Heavy minerals face firm demand but shakier supply

Subject

Heavy minerals market dynamics.

Significance

Prices for titanium dioxide feedstocks, including ilmenite and rutile, have recovered since 2017. Ilmenite prices have stabilised at 150-200 dollars/tonne, while those for higher-grade products, including rutile, have risen. Inventories are being reduced; destocking by pigment producers is reducing feedstock demand. Nevertheless, environmental restrictions on pigment production and domestic gas shortages are helping to underpin prices in China. Upstream, environmental restrictions are constraining Chinese ilmenite mining.

Impacts

• There are no signals that the heavy storm season in East Africa this year caused lasting damage to the supply of heavy minerals.
• Relatively good weather in the United States augurs well for the seasonal painting season in coming months.
• Any further delay in the start-up of Indian operations in Tamil Nadu would intensify existing projections for a market deficit.
• Vietnamese export quotas appear to be exhausted, which could potentially decrease the supply of ilmenite into China.
• The US Federal Trade Commission is allowing producers Tronox and Cristal to merge, provided Cristal divests from its US operations.