Titanium Dioxide Prices Continue to Increase as Supply Tightens

April 3, 2018 10:49 am Published by

In December of 2016, we wrote about the steady increase in the price of Titanium Dioxide (TiO2), concluding that given the unique properties and versatility of the product; it was no surprise we were seeing prices progressively rising. You can read this blog in full here.

Fast forward a year, supply of the compound is becoming tighter and prices are continuing to increase; with a recent forecast suggesting the global Titanium Dioxide market will reach a value of $28.5 billion by 2025.

So why are we continuing to see a rise in the prices of TiO2, and should we once again be questioning whether this versatile compound is just a commodity or is it such a special pigment that it is worthy of its rising price?

What Makes Titanium Dioxide So Sought After?

Titanium Dioxide is in demand for its versatility when used as a pigment, giving a bright white appearance to what it is applied to; so much so that paint containing TiO2 is often referred to as ‘perfect white’. TiO2 can also be used to add density and opacity to other colours.

The most common use of TiO2 is in paints, varnishes, paper and plastics; accounting for around 80% of the world’s titanium dioxide consumption. Other uses of Titanium Dioxide include:

The steadily increasingly price of TiO2 has left some manufacturers looking at the use of natural fillers and extenders to reduce costs, however, this is not always advantageous.

The use of extenders can impact quality and customers may expect a price cut when buying a TiO2 product that has been extended.

At this time, it is important that manufacturers use a supplier that is prepared for price fluctuations. At MegaChem, we are as focussed on security of supply as we were 5 years ago when the market experienced shortages.

Why Is The Price of Titanium Dioxide Continuing To Rise?

There are a number of mitigating factors that have contributed to the continuing price increase of TiO2:

Chinese Manufacturing

Being one of the biggest global producers of TiO2, production issues and increased demand in China are being felt across the globe.

In 2017, it was reported that 73 Chinese TiO2 feedstock plants were permanently closed by the government after failing to meet environmental standards requirements over a period of 12 months; these plants made up around 16% of China’s production capacity.

These closures have had a knock-on effect across the industry, with other producers struggling to fill the gaps.

Furthermore, increasing demand for industrial coatings in developing countries has seen domestic demand for Titanium Dioxide to increase drastically.

Product Enhancements

New developments of the compound have also made it even more versatile and useful, somewhat justifying an increase in price. IR reflective grades reduce heat build-up in coatings and plastic components exposed to sunlight; an ideal solution for insulation panels and automotive interiors/exteriors.

For example, Vauxhall, who use Titanium Dioxide within their paintwork to improve UV resistance, enhance reflection properties and keep paint looking better for longer.

UK Leaving the European Union

Back in 2016, Brexit led to a fall in the value of UK sterling against other currencies, this meant UK manufacturers got less product for their money when buying from overseas.

Whilst the pound is becoming stable once more, Britain’s decision to leave the European Union is still having effects within the market today.

With no clear ‘divorce deal’ agreed upon and new trade deals still to be put in place, this lack of assurance is having an impact on UK manufacturers that are reliant on TiO2.

Should The Price of Titanium Dioxide Be Rising?

In conclusion, it should come as no surprise that the price of TiO2 has continued to rise. Given the uniqueness of the product, changes in the industry and new developments of the compounds capabilities as highlighted above.

In our previous post, we questioned whether TiO2 was a pigment or a commodity; it would now appear that the answer is trending towards a pigment.

Your Complete Chemical Solutions Partner

At MegaChem UK, despite the recent rises, we continue to offer both high quality and competitively priced grades of TiO2, tailored to specific applications as required. We are able to offer both direct bulk supply from manufacturers and local stock for smaller requirements.

If TiO2 is imperative to your operation, or you’re concerned about rising prices of other products you rely on; give us a call on + 44 (0) 1291 422747 or fill out a contact form below and we’ll get back to you.

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This post was written by Jack Rowland

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