21 February 2012 18:23 [Source: ICIS news]
HOUSTON (ICIS)--Tronox expects its titanium dioxide (TiO2) sales volumes to recover this year after a 25% decline in the 2011 fourth quarter from the third, the CEO of the US-based producer said on Tuesday.
“We do not believe that there has been any structural change in the industry […] and therefore we believe that sales volume growth will naturally recover in 2012,” Tronox CEO Tom Casey told analysts during the company's 2011 fourth-quarter results conference call.
Casey said Tronox's sales would grow modestly in the current first quarter, driven by increased volumes, as well as further price increases, compared with the 2011 fourth-quarter.
In the 2012 second quarter and the second half of the year, demand growth would then go on to increase by greater rates – “in the absence of a major economic disruption in Europe, China or elsewhere,” he said.
Casey, pointing to Tronox’s TiO2 price increases even in a weak 2011 fourth-quarter, rejected an analyst’s suggestion that TiO2 markets may currently be awash in excess supply.
“Our ability to raise our prices in the face of what was clearly an unusually soft-demand quarter illustrates not only our strength in the TiO2 market, but also the fundamental strength of the market itself,” he said.
Casey also said that TiO2 ore availability was very limited.
This in turn, should work to the advantage of Tronox, which last year agreed a deal with South African miner Exxaro to back-integrate into ore, thus ensuring its feedstock supplies even in tight ore markets.
Tronox's deal with Exxaro is expected to close in early May, Casey added.
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