DuPont, which is based in Wilmington, Delaware, has about 20 percent of global TiO2 capacity,Saudi Arabia’s Cristal has 15 percent, Huntsman and Kronos Worldwide Inc. each have 10 percent and Tronox has 9 percent, according to the bloomberg presentation.
We now know that the weakness the market industry experienced had not been, as stated, temporary, but rather it stretched into 2013 and continues. There is, as it ever was, some indication that demand will return to the market industry, however, not all producers believe.
We are aware that prices for TiO2 slipped by between 10 and 20% over 2013 because the European recession worsened and US growth stalled.
And we also understand that China’s GDP growth has become slower than expected, which manufacturing also slumped through 2013 – but both have since grabbed.
TiO2 sales at Huntsman were $1.44 billion last year and $889 million at Princeton, New Jersey-based Rockwood. A global oversupply has caused prices to fall since mid-2012, eroding profitability.
“We anticipate TiO2 demand will continue to recover in the coming quarters,” Peter Huntsman said in the statement.
We understand that feedstock producers have accepted lower average prices for material and we have also seen the divestment of TiO2 business – with Rockwood selling its TiO2 assets to Huntsman Corp. in September in 2010. Similarly, DuPont adjusted on the record stating it really is ready to sell or spin off its Performance Chemicals business as part of its transformation to a “higher growth, less cyclical company”. DuPont’s Performance Chemical products include TiO2 technologies, fluorochemicals and fluoropolymers, and sulphuric acid.
For new producers, the forex market softness is determined by where developers sit using their projects. Those with projects coming online now, for example Base Resources, that has already settled contracts with buyers, could be in a better position than others that used more aggressive tariff of production models as we all could read on the internet.
According to feedstock producers, 2014 does look a lot better than last year. Of course, it is in their interests to state that the market industry will improve; however, many have reported an increase in need for products inside the year ahead.
“Pre-conditions for any recovery in pigment, and as a consequence high grade feedstock demand, are becoming evident,” Iluka informed the market in its Q3 2013 production update, while Sierra Rutile pointed to increasing pigment plant capacity utilization rates.
This, it said, “in combination with reports of finished TiO2 pigment inventory reaching manageable levels throughout the supply chain, ensures that any surge in end-user TiO2 consumption will directly lead to feedstock demand”.
Kenmare Resources, meanwhile, told the marketplace that it had seen a marked improvement in demand inside the last weeks of September, adding “with an improving demand outlook for pigment and an anticipated gradual ramp up in pigment plant operating rates as inventories reduce, a more normal feedstock buying pattern is expected to emerge in 2014, which is expected to support stronger customer off take”.
Others also seem supportive of the recovery in markets. Jack Blumenfrucht, CEO of Fairmont International Inc. aka Emma Chemicals, said in October, that there were “signs the TiO2 market may rebound”.
Firstly, Blumenfrucht pointed on the three successive price increases which were implemented through the top TiO2 producers in 2010, which he said “have finally succeeded in stabilizing TiO2 prices”.
Also, using the US crisis temporarily resolved, China’s economy expanding again and several optimism expressed by European and Asian leaders and industrialists; “it would appear TiO2 and titanium feedstock prices are prepared to move upwards,” Blumenfruct said.
However, he adds – all of this depends for the orders for 2014, which will be placed inside next month or two.
DuPont, the world leader in TiO2, said in their Q3 2013 results which it believes that its TiO2 sales would improve in Q4 2013, adding whose expected TiO2 industry fundamentals would improve. Volumes, it said, would increase. Despite this, it is “moving which has a sense of urgency” to divest its TiO2 sector, Ellen Kullen, CEO, said.
As TITANIUMDIOXIDERUTILE.COM attended press DuPont announced that it is board of directors had authorized management to do a full separation of its Performance Chemicals segment, which includes the TiO2, chemicals and fluoro products businesses. DuPont promises to execute the separation via a tax-free spin-off to shareholders, be subject to customary closing conditions.
Upon completion of the separation within 18 months, 100% with the new public entity is going to be owned by DuPont shareholders.
Sources of information：http://www.titaniumdioxiderutile.com/kronos/tio2-titanium-dioxide-2014-forecast-and-outlook-report