Titanium Dioxide Market Demonstrates Bearish Sentiments at the Start of 2023
- 09-Jan-2023 4:24 PM
- Journalist: Li Hua
The prices of Titanium Dioxide have been observed to be on a declining trend globally since the last quarter of 2022. High inflation and the economic slowdown have been crucial factors in the negative development of Titanium Dioxide in the regional markets. The global recession concerns amid waning economic activities in the US and China have weighed on the market outlook of certain key commodities, including Titanium Dioxide. The downstream paints and coatings companies have also faced severe margin headwinds for the last 18 months due to volatility in crude oil derivatives and Titanium Dioxide.
In Germany, severe headwinds due to a sharp rise in input prices over the past few quarters have directly impacted the benchmark prices of Titanium Dioxide in the domestic region, weakening the market growth of Titanium Dioxide. The construction industry's downturn has reduced the purchase of paints and coatings, reducing manufacturers' demand for the product. There was less willingness to stock the materials, and purchases were made on a just-in-need, on-demand basis. In addition, Purchasing Managers' Index (PMI) for the construction sector dropped to 48.8 in December from 50.4 in November 2022.
On the other hand, in China, the market transactions after the new year holidays have stabilized, and there was downward pressure on the price realizations of Titanium Dioxide from the downstream paint and coating sectors. The market participants have reported that the inventories were optimum and could meet the low demand from the end-use industries. The ChemAnalyst database has shown that the prices of Titanium Dioxide plummeted by approximately 6% on a FOB basis last month in December.
According to ChemAnalyst, the product prices might sustain a downward trajectory in the forthcoming weeks. On the demand side, the offtakes from the paint and coating sectors are still subject to improvement. However, it is uncertain that global economies might decline and see a recovery in FY2023 and strengthen the market sentiments for Titanium Dioxide in the near term.