N America Q1 TiO2 price hikes given slim to even odds of success

HOUSTON (ICIS)–North American titanium dioxide (TiO2) customers said on Tuesday that the three first-quarter price-hike initiatives that have surfaced so far have somewhere between 0 and a 50/50 chance of success.

The initiatives include the latest – a 6-cent/lb ($132/tonne, €98/tonne) effort from Huntsman – and a 5-cent/lb nomination each from DuPont and Kronos.

While one buyer in the industrial coatings sector said the initiatives were unlikely to succeed at any level because of weak latent demand this year, another customer was more optimistic.

“I think they have maybe a 50/50 chance at implementing 5 cents in January,” said a buyer in the plastics compounding segment.

Each of the initiatives has an effective date of 1 October, with the DuPont announcement excluding TiO2 products sold into paper and paperboard applications. Given typical 90-day price protection, the increases – if successful – will not be implemented for most contract customers until 1 January.

Currently, the domestic contract range is $1.55-1.70/lb, as assessed by ICIS.

Architectural coatings, the largest end-market for North American TiO2, continued relatively steady after some indications that a late-season peak may have been reached.

But demand has been softer this year, and supply has been plentiful, most buy-side sources say, making increases difficult to achieve. Some forecasts indicate improved demand in 2014, however.

In the meantime, buyers say that efforts to raise prices by 8 cents/lb during the fourth quarter will not succeed despite ongoing mixed economic indicators.

Other major US North American TiO2 producers include Tronox and Cristal.

($1 = €0.74)