The performance of titanium dioxide enterprises exceeded expectations and the high level of raw materials supported the price in the fourth quarter.

Since the beginning of this year, the price of titanium dioxide has been rising. Affected by this, a number of titanium dioxide enterprises reported a sharp rise in performance in the first three quarters of 2021, exceeding expectations.

People from relevant enterprises told the Financial Associated Press that at present, more orders have been accumulated in the early stage, and production capacity has gradually returned to normal. Enterprises are paying close attention to orders that were not delivered in time when production was limited before delivery. At current prices, the profits of enterprises are relatively high, and the annual performance will continue to maintain an upward trend.

Net profit rose sharply more than expected

According to the third quarterly report, the net profit of medium nuclear titanium dioxide (002145 SZ) was 1.001 billion yuan, an increase of 181.37% over the same period last year. 002136.SH 's net profit was 129 million yuan, an increase of 152.55% over the same period last year. The industry leader Longbai Group (002601.SZ) made a net profit of 3.83 billion yuan, an increase of 96.48% over the same period last year. The net profit of vanadium titanium (000629.SZ) of Panzhihua Iron and Steel Co., Ltd. is 782 million yuan, up 311.49% from the same The net profit of Huiyun Titanium Industry (300891.SZ) was 173 million yuan, an increase of 168.77% over the same period last year, while that of Jinpu Titanium Industry (000545.SZ) was 157 million yuan, an increase of 393.83% over the same period last year.

In this regard, relevant business people told the Financial Associated Press that from the three quarterly reports, Longbai Group is still the most profitable company in the industry, and even if the profit growth is the smallest, it is already close to 100%. The most important reason for this is that titanium dioxide enterprises raised product prices several times in the third quarter of this year, and the average profit of the product rose by about 5%, up to 3500 yuan per ton, which exceeded expectations.

High performance in the fourth quarter may continue

Titanium dioxide enterprises' high performance growth in the first three quarters exceeded industry expectations. Relevant business people told the Financial Associated Press that judging from the current situation, the price of titanium dioxide in the fourth quarter can still be maintained at a high level, which is also good for the annual performance of titanium dioxide-related enterprises.

From the perspective of production cost, titanium concentrate and sulfuric acid, the main raw materials of titanium dioxide, have tended to be stable.

From the point of view of demand, the export demand of titanium dioxide remains strong at present. According to the latest customs data, titanium dioxide exports totaled 930600 tons in the first nine months of this year, an increase of 5.22% over the same period last year. And export prices rose to 3050-3150 US dollars per ton in October, up 300 US dollars per ton from September.

From the point of view of the supply side, affected by the double limits of energy consumption, the supply is still on the low side. At the end of October, the operating rate of the domestic industry was 74.61%, with more improvements in East China and Southwest China, but the current load in Shandong is still low.

In this regard, a relevant business personage told the Financial Associated Press that in August, the enterprise had a large number of orders, which basically covered the production in December. In fact, the current order has already been arranged in the first quarter of next year. Therefore, the fourth-quarter performance in the case that prices and orders tend to rise, product prices can be maintained at a high level.

Relevant industry data show that in October, the domestic titanium dioxide market achieved an industry-wide output of about 295900 tons, which increased by 11.56% month-on-month, but decreased by 13.71% compared with October 2020, and the inventory of titanium dioxide enterprises is still on the low side.

At the same time, it is worth mentioning that more than 2021 titanium dioxide enterprises layout ferric sulfate capacity. In the fourth quarter of this year, Anada's production capacity of 50, 000 tons of ferric sulfate has been fully put into operation, with a monthly output of 4000 tons of ferric sulfate, which can provide at least 100 million yuan in sales revenue at the current price of 25000 yuan per ton. Longbai Group's production capacity of 200000 tons of ferric sulfate will also be tested by the end of this year, and the products are expected to be put on the market next year. Therefore, with the current situation that ferric sulfate is in short supply, these production capacity will bring growth to the performance of relevant companies in the future.