In early June, the titanium dioxide market showed a trend of stability with upward movement. Following the announcement by LB Group on June 5th of a price hike of 1,000 yuan per tonne, more than ten other producers—including Annada, Haifengxin, and Guocheng—successively announced similar increases of 1,000 yuan per tonne.
Yang Xun, an industry analyst at Yantai Titanium, identifies two main reasons for these price hikes:
1. Prices for key raw materials—sulfur and sulfuric acid—in major production regions remain persistently high. The spot price of sulfur has approached 10,000 yuan per tonne, providing a cost floor for producers; consequently, some manufacturers have sought alternative supplies, such as acid derived from smelting by-products.
2. The outlook for overseas exports remains optimistic. Compared to the 3-to-6-month order lead times of major international producers, China’s titanium dioxide sector retains excess supply capacity. This has led to a significant influx of orders returning to Chinese suppliers; products made via the chloride process, in particular, hold a strong competitive advantage in replacing overseas brands.
However, there are underlying concerns regarding the domestic market. As June progresses, the titanium dioxide market is entering its traditional off-season; demand has softened, trading activity is sluggish, and the volume of new orders is lackluster. While producers in the Southwest region have significantly lowered their market quotes—causing some price instability among a minority of domestic manufacturers—the sudden wave of price-hike notifications from over a dozen producers has served as a stabilizing force. The message "Stay calm—don't panic!" has undoubtedly injected confidence into the market and signaled the direction for future pricing.
At this stage, manufacturers fall into three distinct groups:
1. Leading manufacturers, buoyed by a favorable export outlook and a solid backlog of orders—with over 60% of sales already secured—are highly confident in market pricing. Furthermore, producers relying on sulfur-based acid production face significant cost pressures and are intent on pushing through immediate price hikes.
2. Manufacturers primarily reliant on the domestic market have slightly lowered their ex-factory prices, clearly aiming to capture customers and orders by leveraging price advantages.
3. Manufacturers in the middle ground are largely opting to maintain stable prices while monitoring market conditions, remaining poised to act opportunistically and flexibly.