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Sponge Titanium Warming Information
Jul 25, 2018

Since July 24th, the ongoing Chaoyang Jinda Titanium Industry Co., Ltd. (hereinafter referred to as the “Golden Titanium Shares”) “Grateful to You” trade fair, easy and casual, seems to have no pressure. In fact, it is not the case that nearly 100 people who participated in the fair were in the easy-to-follow cupping, and they always took the sponge titanium price as the axis. The company is interested in establishing a good relationship with customers in a relaxed and pleasant atmosphere, and dialysis of the market behavior of titanium in a loose integration. This "Grateful to You" trade fair revealed some information about the recovery of titanium sponge prices:

First, the recent recovery of titanium sponge has attracted the attention of downstream processing companies. The production of titanium sponge by Jinti is a major supplier of enterprises such as Western Superconductor. Although the company's fist products have a good reputation in the market, they believe that the "recovery" should not be excessive, otherwise it will stimulate the expansion of enterprises. Even stimulating the resumption of production by the discontinued enterprises will have an impact on the existing market order, resulting in waste of resources. If this happens, the warm-up may not last long. Judging from the situation in recent years, the second and third quarters of each year are all warm-up periods, and then they will cool down.

Second, this year's sponge titanium recovery is related to the continuous increase in environmental protection. As titanium tetrachloride is subject to environmental pressure, the difficulty in production capacity and limited production have stimulated the price of titanium sponge and the purchase of cash is quite difficult. The price of titanium tetrachloride has exceeded 6,500 yuan / ton, and market analysis believes that there is a possibility of breaking through 7,000 yuan. In fact, the price increase of titanium sponge is now the same as that of the previous two years. Therefore, the hot recovery of sponge titanium price requires a cold analysis.

Third, the price of titanium sponge has rebounded, both the small growth stimulus of market demand and the stimulation of continuous upstream and downstream inventory. It is difficult for the sponge titanium enterprise to walk between cold and hot. At the beginning of this year, the fact that a sponge titanium company stopped production probably told the market that the price was temporarily over. Because, "there is a death will have life," which is also the natural law of the market. As for the market's small growth stimulus for the sponge titanium price recovery, the downstream titanium processing enterprises' recent orders are increasing year-on-year and month-on-month. Recently, the reporter interviewed a company specializing in the production of titanium welded pipes. The company's sales revenue in 2017 was more than 20 million yuan. The sales revenue in the first half of this year is close to the full year of 2017 (this is an individual phenomenon, but it also reflects some There has been a small increase in the field). It can be seen that the small downstream growth is also one of the factors for the recovery of titanium sponge.

To sum up the factors, we can simply summarize the main reasons for the rebound of titanium sponge prices: the application field is gradually broadened, and the market has a small growth demand situation; the upstream and downstream continue to destock to achieve results, the market appears to be close to zero inventory of titanium sponge; environmental pressure is growing, Titanium tetrachloride has become a raw material bottleneck for sponge titanium enterprises.

 For this year's phenomenon of sponge titanium warming, we can maintain a cautiously optimistic situation, but we can't "be happy", otherwise it will be short-lived. According to market analysis, the price should have a certain upside potential on the basis of the existing more than 60,000, but don't expect the value to be too high, the price should not rise too much too fast, otherwise, the warming lasts for a short time. The reasons are as follows:

First, the rebound is too fast, it will stimulate the expansion of production enterprises, stimulate the pace of production resumption of production, leading to the rapid production of potential sponge titanium capacity as actual production, and the market growth does not match, causing the recovery to turn cold.

Second, the downstream titanium pipe processing enterprises have maintained a good import channel for sponge titanium. If the price of domestic sponge titanium is too high, the advantage will gradually lose, which will inevitably lead to the increase of imported sponge titanium production by downstream enterprises.

Third, the price of titanium sponge is recovering too fast, and it is profitable. The tens of tons of titanium sponge and titanium ingots in the national reserve are likely to go to market. The possibility of this analysis is very small, but it does not rule out the reserve when the price rises to a certain high level. The sponge titanium goes to the market. Because the quality of the suspended sponge titanium has a risk of degradation, the longer the reserve time, the greater the risk of degradation, and the possibility of a suitable price to go to the market).

Fourth, several sponge titanium enterprises are ready to start and improve their own titanium tetrachloride production system. Once they are able to produce themselves, the titanium chloride bottleneck problem will be solved. It is reported that the sponge titanium company that was discontinued at the beginning of the year is paying attention to the recent phenomenon of sponge titanium recovery, and the resumption of production is just around the corner. Another discontinued sponge titanium company is raising funds to prepare for launch.

Warming up, cooling down, and shuffling are still unavoidable facts of the titanium industry during the 13th Five-Year Plan period. For more than 10 years, the Chinese titanium industry has grown stronger in this spiral. The development of the titanium industry is too strong, resulting in a serious excess of titanium sponge capacity. Therefore, the sponge titanium enterprises that are among them should not regard each recovery as a straw for life, but treat each warming as a sign of "shuffle". This will change the pressure into power, and the more washable the health, so that every warming can become the dazzling light of the reserve enterprise's technology upgrade, quality upgrade and quality upgrade.