Current situation and development strategy of tita

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Current situation and development strategy of titanium dioxide Market in China

current situation and development strategy of titanium dioxide Market in China

August 17, 2006

Abstract: This paper analyzes the production, consumption, import and export market situation of titanium dioxide in China, and puts forward strategic ideas for the development of titanium dioxide industry

key words: titanium dioxide; Market; Development strategy

after more than 40 years of development, China has become the most dynamic country in the world's titanium dioxide industry. Especially in recent years, China's titanium dioxide industry has developed by leaps and bounds, formed a considerable scale, has a certain foundation, and has become the world's second largest titanium dioxide production country after the United States. In the first half of 2005, China's titanium dioxide industry continued to maintain a strong momentum of development, the production scale continued to rise, the market production and sales boomed, and the quality of economic operation continued to improve. However, in the new round of development stage, some contradictions and problems have also emerged, which has attracted the attention of insiders. Only by adopting practical development strategies can the titanium dioxide industry develop healthily and stably, such as inhalation products

1 current situation of titanium dioxide Market in China

titanium dioxide, as a bulk chemical raw material, is closely related to the development of the national economy. The rapid economic development will inevitably bring broad development space to the titanium dioxide industry. In 2004, both the output and demand of titanium dioxide in China were growing at a double-digit rate, showing the typical characteristics of booming production and marketing. According to the statistical results of the titanium dioxide industry branch on 28 member enterprises, a total of 392763t titanium dioxide was produced in 2004, an increase of 22.69% over the same period last year; The sales revenue was 3.414 billion yuan, an increase of 14.92% over the same period last year; As the prices of raw and auxiliary materials such as sulfuric acid, titanium ore, coal and diesel continue to rise, the overall economic benefits of the industry have been affected. 19 comparable enterprises have achieved a total profit of 147 million yuan, a decrease of 6.44% over the same period last year. Similarly, in the first half of 2005, the production and operation of titanium dioxide industry continued to develop, and all major economic indicators increased significantly over the same period last year

1.1 supply of titanium dioxide in China

1.1.1 production scale

in recent years, due to the expansion of production of enterprises in the industry and the joining of some enterprises outside the industry in the field of titanium dioxide, the production capacity of titanium dioxide in China has expanded very rapidly (see Table 1)

Table 1 the production capacity of titanium dioxide in China in recent years

the production capacity of titanium dioxide expanded from 340000 tons in 2000 to more than 700000 tons in 2004, with an increase of 105 in four years 8 % ; The output of titanium dioxide increased from 310000 tons in 2000 to about 600000 tons in 2004, an increase of 93.55%. Some data show that the increasing rate of titanium dioxide production in China is much higher than that of the world in the same period. At present, the proportion of titanium dioxide enterprises with a production scale of more than 10000 tons in China is also increasing significantly. In 1998, there were only 6 enterprises with an output of more than 10000 tons (including 10000 tons), and in 2004, there were more than 23 enterprises. In recent years, China's titanium dioxide industry has been continuously expanding production, and the capacity of major production enterprises has changed greatly. More than 60 enterprises have a total capacity of 600000 tons in 2003, more than 700000 tons in 2004 and 950000 tons in 2005. From the perspective of technology type, except that Panzhihua Steel Jinzhou titanium industry company adopts chlorination method, other enterprises adopt sulfuric acid method. At present, the production capacity of Jiangsu Taibai Group Co., Ltd., Pangang Group Chongqing Titanium Industry Co., Ltd. (including phase II), Zhonghe Huayuan titanium dioxide Co., Ltd. (including phase II) and other enterprises has reached 36000 T/A, and the production capacity of Shandong Dongjia group has reached 45000 T/A, and began to march towards 65000 T/A. It can be seen that China's titanium dioxide industry has begun to develop in the direction of scale and intensification. At present, the average scale of chlorination process of the world's six largest titanium dioxide companies is 121300 T/A, and the largest scale is 330000 T/a (DuPont); The average scale of sulfuric acid method is 64300 T/A, and the maximum scale is 140000 T/A in Kemira, Finland; In China, there is only Jinzhou titanium industry in the chlorination process, with a scale of only 15000 T/A. the largest scale of sulfuric acid process is Dongjia group, which has reached 45000 T/A. The average production scale of titanium dioxide in China is only about 7000 T/A, which is far lower than the economic scale in both chlorination and sulfuric acid processes. The large number of enterprises and low average production capacity are prominent problems

1.1.2 variety structure

for a long time, due to the small differences in the production technology of titanium dioxide by sulfuric acid method in China, the process is similar, and the homogenization of products is relatively serious, and most of them are medium and low-grade general-purpose products. This unreasonable product structure has led to a situation of "surplus and scuffle at the low end; shortage and loss at the high end" in the titanium dioxide industry. From the situation reflected by the market, in 2004, the price of titanium dioxide in foreign countries increased several times and increased significantly, while the price of domestic rutile products fell all the way. The price was mostly (135 ~ 14000) yuan/t, and the average price per ton fell to about 14500 yuan, which was more than 6000 yuan lower than that of titanium dioxide in foreign countries. Of course, in recent years, enterprises have generally attached importance to technological progress. Through the cooperation with scientific research institutes and universities, they have adopted new technologies and new processes, which have improved the technical level of the titanium dioxide industry as a whole. Many enterprises have accelerated the pace of product structure adjustment, concentrated on the research and development of products with good market prospects and high technical content, and continuously improved the grade and added value of products. For example, s r-236 of Shandong Dongjia group, r-244 of Chongqing Titanium Industry Co., Ltd. of Panzhihua Iron and Steel Group, R-215 of Zhonghe Huayuan titanium dioxide Co., Ltd., r-818 of Jinan Yuxing Chemical Co., Ltd., cr501 of Jinzhou Titanium Industry Co., Ltd., zr-940 and zr-960 of Jiangsu Taibai Group Co., Ltd. and pta-120 of titanium industry company of Panzhihua Iron and steel group represent the new level of titanium industry products in China. It is understood that the fiber grade titanium dioxide project jointly produced by Dongjia group, Mitsui Corporation and Titanium Industry Corporation of Japan entered the implementation stage last year. This is the first time that China has introduced foreign advanced technology to realize the industrialization of fiber grade titanium dioxide, which will fill a gap in China's titanium dioxide industry; In addition, some other enterprises in the industry are also developing rutile water-based coatings titanium dioxide and plastic grade special varieties, which shows that the variety structure of China's titanium dioxide industry is developing towards diversification and high-end direction

in recent years, due to the widespread attention of enterprises in the titanium dioxide industry to the optimization and upgrading of product structure, the production capacity and output of rutile titanium dioxide in China have increased continuously. In 2004, the output of rutile titanium dioxide increased by more than 40% over the previous year. At present, there are more than 10 domestic rutile titanium dioxide manufacturers. At the same time, during this period, some enterprises increased the development of new products, so that the quality of domestic rutile products continues to improve. At present, the product quality of Chongqing Titanium Industry Co., Ltd. of Panzhihua Iron and Steel Group, Zhonghe Huayuan titanium dioxide Co., Ltd., Jinan Yuxing Chemical Co., Ltd., Jiangsu Taibai Group Co., Ltd., Jinzhou titanium industry company of Panzhihua Iron and Steel Group, Nanjing titanium dioxide Chemical Co., Ltd. and Jinhong company of Shandong Dongjia group are all at the leading level in the industry. It should be noted that due to the constraints of capital, technology, product competitiveness and other factors, the development of rutile products in China is still lagging behind (see Table 2). The output of rutile products accounts for a relatively low proportion of the total output, which is far behind the international proportion of 85% - 90%

1.2 market consumption

in the past 10 years, China's national economy has developed continuously and rapidly, and the average annual growth rate of domestic GDP has exceeded 7%, effectively driving the domestic titanium dioxide market. In 1995, the consumption of titanium dioxide in China was only 146000 tons, which rose to 378000 tons in 2000, with a five-year increase of 158.9% and an average annual growth rate of 20.96%. In 2003, the consumption of titanium dioxide continued to rise to 630000 tons, an increase of 66.67% over 2000, with an average annual growth rate of 18.56%. In 2004, the consumption exceeded 700000 tons (see Table 3). It can be seen that in recent years, although the state has taken macro-control measures to curb the overheated development momentum of some industries, the consumption basis that determines economic growth has not been shaken, and the annual economic growth rate has still reached more than 9%, especially the rapid growth of demand in downstream industries of titanium dioxide, such as coatings, plastics, papermaking, chemical fiber, etc., which constitutes a driving factor for the economic growth of titanium dioxide industry. For example, in 2004, China's architectural coatings were about 1.8 million tons, while water-based emulsion paint accounted for about 45% of the output of architectural coatings, equivalent to about 800000 tons. Based on the low level of titanium dioxide, 90000 tons of water-based titanium dioxide were required; In addition, industrial coatings, which account for about 40% of the coating output, are now gradually developing towards water-based coatings titanium dioxide. The annual output of plastic products is about 14million tons. The amount of titanium dioxide used in plastic products, calculated according to the world average low level, also requires 56000 tons of titanium dioxide/A

1.2.1 import

according to customs statistics, the import volume of titanium dioxide in China in 2004 was 250000 tons, an increase of 72.4% over the same period in 2000, the highest record over the years (see Table 4). In 2005, a total of 70512t titanium dioxide of various types were imported across the country. It can be seen from table 4 that in recent years, the absolute import of titanium dioxide in China has maintained a rapid growth, accounting for more than 36% of domestic consumption. The main import places are Australia, Japan, the United States, Germany, Britain, Saudi Arabia, France, Malaysia, Spain and other countries

the main reason for the large increase in imported titanium dioxide is that at present, it is difficult for domestic titanium dioxide to enter the domestic high-end titanium dioxide market due to quality reasons, and the high-end market is monopolized by world-class manufacturers such as DuPont, meililian, kemeiji, etc. Foreign enterprises are mainly rutile titanium dioxide with good optical performance, covering power, achromatic power and excellent weather resistance, among which rutile titanium dioxide with surface treatment is in the majority, and there are various special titanium dioxide products. In recent years, with the rapid development of domestic coating, ink, plastic, rubber and other industries, the output and proportion of rutile titanium dioxide in China in recent years in Table 2

Table 3 consumption of titanium dioxide in China

Table 4 import of titanium dioxide in China in recent years

Special anatase products and rutile products form a huge market demand, and the quality of domestic products is difficult to guarantee, so the import volume increases year by year, The degree of external dependence is increasing. Among the imported titanium dioxide, rutile products are the main ones, accounting for nearly 80%. The rest are anatase products for synthetic fiber matting and other high-end anatase products

1.2.2 export

China is a large country of titanium resources, and titanium dioxide products have always been imported and exported. However, for a long time, the absolute amount of titanium dioxide exports has been growing slowly. The main export destinations are the United States, South Korea, Spain, India, Japan, France, the Netherlands, Malaysia, Thailand, Hong Kong and other countries and regions. In 2004, the export of titanium dioxide reached 94000 tons, an increase of 70.9% over 2000; In 2005, 47754t titanium dioxide was exported nationwide. In recent years, the proportion of titanium dioxide exports to the total output has not exceeded 20%, and this proportion shows a downward trend year by year (see Table 5). Most of the export products are low-grade titanium dioxide

2 development strategy of China's titanium dioxide industry

the implementation of practical development strategy is an important measure to further improve the level of China's titanium dioxide industry and narrow the gap with the international advanced level

2.1 aggregate balance strategy - strictly control the scale and prevent serious overcapacity

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