Peak season expectations have yet to be effectively realized; titanium industry chain trends diverge in a tug-of-war [SMM Titanium Weekly Review]

Titanium Concentrate

This week, domestic titanium concentrate (TiO2≥46%) was quoted at 1,200-1,250 yuan/mt, averaging 1,225 yuan/mt, while the TiO2≥47% grade was quoted at 1,300-1,350 yuan/mt, averaging 1,325 yuan/mt. Mozambique-origin TiO2≥46% titanium concentrate was quoted at 1,270-1,300 yuan/mt, averaging 1,285 yuan/mt, down 50 yuan/mt WoW; Nigeria-origin TiO2≥50% titanium concentrate was quoted at 1,430-1,500 yuan/mt, flat WoW; Australia-origin TiO2≥50% titanium concentrate was quoted at 1,500-1,550 yuan/mt, also flat WoW.

The titanium concentrate market was broadly stable this week. Panxi 46-grade ore traded near 1,200 yuan/mt, with 47-grade ore only about 100 yuan/mt higher than 46-grade. Downstream titanium dioxide plants maintained a moderate purchasing pace, with production and sales levels showing no notable change. Although imported ore arrivals declined recently, overall ore prices remained low, leaving miners with thin margins. Coupled with the continued release of new supply from Xinjiang, domestic ore still faced supply pressure. Imported ore prices kept falling, steadily narrowing the spread with domestic ore, and some imported cargoes were even cheaper. Many coastal titanium dioxide producers had already begun adapting their processes to imported ore. Downstream titanium dioxide plants made some price adjustments, but end-use demand had not recovered materially, and the current state of the titanium dioxide industry fed back upstream, weighing on titanium concentrate prices. However, the market believed ore prices were already at low levels, with limited further downside room and a possibility of modest gains ahead. Still, expectations for the September peak season were not high, and even if a rebound occurred, the upside would likely be limited.

Titanium Dioxide

This week, anatase titanium dioxide was quoted at 12,000-13,000 yuan/mt, averaging 12,500 yuan/mt; rutile titanium dioxide was quoted at 12,500-14,800 yuan/mt, averaging 13,650 yuan/mt; chloride-process titanium dioxide was quoted at 15,300-17,000 yuan/mt. Prices across all titanium dioxide grades were basically flat this week.

Titanium dioxide remained in a weak but stable stalemate this week, with upward price attempts facing significant resistance. Supply showed clear divergence: enterprises with a solid top-tier client base maintained basically balanced production and sales with relatively small inventory pressure, and some cargoes were even tight. However, many plants struggled with production-sales alignment, with inventories continuing to build. To digest inventories, they opted to sell at concessions, further widening actual transaction price spreads. Industry operating rates remained stable overall, and with new capacity gradually coming online, overall supply pressure was unlikely to ease in the short term. Chloride-process prices fluctuated relatively little due to tighter supply. On the raw material side, the expiry of agricultural phosphate fertiliser export controls brought expectations of higher sulphuric acid costs, but titanium concentrate prices remained under pressure, leaving actual raw material support weak. On the demand side, real estate and coatings remained persistently sluggish, and the traditional September-October peak season had yet to materialise. Downstream buyers mostly purchased on a just-in-time basis without concentrated restocking. Even where some producers announced price adjustments or tentatively raised offers, end-user acceptance was low and actual orders fell short. Costs provided some floor support, but high inventories and weak demand capped upside room, leaving the market stuck between upward and downward forces. Short-term consolidation and stalemate are expected to continue, with focus on the actual release of downstream orders.

Titanium Slag

This week, acid-soluble titanium slag (Sichuan) was quoted at 3,600-3,800 yuan/mt; ordinary 90-grade titanium slag was mainly quoted at 5,200-5,400 yuan/mt.

The titanium slag market showed a weak but stable trend this week. On prices, the tender price for 90-grade low-calcium-magnesium high-titanium slag settled at 5,400 yuan/mt, down 50 yuan/mt from the previous round, with downward pressure still being released. On supply, industry-wide operating rates remained low. In Liaoning, high electricity costs weighed on operations, with only a few enterprises maintaining production and running at reduced rates. Inner Mongolia had relatively larger production, but profitability remained insufficient, limiting producers' willingness to operate. On the raw material side, chlorinated titanium ore prices continued to grind lower, yet titanium slag enterprises remained loss-making, with the cost-selling price inversion unchanged. Demand showed no notable improvement, with downstream procurement mainly just-in-time and market trading sluggish. Overall, with high costs, weak demand and margin pressure compounding, the titanium slag market is expected to remain weak in the short term.

Titanium Sponge

This week, grade-0 titanium sponge was quoted at 44,000-45,000 yuan/mt, averaging 44,500 yuan/mt; grade-0 titanium sponge FOB averaged $6,800/mt; grade-1 titanium sponge was quoted at 43,000-44,000 yuan/mt, averaging 43,500 yuan/mt; grade-2 titanium sponge was quoted at 42,000-43,000 yuan/mt, averaging 42,500 yuan/mt.

The titanium sponge market remained weak but stable in August. After the collective price cuts in July, end-users maintained only just-in-time procurement. Some enterprises that had planned production cuts earlier did not deliver on those commitments, and with capacity continuing to expand this year, the industry maintained high production levels. In late August, enterprise quotations loosened again, and downstream buyers mostly negotiated prices. On exports, titanium sponge export orders were largely executed under long-term contracts, with little overall change.

Titanium Materials

This week, TA1 titanium ingot was priced at 55-57 yuan/kg, TA2 titanium ingot at 54-55 yuan/kg, and TC4 at 64-66 yuan/kg. Hot-rolled titanium plate (3-8mm) was quoted at 64-68 yuan/kg, titanium welded pipe at 105-110 yuan/kg, pure titanium bar at 105-110 yuan/kg, and pure alloy bar at 120-125 yuan/kg.

The titanium materials market currently shows pronounced structural divergence in its supply-demand pattern. On the supply side, capacity release in the civil sector was constrained, with operating rates at small and medium-sized casting ingot plants below 50%. Cold-rolling margins were squeezed to breakeven levels, weakening production willingness. Meanwhile, aerospace-grade titanium material capacity was concentrated among top-tier players, with full order books significantly extending delivery lead times and keeping supply tight. On the demand side, the civil market was affected by the off-season, with procurement in chemical storage tanks and low-end equipment shrinking. Downstream buying was mainly small-batch just-in-time restocking, with strong wait-and-see sentiment. Aerospace and military sectors remained highly robust, with forging enterprises stockpiling ahead and locking in prices, driving strong demand for large-size titanium billets and vacuum arc remelting casting ingots. Overall, the polarised pattern of oversupply in civil titanium materials and undersupply in high-end titanium materials is unlikely to change in the short term, while upstream titanium sponge near its cost line provides bottom support for the entire industry chain.

Weekly Summary

This week, China's titanium industry chain showed a pattern of weak upstream pressure, stagnant consolidation in the midstream, and structural divergence downstream. Cost transmission across the chain was poor, and peak-season expectations had yet to materialise. Upstream titanium concentrate was at low levels, imported ore declined, and new Xinjiang supply added to domestic availability, leaving miners with thin margins and limited downside room for prices. Titanium slag operating rates were low, enterprises were loss-making, and market trading was sluggish. Midstream titanium dioxide was weak but stable in a stalemate, with stable operating rates, new capacity release, divergent inventories, and some enterprises selling at concessions to destock. The expiry of phosphate fertiliser export controls brought expectations of higher sulphuric acid costs, but weaker titanium concentrate undermined raw material support. Real estate and coatings demand was sluggish, and price adjustments were mostly order-repair efforts, with actual orders falling short, leaving the market stuck between upward and downward forces. Downstream titanium sponge was pressured by high capacity, with only just-in-time transactions. Titanium materials were polarised, with weak civil demand but ample high-end orders from aerospace and military sectors. Titanium sponge costs formed a bottom support, and divergent trends across segments dominated short-term market moves.

Outlook

The titanium market is expected to consolidate in the short term. On the supply side, several titanium dioxide enterprises recently raised quotations proactively, but this round of price increases was more of a repair move after earlier low-price orders ended. Downstream acceptance of the increases was limited, and the market viewed the adjustments merely as a signal rather than evidence of a substantive improvement. On the raw material side, although there are expectations of higher sulphuric acid prices, sulphuric acid has yet to show clear signs of strengthening, and titanium concentrate remains under pressure. Raw materials are only providing floor support against declines rather than forming strong upward momentum. On demand, orders have shown marginal improvement since September, but for enterprises with previously high inventories, the modest recovery only slightly eases inventory pressure. The market still needs further release of downstream demand, coupled with the genuine materialisation of the traditional September-October peak season, before titanium dioxide has the foundation for a rebound.