Accelerated Deterioration in Downstream Demand Impedes the Global Titanium Dioxide Market Growth

The macroeconomic vulnerability in the USA and economic challenges in Europe have hampered the market growth of the construction and automotive sectors. The preventive measures taken by the US government to tackle inflation have culminated in economic downturns for various end-user industries. The soaring US dollar's exchange value has added to inflation and financial strains in the regional markets, pressuring the market outlook of Titanium dioxide among the manufacturers.

In the USA, a leading market giant, Chemours, has cut its production owing to a continued decline in Titanium Dioxide demand in the regional markets throughout the third quarter of 2022. The high utility costs and inflationary pressures have dampened the downstream consumer sentiments. The Federal Reserve announced it would raise its interest rates by another 0.75 percentage points with tight monetary policy. In addition, the downstream market players have reported large stockpiles of unsold inventory, resulting in a cheaper spot market for Titanium Dioxide in the domestic region. Furthermore, with easing supply-chain disruptions, the port congestion at the USA's leading ports, Houston, Oakland, and Savannah, has been gradually improving.

On the other hand, in India, the rupee depreciated by 39 paise to a record low of 81.18 against the US dollar on September 23, 2022, leading to high import offers for various commodities, including Titanium Dioxide. According to market sources, the declination in upstream raw material prices and fluctuating input costs have pushed the Titanium Dioxide offers to their existing values. The ChemAnalyst data shows that Titanium Dioxide prices for Rutile grades plummeted approximately by 1.8% on September 23, compared to last week's observed costs.

Furthermore, the European countries have already faced enough headwinds due to the crunch in natural gas supply. The curtailed supply of natural gas has imposed downside risks on the manufacturing capacities of the construction and automotive industries. Major European companies, including steel and chemical makers, are shifting operations to the US, citing the high operating costs in the domestic region. Moreover, the demand from the terminal sector has also weakened, leading to the average market transaction for Titanium Dioxide.

According to ChemAnalyst, the Titanium Dioxide market growth is anticipated to remain under pressure owing to growing economic concerns in Europe and the USA market. However, in India, the downstream demand from the paints and coatings sector will likely improve with the end of the monsoon season and the upcoming festive hype in the forthcoming weeks.