In the first half of this year, China's titanium ore production and demand increased from the same period last year, and the price rose from 1350 yuan per ton at the beginning of the year to 1,900 yuan per ton.Just as the market is booming, the market situation has been falling sharply in the second half of the year, and not only production and demand have fallen back, but the price also fell back to around 1300 yuan/ton at the beginning of the year.The main reason for this is the environmental verification in the provinces of several titanium industry clusters in July and August.
Under the influence of environmental verification, many of China's titanium mining enterprises and downstream enterprises have been forced to suspend production, and the production and demand of titanium mines have both declined.The fourth round of environmental inspections in August has the most impact.The fourth round of environmental verification involves shandong, sichuan, hainan and zhejiang provinces, which are important clusters of titanium industry in China.Among them, shandong and sichuan are the big provinces in the titanium dioxide industry. Meanwhile, sichuan is the most important producer of titanium mine in China, and its titanium mine output accounts for over three-quarters of the total output of the country.As a result, the production of titanium dioxide in China decreased by more than 20% in August, and the production of titanium was down by about 30%.In early September, environmental checks were phased out across the country, but many of sichuan's small and medium-sized titanium-mining companies remain idle because they do not meet the country's environmental requirements.It is fair to say that this year's tough environmental policies have had an unprecedented impact on the titanium mine market in China, and the impact continues to grow.
From the supply side, China's large scale of titanium mining enterprises are small, with an annual output of less than 50,000 tons of small enterprises.Such small businesses have neither the incentive to improve the environmental level nor the funding for environmental protection.Most small and medium-sized enterprises will face the fate of the shutdown if the state is resolute in its commitment to environmental protection.At that time, the concentration of titanium minerals in China will be greatly improved, and the power of voice will be tilted to several large mines.
In addition, if there is a collapse of small and medium-sized mines, then there will be a gap in the supply of titanium in a period of time, which will be filled by imported titanium ore.As demand for titanium ore imports increased rapidly in the short term, could lead to another round of import titanium ore price boom, which will push up the production cost of titanium downstream enterprises in our country, the industry overall profit margins are being eroded.
From the perspective of demand, the downstream titanium dioxide industry is the largest user of titanium mine, and its demand accounts for more than 85% of China's total consumption.And there are three wastes in the titanium dioxide industry.Many of these small and medium-sized enterprises also face environmental protection levels that are substandard, unable to meet the plight of qualified emissions.If future environmental verification is normalized, these enterprises will be affected, unable to release capacity, resulting in a decline in demand for raw materials.
All in all, if the titanium mining area of sichuan province meets environmental inspection, it will lead to a shortage of ti ore.In shandong, jiangsu, henan, guangxi and other downstream demand areas meet environmental protection verification, will lead to demand decline, titanium ore demand exceeds supply.In the future, the trend of environmental protection verification will become more and more prominent in the titanium mining market.