The TiO2 industry is seeing favorable supply and demand conditions. Chinese producers, the usual industry disruptors, are facing more serious challenges than their multinational competitors.

The TiO2 industry is in a position never before experienced in its long history as it moves through the seasonally high coatings demand period in North America. Demand is returning beyond average GDP levels, particularly in China. In turn, price-sensitive customers are absorbing a huge increase in price.

The outlook is positive for most TiO2 producers for 2021. Increasing demand and the limited ability of Chinese producers to respond fairs well for global players. Multiple factors, including feedstock, Chinese chloride capabilities, and product quality all will impact the long-term future of the industry.

As the TiO2 market strengthens post-pandemic, TiO2 consumers in North America will continue to be faced with the dilemma of how best to find reductions in TiO2 costs.

TiPMC believes that the details support that the worst is over for TiO2 producers and that the industry is poised for a strong recovery.

As COVID-19 spread outside China, TiO2 sales were impacted. TiPMC provides some insight, along with a view of what signs will signal an industry recovery.

TiPMC believes this scenario sets up the TiO2 industry for a roller coaster impact throughout the next several months. The implications of a weaker Chinese economy will be involved in a balancing act with reduced Chinese production and increasing Chinese production costs.

The differentiation among TiO2 products is not only growing but impacting supply and demand. Customers and suppliers alike are recognizing inventories and pricing more as “sulfate vs. chloride”, which in reality deals more with the quality of products accepted within differential segments – and having their own supply/demand dynamics.

TiO2 demand is more closely correlated to industrial production than to GDP, and the correlation between TiO2 demand and GDP is likely to decline as service sectors grow as a share of global GDP.

Pricing is beginning to reflect destocking coming to a close. Based on recent reports and trade data, TiPMC foresees prices stabilized in all regions during the traditionally strong demand period of 2Q, with price increases gaining traction toward the end of the quarter in specific regions.