01 March 1997 00:00 [Source: APC]
Demand in the Asia-Pacific region for titanium dioxide is forecast to grow at around 6%/year from 1996 to 2000, according to Donald Borst, president and ceo of the world's third-largest producer, SCM.
'At the turn of the century Asia will become the second-largest TiO2 market in the world,' said Borst. 'While the Asia-Pacific TiO2 market continues to grow at a substantial pace there is cause for concern regarding supply,' he added.
Borst estimates that there is presently about 80 000 to 100 000 tonne/year of TiO2 capacity in the region that is threatened by environmental and economic pressures, as evidenced by capacity closure in 1996.
Furthermore, recent announcements of TiO2 expansion projects have been followed by indications that those projects are being deferred. SCM, for instance, has rephased its 111 000 tonne/year expansion of its chloride-process TiO2 plant near Bunbury, Western Australia, until market conditions and trends in the region improve.
'Customers in the Asia-Pacific market continue to press for increased supplies of TiO2 products. This has allowed producers to maintain high-operating rates. With the strong demand in North America and Europe, where TiO2 prices are rising, meeting the growing demand in the Asia-Pacific region becomes a challenge, especially when three-to-five year construction schedules are considered,' said Borst.
Consequently, supply to the Asia-Pacific may be constrained as the market bids for its share of global TiO2 supply. Borst hopes market economics in the region improve sufficiently so that the increased capital investment to expand capacity in the Asia-Pacific can be justified.
Meanwhile, one of SCM's main competitors, Tioxide, has announced plans to float on the UK stock market within the next six to 18 months. It is hoped that the flotation will raise up to £700m (US$1.1bn) for its UK-based parent ICI.
ICI has also committed itself to the rapidly expanding Indian paints market by announcing the construction of a 20m litre/year factory near Chandigarh. Work on the £12m facility began in January with completion due by spring 1998. Production will be for the domestic decorative and automotive refinish markets, with exports also being considered.
The plant will expand ICI India Paints' coverage of the Indian market from its existing plants at Calcutta and Hyderabad, together with the new £7.4m, 20m litre/year facility at Thane, near Mumbai.
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