03 July 2012 19:44 [Source: ICIS news]
HOUSTON (ICIS)--North American third-quarter titanium dioxide (TiO2) contract prices settled at rollovers, sources confirmed on Tuesday, dealing domestic producers their first defeat in more than three years.
Although producers gave up a total of 10 cents/lb ($220/tonne, €174/tonne) on offers totalling 30 cents/lb in the first half of the year, they took no increase on 1 July after seeking gains of 20 cents/lb, effective 1 April.
Some reduced third-quarter offers were heard from smaller producers and importers, but most buyers said those offers were not accepted pending further quality-control testing.
Domestic contract values held steady at $2.00-2.12/lb, as assessed by ICIS.
Just before the pricing run-up began in the fourth quarter of 2009, contract values were $1.09-1.19/lb. The current numbers equal an increase of about 90% from three years ago.
At that time, there were some indications that recessionary pressure might be easing after holding down demand and prolonging oversupply conditions.
Buyers said the third-quarter effort was defeated by excessive inventories stemming from impoverished demand thus far in 2012. Most sources expected demand to remain soft for the remainder of the year.
However, some paint-makers said cooperative weather patterns have helped increase buying interest this coatings season, though only by single-digit percentages from extremely diminished levels one year ago.
“Even if the summer goes well and our business increases by 10% by the end of the year,” the paint producer said, “there is not enough volume to raise prices.”
Although a buyer from the plastics-compounding market said some producers may seek to boost prices in October, “I don’t think there’s anything out there driving an increase,” the buyer added. “Asia and Europe are pushing all of their TiO2 to ?xml:namespace>
Buyers said erosion before year’s end is justified by excessive inventory and generous supply-side margins in 2011, especially.
North American TiO2 producers include DuPont, Cristal, Kronos, Tronox and Huntsman.
($1 = €0.79)
For more on TiO2, visit the ICIS Plants & Projects database
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