Titanium prices fluctuate rangebound, and weak demand suppresses market sentiment [SMM Titanium Weekly Review]

This week, titanium market prices experienced narrow fluctuations, but prices of various products showed a tendency to change:

Titanium concentrate

The quotes for domestic titanium concentrate (TiO2≥46%) ranged from 1,650 to 1,700 yuan/mt, with an average price of 1,675 yuan/mt. For the specification with TiO2≥47%, the quotes ranged from 1,950 to 2,100 yuan/mt, with an average price of 2,025 yuan/mt. Prices remained stable for the time being, but market sentiment was low.

The current price pressure is mainly constrained by two factors: On the one hand, the downstream titanium dioxide industry continues to operate in the doldrums, with enterprises generally digesting inventories through production cuts or maintenance of production lines. On the other hand, the average price of imported titanium concentrate in June fell to 2,107 yuan/mt, narrowing the price spread with domestic ore, reflecting weak global market demand. Currently, the inventory of imported ore at ports continues to climb, showing an overall oversupply situation.

Titanium dioxide

The quotes for anatase titanium dioxide ranged from 11,500 to 12,000 yuan/mt, with an average price of 11,750 yuan/mt. For rutile titanium dioxide, the quotes ranged from 12,500 to 13,600 yuan/mt, with an average price of 13,050 yuan/mt. The domestic quotes for chloride-process titanium dioxide were reduced by 600 yuan to 14,500-15,900 yuan/mt.

The industry continues to adopt a strategy of production cuts to support prices. The inventories of small and medium-sized enterprises have been reduced to about half a month's worth, but the inventory pressure of top-tier enterprises remains unresolved due to their large capacity scales and shrinking export orders. Affected by price competition from international giants and the release of new domestic capacity, the export FOB quotes for chloride-process products have fallen to the range of $2,050-2,150/mt. The market generally expects that price recovery may have to wait until the traditional peak season in September.

Titanium sponge

The quotes for grade 0 titanium sponge ranged from 53,000 to 54,000 yuan/mt, with an average price of 53,500 yuan/mt. For grade 1 titanium sponge, the quotes ranged from 50,000 to 51,000 yuan/mt, with an average price of 50,500 yuan/mt. Prices remained stable.

Affected by the seasonal weakening of demand, there has been an increase in bargain down purchasing prices by downstream enterprises, and the industry's profit margins continue to narrow. To stabilize market prices, Yunnan Guotai took the lead in announcing a 30% production cut in Q3, and other major producers also have intentions to follow suit. Under the expectation of active supply-side contraction, short-term prices may remain stable.

Weekly Summary

This week, the overall titanium industry chain continued to operate weakly, with each link facing the dual challenges of insufficient demand and inventory pressure. The titanium concentrate market has been significantly impacted by imported resources, and may remain in a state of low-level fluctuations in the short term. The effect of production cuts and price support in the titanium dioxide industry has been limited, and price stabilization still depends on the recovery of end-use demand. Supported by active production cuts from producers, titanium sponge prices have shown relatively strong resilience. Looking ahead, as the traditional peak consumption season approaches at the end of Q3 and some enterprises complete their maintenance plans, the industry chain may experience a phase of restocking demand. However, the overall extent of recovery still needs to be observed in terms of the pace of macroeconomic recovery and improvements in the export market. SMM will also continue to track market conditions.