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September Titanium Market Review

The domestic titanium ore market was stable in September, and the market price was unchanged from the previous month. In September, the operating rate of Panzhihua titanium mine enterprises has rebounded and the supply is sufficient. Inventories  of imported titanium mines continued to be high, and competition among  traders remained fierce. The price of titanium ore used in the titanium  dioxide industry was stable, and the price of titanium ore used in other  industries declined slightly. The  demand for rutile market is picking up. The price of 95% rutile offer  is slightly higher. The price of rutile in the outer disk is still  significantly higher than the domestic price. Some domestic enterprises  need to purchase foreign products at a price higher than the selling  price.

In  September, the operating rate of domestic titanium slag industry  rebounded slightly, and the price of chlorinated slag dropped slightly  by RMB 20/ton, and the price of acid slag remained unchanged. Among  them, some of the slag-reducing enterprises that reduced production in  the previous period resumed production in September, and the downstream  demand recovery was not obvious, but the export market performed more  brilliantly; the operating rate of acid slag enterprises remained  basically stable, and the procurement of downstream customers was  stable.

In September, the price of titanium tetrachloride rose by 300 yuan to 500 yuan / ton. Due  to the release of environmentally-friendly production capacity, the  domestic titanium tetrachloride market is still in short supply, and the  price increase is also reasonable. In September, the price of titanium sponge and titanium was also affected. Among  them, the price of 0# sponge titanium rose to 66,000 ~ 67,000, and the  production enterprises are still out of stock; titanium prices rose 4  yuan ~ 10 yuan / kg.

In September, the titanium dioxide market did not change from the off-season to the peak season as it did in previous years. Downstream  markets, especially in the coatings industry, are in low demand.  Although major titanium dioxide companies are striving to keep their  prices strong, some titanium dioxide companies are still choosing to cut  prices due to increased inventory. By  the end of September, more than 10 domestic titanium dioxide  enterprises announced an increase in product quotations, and the market  ushered in a favorable atmosphere.

Sponge titanium expansion storm

This year is destined to be a year of unsettled titanium industry. At  the Sino-Russian Titanium Industry Summit held on September 17, various  news emerged, the broad prospects of new materials, the gradual  maturity of new titanium products, and the importance of well-known  brands and titanium health products. But  the most shocking news for the author is that several sponge titanium  companies announced their own start-up and production increase plans in  the forum, which opened a new round of expansion storm in the titanium  industry. After the storm, the market structure of China's sponge titanium will undergo earth-shaking changes. Among them are the advancement of new technologies and the joy of application, as well as the semi-hidden market worries.

The  keynote speeches on the forum were brilliant. Xinjiang Xiangyu New  Materials Technology Co., Ltd., Luoyang Shuangrui Wanji Titanium  Industry Co., Ltd. and Pangang Group Chengdu Titanium Co., Ltd. all  announced their future development plans. Among  them, Xinjiang Xiangyu Phase I 30,000 tons of sponge titanium  production line has been completed and is about to undergo 12,000 tons  of trial operation, is expected to reach production by the end of this  year or next year; Shuangrui Wanji Phase II 20,000 tons production line  is about to be completed and will soon Production; Pangang Sponge Titanium Plant has decided to double the existing scale and add 15,000 tons of new capacity. At  the beginning of September, the 4,000-ton sponge titanium production  line of Sichuan Shengfeng Titanium Phase I has been quietly put into  operation, and the sponge titanium industry in China has become very  lively. Behind the fire, some corporate personnel also expressed concerns about future uncertainty. When the author and his old friends are joking and joking about it, this year's days are eating and drinking. After smiling, he replied: "This year is not an order, but next year's order is still not sure."

By 2020, China's sponge titanium capacity will expand to 162,000 tons, exceeding the peak of 2012 sponge titanium capacity. This  does not include the planned potential capacity of 30,000 tons of  Qinghai and 60,000 tons of Henan. If these two potential projects are  counted, the future production capacity of sponge titanium in China will  reach an astonishing 242,000 tons. Last  year, the consumption of titanium sponge in China just exceeded 70,000  tons, and the global consumption of titanium sponge was around 180,000  tons. That  is to say, if the downstream titanium processing materials cannot  rapidly expand the application scale in the next few years, the sponge  titanium industry will once again enter the adjustment period, and new  and old enterprises will launch another round of fighting.

Different  from more than 10 years ago, in this round of expansion, the author  discovered some new features: In addition to Sichuan Shengfeng, the new  production capacity is the whole process, and the scale is large. After  the expansion, the scale of the enterprises is 30,000 tons/ More than a year. The  logic is clearer, and the whole process will ensure that enterprises  are not plagued by the supply of upstream raw materials, and the  large-scale will give enterprises the advantage brought by the scale  effect.

The  author believes that from the current market situation and policy  direction, the problem of titanium tetrachloride production being bound  by environmental protection will exist for a long time. Due  to the large scale of new construction and expansion projects, it is  inevitable that sufficient raw material supply can be obtained from the  market. Therefore, it is necessary to choose a self-built chlorination  unit. In  the case of high operating rate, the electrolyzer will also reflect its  economic benefits, effectively reduce costs, and thus win market space.  The  only worry is that the downstream market demand cannot grow  synchronously with the sponge titanium production capacity, resulting in  the unsuccessful release of production capacity. That is to say, a new  round of metabolism in the sponge titanium industry is inevitable.

In the new round of competition, who will take more advantages and win? Let's look at the strengths and weaknesses of companies of all sizes. The  advantages of the above-mentioned large-scale, full-process enterprises  are based on the high operating rate. If the high operating rate cannot  be achieved, the advantages of the magnesium electrolysis device will  not be reflected. Not  only that, because the scale of the whole process enterprise is large,  its huge depreciation cost will be put into a lot of pressure if it is  spread evenly. Therefore, large-scale full-process enterprises must seize orders to ensure that they can maintain a higher start. The  unstable supply of raw materials in semi-process enterprises will  become a factor limiting production, and its advantages are mainly  reflected in less financial, depreciation burden, and flexible  production rhythm. Unlike  full-process enterprises, semi-process enterprises have lower costs of  increasing production and reducing production, and can reduce operating  pressure by controlling production in the case of less market orders. For  example, during the market downturn three or four years ago, at that  time, the whole process enterprise could not open the electrolysis  device because of the market competition incentives and insufficient  orders. Then in the next competition, the most important thing is quality and cost. The  quality of the yield and the stability between batches constitute the  quality factor. How each company can play its own advantages, such as  electricity price, raw materials and sales ability, will determine their  final cost. The  author believes that in the foreseeable future, some enterprises with  old equipment and backward technology will be destined to be replaced by  new enterprises to complete the industry upgrade. Although  this change is more cruel, competition iteration is also one of the  driving forces of social progress. Who can be crowned in the future  competition, let us wait and see.

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