Titanium dioxide continues to increase prices in May

On May 7, Ji Lilian announced that the sales price of titanium dioxide will be raised by 300 yuan per ton on the basis of the original price. Shandong Dongjia and Panzhihua Tianlun Chemical also issued a price increase notice on the same day. The price increase ranged from 300 yuan/ton to 500 yuan/ton. The company’s Titanium Dioxide Analyst Yang Xun pointed out that in the event that demand has not fully recovered, titanium dioxide manufacturers mainly want to use price increases to reinforce the previous price adjustment results, consolidate the market bullish atmosphere, enhance market confidence, stimulate demand, and implement , while speeding up the restructuring of the industry chain and mergers and acquisitions.

The price is expected to be optimistic. The price increase in May is the second round of price increase in 2015. Sichuan Longyi Titanium Industry announced in the first week of May that all titanium dioxide products had been raised by RMB 300/ton. After the price increase, the market price of the entire series of products was close to RMB 13,000/ton. Nearly 10 manufacturers in East China, Central China, and Southwest China also adjusted their prices by 300-500 yuan per ton, and the industrial bullish atmosphere was consolidated.
Yang Xun introduced that although the leading companies raised prices to boost the trend of other peer manufacturers to reverse the upward trend, but the current market demand and take the situation, many sellers are not optimistic about the price increase. The price increase is mainly to create a bullish atmosphere, and the actual transaction is still a single proposal to look at the bill, look at the quantity, and look at the form of payment.
However, Cinda Securities believes that titanium dioxide futures prices are expected to be more optimistic. From the perspective of supply and demand fundamentals, China's demand for titanium dioxide in 2015 is still able to maintain the growth rate of about 8%, the demand growth of nearly 150,000 tons, exports continue to maintain high growth, net exports are expected to increase more than 100,000 tons. With the existing capacity utilization rate of titanium dioxide plant unchanged, the supply of new domestic capacity in 2015 is expected to be less than 190,000 tons. The price of titanium dioxide is at a historically low level. It is estimated that the price of titanium dioxide will still increase in the second quarter of 2015. In addition, the pace of mergers and reorganizations in the titanium dioxide industry in 2015 will accelerate, which will help drive up the price of titanium dioxide.
Industry integration may be phased Although the industry demand has not yet been significantly improved, the recent announcement of listed companies shows that the industry consolidation continues to deepen. On May 6th, Yanli Li announced the announcement of the suspension of major events, saying that the company's major issues involved industrial integration and the target company was Sichuan Longxi Titanium Industry Co., Ltd. Compared to previous industry integration, this integration can be said to be the integration of "Macro" and "Flagship" companies.
Yang Xun believes that if the industrial integration of Wuli Lian and Sichuan Longxi can be smoothly implemented, the capacity of the newly integrated enterprise will expand rapidly. Business statistics show that the combined production capacity of Sichuan Longxi and Lililian is up to 610,000 tons (including the Lili chlorination project), and the country’s production capacity is the first. The world’s production capacity is second only to DuPont, Huntsman, and Koster. In terms of exports, in 2014, Sichuan Longxi and Handan jointly exported more than 220,000 tons of titanium dioxide, which accounted for 39.82% of the total export volume. Their influence in the international market increased sharply, their brand effect was stronger, and their market recognition was even stronger. high.
The integration will also enable related companies to incorporate pricing power and voice rights into one. Sichuan Long Yao has always been at the leading position in China and is also an important reference and coordinate for the price of other manufacturers. In addition, Li Lilian, an important supplement to the identity of listed companies, has the right to privilege pricing and discourse in the domestic market.
It is expected that this event will also help the reorganization and integration of titanium dioxide enterprises. Under the background of excess capacity, the titanium dioxide industry has entered the finishing period for a long time. There have been more restructurings and joint operations between companies in the past two years, such as the acquisition of CNI Titanium and Gansu Dongfang and Haopu Titanium and Cristal. Jiangxi Tim light and so on. It is expected that the integration among the companies in the industry will continue to promote the development of the titanium dioxide industry in a sound and sustainable direction.

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