with the demand pull from the titanium dioxide enterprises, the gap a further widening trend. Deng also said that the rutile titanium dioxide is another important raw materials also have the same fate.
Obviously, there is a growing part of the supply and demand is extremely strained, and has long plagued the industry is about to bind to expire relaxed (to the end of 2012 is expected maturity of most of them) and go to better reflect the industry real supply and demand fundamentals short-term contracts, according to the forecast of the Goldman Sachs commodity team in Australia, titanium ore spot price years there will be 30% -70% gain.
As for rutile, love green card (Iluka) is expected to rutile in the second half of 2011, the weighted average price will rise by 70 to 75%, the weighted average price of the last half of the expected level of $ 770 / t.
The second half of 2011, the weighted average price of synthetic rutile prices expected to rise 70 to 75% weighted average price in the first half of the expected level of $ 640 / t.
According to Vietnam Economic Times reported on June 15, June 14, Vietnamese Deputy Prime Minister Hoang Trung Hai principle agreed to the ilmenite concentrate its exports to the end of 2011. The Chinese Ministry of Commerce Web site, said a Vietnamese imports of titanium manufacturers If this event continues to upgrade, domestic Vietnamese mineral imports will again be frustrated, especially titanium as a raw material enterprises. It is understood that, every year Vietnam exports to China nearly one million tons of ilmenite, ilmenite is a raw material of titanium dioxide, the reduction of ilmenite imports will affect the price trend of the titanium dioxide. Titanium supply gap widening another titanium dioxide prices pushing hand.
Despite the recent titanium crazy prices, but the face of the uncertain market situation, all investors are still concerns about future price movements of the titanium dioxide showed their ability to pass the cost of the industrial chain of the middle reaches of the titanium dioxide industry, whether we can survive the This inflection point of titanium worries a lot.
For these questions, Mr. Deng made this analysis. He said that the inflection point is yes, because the price of any product is wavy forward, however, the upstream businesses of titanium concentrate, if the excessive prices of raw materials that titanium dioxide corporate earnings hurt, then no expansion of power, which is obviously not the titanium concentrate enterprises are willing to see the situation, but also upstream in titanium concentrate resources only 4-5 at home the bulk of the lingering memory of their experience in industry over the past winter, know how to price discipline .
In addition, we split the cost of production of titanium dioxide enterprises can be found, the cost pressures of the titanium concentrate price increase for titanium dioxide is not, under normal circumstances, a typical titanium dioxide business to overseas, the general titanium concentrates, other major raw materials (such as sulfuric acid used in sulfuric acid), energy costs, fixed costs, respectively, accounted for 18%, 8%, 10%, 21%, gross margin was 28%, the cost of titanium concentrate even increased by 40%, for the enterprise, as long as titanium dioxide products prices by 7% (40% × 18% = 7%) will be able to fully pass on cost pressures to maintain gross profit (absolute level) unchanged (Figure, Figure 1 ).
Figure 1 cost structure of titanium dioxide
Kept prices for titanium dioxide enterprises, however, investors are also worried about the price of the industry chain downstream of the coatings industry capacity, able to digest the rapidly rising cost. For this, Mr. Deng made such an explanation, he said, First of all, we understand that the titanium dioxide is generally only 13% of the cost of paint, similar to the logic of our analysis of the middle reaches of titanium dioxide, paint companies, 20% titanium dioxide raw materials prices, need only 3% (20% × 13% = 3%) price increase for coating products, we can guarantee its gross profit (absolute level) unchanged. Moreover, the biggest cost in the paint from the supermarket Distribution costs for 30-40 dollars a barrel of paint, of which only $ 2 cost of titanium dioxide on the inside, even if doubled to four dollars, do consumers Xiangui not to buy? Obviously, the titanium dioxide and its downstream businesses have the ability to pass on the cost and enjoy the profit margin expansion, prices will be the next 5-10 years, titanium dioxide is the trend.
Mr. Deng Jie (hereinafter referred to as "Mr Tang"), back in the early 1990s, starting from the titanium dioxide business to enter the chemical industry, has worked at the world's second largest supplier of titanium dioxide (TIOXIDE), and the world's largest titanium dioxide supplier DuPont (Dupont), is responsible for developing and develop the China market, has more than ten years. Witnessed the vicissitudes of the titanium dioxide industry in the world, and titanium dioxide industry with the changes in turnover and downs, and get involved. Is a former inauguration of two titanium dioxide "giant" company and operator markets titanium dioxide single product for more than two decades. This unique experience in the Chinese market, fully aware of the titanium dioxide market can make a deeper interpretation of the operation of the law of the global titanium dioxide industry, trends and product features.
Titanium dioxide (TiO2), titanium dioxide, a non-toxic, opaque, the best whiteness and brightness, as is currently the world's most outstanding performance of the white pigment, accounting for 80 percent of all white pigment usage. been widely used in paints, plastics, paper, printing ink, chemical fiber, rubber, ceramics, cosmetics, food and pharmaceutical industries, is the sales value of one of the largest of the three commodities in the world of inorganic chemical products, second only to ammonia and phosphate .
Mr Tang told us that titanium dioxide has many uses, and the national economy is closely related to the titanium dioxide as a "people's life quality" products, its per capita consumption is a measure of a country is an important indicator of the level of economic development, is also a measure of the a strong basis for the national market potential.
In the past year, venture capital, the titanium dioxide is often compared with the fluorine chemical industry. In a way, both this year showed abnormal strong are the industry cycle went to the inflection point, 180-degree reversal of the story.
Mr Tang told us that the titanium dioxide industry, in which up to 20 years, the world (except China) on a heavyweight titanium dioxide production line investment, but also be traced back to the 17/18 years ago of Huntsman. Since the financial crisis in 2008, the West has four titanium dioxide manufacturers have been permanently shut down.
The first quarter of 2009, Huntsman closed the 40 000 t / a production plant in Grimsby, United Kingdom, Cristal Company Stallingborough of 150 000 t / a plant to suspend production for two months from March 2009 onwards. According to relevant data, because of the long cycle of return on investment, profits and low number of reasons, many of the world's titanium dioxide plant was shut down in 2010, the United States closed three titanium dioxide plant in Western Europe closed the three Eastern Europe closed two . Titanium dioxide downstream demand is increasing, this way, in short supply in the market resulting in the titanium dioxide prices are rising. According to statistics, the global titanium dioxide production shut down since 2009 can be accounted for as much as 5-7% of the total.
Mr Tang said, at present, we judge the global titanium dioxide production is still below 2008 levels by as much as 5%. You can imagine, so that is a direct consequence, once the global economy started to recover, the face of demand for a revenge rebound, immediately into the position of production capacity, the market will maintain the tension between supply and demand of a very long time.
Production capacity, but there is no market demand, will talk about the potential consumer market to determine the fundamental factors of the longevity and the size of the demand for a product.
Emerging market consumption potential
According to Deng, introduced in the more developed countries of the global industrial economy, the demand for titanium dioxide is often relatively large, such as the U.S. titanium dioxide per capita consumption of 4.1kg, the Western European countries also reached about the consumption per capita 3kg standards, the numbers in many countries is not up to. In our case, a few years ago the per capita consumption of titanium dioxide only 0.95kg, only 25 percent of U.S. per capita consumption of titanium dioxide and titanium dioxide products per capita consumption standards in some countries in Western Europe 32%; even with the Asia-Pacific countries words, China's consumption level of titanium dioxide can only be considered lower-middle standard. It is worth mentioning that, if the Chinese population is 1.33 billion, annual per capita consumption of 3.6kg of titanium dioxide, China reached the world advanced level of demand will reach 5.2 million tons of titanium dioxide present, from this figures there is a gap of almost 4 million t.
He said that the amount of all titanium dioxide enterprises under the state of full negative Heda production produced titanium dioxide can not meet domestic demand for titanium dioxide after the economic recovery, and therefore, the future for a long period of time, the domestic demand for titanium dioxide there will be more substantial growth potential.
Otherwise a professional report points out that, for a population of 1.33 billion, in 2008, the consumption of titanium dioxide was 1.24 million tons, an average consumes only 0.93kg. Too small because China's per capita consumption of titanium dioxide, titanium dioxide market in China there is still a huge consumer space, in the last 20 years, China's titanium dioxide market will grow at a rapid pace. Faced with the huge Chinese market, coupled with the now titanium dioxide in the Chinese market has emerged to pick up signs of foreign titanium dioxide enterprises and the global titanium dioxide enterprises compete to fight for a big piece of cake. DuPont, Ishihara international titanium dioxide giants to the transfer of production base and sales market initiatives is strong empirical.
From a global perspective, emerging markets compared with developed countries, per capita consumption of titanium dioxide apparent there is a very large gap. We can anticipate the next emerging market demand for titanium dioxide will continue to grow.
With the recent rapid rise of titanium dioxide, its upstream titanium prices have gone up.
Titanium out of the "lost decade"
According to Mr. Deng introduced the world's titanium reserves are mainly concentrated in Australia, South Africa, Brazil, the United States, India, China, Norway, Canada and other countries. Among them, Australia is most important. Our resources and more difficult to mining of ilmenite annually import large quantities of titanium raw materials from Australia, Vietnam, India, Indonesia and other countries.
The titanium industry has experienced a "lost decade", he said, finally turned over. Titanium concentrate industry in the past the long-agreed price (the pricing of inflation-linked contracts) have been suppressed level of profits of mining enterprises, seriously dampen the enthusiasm of the miner's mining expansion. Shut down exit with a number of small mining companies unbearable, to reduce the supply of titanium concentrate, raise the degree of industry concentration of ilmenite supply and demand there is a clear gap between supply and demand, with the demand pull from the titanium dioxide enterprises, the gap a further widening trend. Deng also said that the rutile titanium dioxide is another important raw materials also have the same fate.
Obviously, there is a growing part of the supply and demand is extremely strained, and has long plagued the industry is about to bind to expire relaxed (to the end of 2012 is expected maturity of most of them) and go to better reflect the industry real supply and demand fundamentals short-term contracts, according to the forecast of the Goldman Sachs commodity team in Australia, titanium ore spot price years there will be 30% -70% gain.
As for rutile, love green card (Iluka) is expected to rutile in the second half of 2011, the weighted average price will rise by 70 to 75%, the weighted average price of the last half of the expected level of $ 770 / t.
The second half of 2011, the weighted average price of synthetic rutile prices expected to rise 70 to 75% weighted average price in the first half of the expected level of $ 640 / t.
According to Vietnam Economic Times reported on June 15, June 14, Vietnamese Deputy Prime Minister Hoang Trung Hai principle agreed to the ilmenite concentrate its exports to the end of 2011. The Chinese Ministry of Commerce Web site, said a Vietnamese imports of titanium manufacturers If this event continues to upgrade, domestic Vietnamese mineral imports will again be frustrated, especially titanium as a raw material enterprises. It is understood that, every year Vietnam exports to China nearly one million tons of ilmenite, ilmenite is a raw material of titanium dioxide, the reduction of ilmenite imports will affect the price trend of the titanium dioxide. Titanium supply gap widening another titanium dioxide prices pushing hand.
Despite the recent titanium crazy prices, but the face of the uncertain market situation, all investors are still concerns about future price movements of the titanium dioxide showed their ability to pass the cost of the industrial chain of the middle reaches of the titanium dioxide industry, whether we can survive the This inflection point of titanium worries a lot.
For these questions, Mr. Deng made this analysis. He said that the inflection point is yes, because the price of any product is wavy forward, however, the upstream businesses of titanium concentrate, if the excessive prices of raw materials that titanium dioxide corporate earnings hurt, then no expansion of power, which is obviously not the titanium concentrate enterprises are willing to see the situation, but also upstream in titanium concentrate resources only 4-5 at home the bulk of the lingering memory of their experience in industry over the past winter, know how to price discipline .
In addition, we split the cost of production of titanium dioxide enterprises can be found, the cost pressures of the titanium concentrate price increase for titanium dioxide is not, under normal circumstances, a typical titanium dioxide business to overseas, the general titanium concentrates, other major raw materials (such as sulfuric acid used in sulfuric acid), energy costs, fixed costs, respectively, accounted for 18%, 8%, 10%, 21%, gross margin was 28%, the cost of titanium concentrate even increased by 40%, for the enterprise, as long as titanium dioxide products prices by 7% (40% × 18% = 7%) will be able to fully pass on cost pressures to maintain gross profit (absolute level) unchanged (Figure, Figure 1 ).
Figure 1 cost structure of titanium dioxide
Kept prices for titanium dioxide enterprises, however, investors are also worried about the price of the industry chain downstream of the coatings industry capacity, able to digest the rapidly rising cost. For this, Mr. Deng made such an explanation, he said, First of all, we understand that the titanium dioxide is generally only 13% of the cost of paint, similar to the logic of our analysis of the middle reaches of titanium dioxide, paint companies, 20% titanium dioxide raw materials prices, need only 3% (20% × 13% = 3%) price increase for coating products, we can guarantee its gross profit (absolute level) unchanged. Moreover, the biggest cost in the paint from the supermarket Distribution costs for 30-40 dollars a barrel of paint, of which only $ 2 cost of titanium dioxide on the inside, even if doubled to four dollars, do consumers Xiangui not to buy? Obviously, the titanium dioxide and its downstream businesses have the ability to pass on the cost and enjoy the profit margin expansion, prices will be the next 5-10 years, titanium dioxide is the trend.
Experienced 20 years of silence after the storm, such as dark in 2008, after the complex in 2009, after a sparkling 2010. Titanium dioxide industry is working with China's economic rise of ground into the sky slowly rising. This is not only the rise of the titanium dioxide industry, it is stated that China and the Chinese market as a global emerging market economy is the most dazzling new star in the sky vividly, the titanium dioxide industry and China's economy will be in the global economy left an indelible mark. As the global titanium dioxide industry in China era, Deng said, "has been blowing!"
