Titanium dioxide market in the second half of 2025: challenges and opportunities coexist

Coating industry

Starting from April 2025, the operating load of the domestic titanium dioxide industry has been gradually declining. By the end of last week, the industry's overall operating load had fallen below 60%. Currently, titanium dioxide prices are still on a downward trend, with downstream demand entering the off-season. The market is experiencing a weak supply and demand situation. It is expected that downstream demand will remain weak in July, making it unlikely for titanium dioxide prices to rebound. However, as cost support strengthens and production cuts are anticipated, there is a possibility that titanium dioxide prices may stabilize in July.

On the first day after the Dragon Boat Festival, the titanium dioxide market fell again

On the first working day after the Dragon Boat Festival, the domestic titanium dioxide market saw a wave of price adjustments, with many companies lowering their quotes. The main players made more significant reductions, primarily due to the high prices they had previously set, which put pressure on them to adjust. Currently, the domestic titanium dioxide market is negotiating within a price range of 13,300-14,200 yuan per ton, with mid-to-low-end products being the mainstream in market transactions. Although there are rumors of lower prices, these have not yet become widespread and remain non-mainstream. Compared to before the Dragon Boat Festival, the market price has dropped by 150 yuan per ton, or 1%, clearly indicating a downward trend in market prices. Trading volumes increased on the first and second working days after the festival. This increase was due to downstream companies maintaining a bearish outlook on the future market and experiencing persistently low terminal demand, leading to a prolonged low inventory of raw materials. When the new round of price policies was announced at the beginning of the month, downstream companies replenished their inventories to meet production needs, but this replenishment was mainly driven by immediate demands rather than large-scale stockpiling, reflecting their cautious attitude towards the market's future.

The price decline is accompanied by the load reduction, which is heavy for titanium dioxide enterprises

In the second quarter, the entire market was in a downward trend. Currently, prices have fallen below the cost line, and most companies are operating at a loss, with losses ranging from 500 to 1000 yuan per ton. Despite companies reluctantly selling at lower prices to stimulate demand and reduce inventory, the market response has been lukewarm, and inventories continue to build up. To avoid greater losses from overstocking, more companies are opting to reduce production and lighten their burden. By the end of last week, the domestic titanium dioxide production load had only reached around 65%. Given the current market conditions and corporate plans, many companies still anticipate further reductions in production. Companies are now facing a difficult dilemma: on one hand, reducing production can ease inventory pressure but increases unit costs; on the other hand, maintaining high production levels means companies will face significant sales losses in a market with low prices and weak demand.

The weak downward trend continued in June and the decline may stop in July

As we enter June, the situation for downstream orders is not optimistic, largely in line with expectations. In the coatings and plastics industries, the procurement of titanium dioxide is showing a steady decline. Although July's order procurement is still some time away, the procurement plans released by major downstream manufacturers indicate that they are also pessimistic about the terminal demand in July. Therefore, the demand side is unlikely to support the price of titanium dioxide. Currently, the trend in the price of raw material sulfuric acid is worth noting. Given the significant cost pressure on titanium dioxide, any change in raw material prices can impact the production load of titanium dioxide. June and July are traditionally the off-season for demand. Although phosphorus fertilizer exports have provided some benefits to the sulfuric acid market, domestic demand remains weak, which has a more pronounced negative impact on the sulfuric acid market. Additionally, the sulfur market, as a raw material for sulfuric acid, faces strong resistance from downstream enterprises due to high prices. With the entry into the off-season, procurement volumes have decreased, putting downward pressure on sulfur prices. However, considering that overall supply is not particularly abundant, the potential for sulfur price declines is limited, and it is likely to remain at low levels. The weak trend in raw material sulfur, combined with reduced demand, suggests that the price of sulfuric acid is likely to decline slightly in June and July. For the titanium dioxide market, although the slight decline in raw materials will put downward pressure on titanium dioxide, the production load of titanium dioxide in June and July is expected to remain at 60% or even lower, gradually providing support for titanium dioxide. It is expected that by late July, the market will gradually stabilize at low levels. Based on current expectations for chemical products, the market is expected to see a certain upward momentum in late August as downstream inventory replenishment increases. The titanium dioxide market, operating at low capacity, is also expected to gradually reach a balance in supply and demand. The market is likely to see an increase in late August, driven by the rising prices of chemical products. It is important to monitor the impact of changes in the export market.