Is it the last radiance of the setting sun? LB followed the increase trend.

Background

Finally the LB group announced the price increased yesterday after the global players with domestic 1000CNY/MT increase, and foreign market 150USD/MT increase, which fllowed by tens of manufactures in China till now.

In the last month of 2021, the market of tio2 suddenly sore with a new trend of increasing after several months silence.
2021 definitely is the most vibrant year of the last decade. But there are obvious reasons for the increases before as,

• The economic recovery boost the needs.
• The pandemic reduces the outputs.
• The global power crisis.
• And the prolonged supply chain.

But this time, the new trend in this month looks unfamiliar. The needs-supply background is not changed, but why do they increase? It is hard to find out why, but after talking with few experts in our channel, we conclued something in common.

When we asked, is there any shortage of the ilmenite? power? labor? or productive elements?

• No.

Is there any policies which reduces the output? What is the quantity estimated to be influenced?

• Not yet but yes, will be. The government is expected to announce the production limits policy to grante the blue sky during winter olympics in northern China for 30-50days. The quantity is arround 100k-120k tons in total.

Will the production limits policy break the balance of the supply-needs background?

• Not likely. Even there might be 100k-120k tons outputs will be cut, but the spring is always the off-season in tio2 market. Traditionally, the manufactures were likely to spend 15-20days for maintainance during spring.

Explain

So, why do they do it?

• To follow up with global trend, the international plays such as Kronos, Tronox, Venator, Chemours, and more announced their increase will effect on in Jan 1st. 2022. After Jan 1st, 2022, there will be more users shifting to China SP grades tio2. Last several monthes, the Western CP grades in western world was in shortate meanwhile the China SP grades price is catching up with the western CP in Asia pacific, africa and many other regions. The increasing price of China SP in some degree enlarge the needs of Western CP grades. But with the official increasing of the western CP grades price, the price gap between China and Western tio2 will be again enlarged. So the Chinese manufactures do belive that there could be another chance of the increasing. But will it come out as they expected?

Forcasting

It is the last radiance of the setting sun.

• Since the mid of Oct. 2021 the market is in chill. The manufacturers did not get orders abundant enough as they did in the first half of this year. Some of them even start to reducing the price to test the market. And there are still no new booming of the orders.
• The cost is not incresing, this time the increase is not stand on a solid ground.
• All the announced increasing is effected on Jan 1st. 2022 instead of next week or immediately as they did before. So they are more likely testing the market other than determined increasing.

So we do have reasons to believe that after the Chinese New Year, without seeing orders booming, the decrease will start sliently. And trust me, more and more suppliers will start to contact you actively.
All in all, buy in needs.