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National Supply-side Reforms Ore Prices May Stop Rising
Jun 08, 2018

In April, small and medium-sized manufacturers received weak orders. In addition, some orders from big titanium dioxide enterprises appeared in the market. There was a panic among small and medium-sized miners. The price of small and medium-sized titanium mines in Panxi area continued to decline gradually, and the market price was 200 yuan during January. / Ton reduced in magnitude. However, Dachang has a stable customer support, the price is basically stable, and there are big factories in April, the price is raised by 30 yuan/ton from March.

The market does not buy up or buy down, downstream bearish sentiment, holding a wait-and-see attitude, and more do not place orders, affecting the entire market, the market vicious cycle, and iron ore market downturn, low start-up in the mining industry, mining prices are also supporting the fine The price of ore is difficult to reduce significantly

By the country's "supply-side" reform and strict environmental protection inspections, domestic steel production capacity has been greatly reduced, and steel prices have continued to rise. Currently, domestic steel companies are increasing the use of high-grade iron ore concentrates to increase steel output. However, due to the declining trend of the overall output, the demand for iron ore concentrate materials has been greatly reduced, and the price of iron ore concentrate has oscillated. The quality grade of Panxi Iron Concentrate is nearly 10% lower than that of high-grade iron ore abroad (Brazil's mineral grade is 65%). The low grade causes the steel mills to gradually reduce the use of Panxi Iron Mine and increase the use of high-grade ores or imported mines. And the use of scrap steel to increase the production capacity of hot metal has led to the high iron ore inventory of major mining companies in Panxi.

It is reported that at present all the major mining companies in Panxi began to overhaul or reduce production. The time for resumption of production will be determined, which will affect the significant reduction of titanium concentrate production, and is expected to decrease by about 70,000 tons/month compared with the previous period. Still in the doldrums, the lack of business start-up rates, or the formation of titanium concentrates will be insufficient.

At present, the international titanium dioxide market demand is good, the domestic titanium dioxide export volume continues to record high, the demand for imported titanium ore is good; in the first quarter of 2018, China imported about 690,000 tons of titanium ore, a year-on-year decrease of 7.11%, of which the proportion of Mozambique titanium ore 37 %, Kenya accounted for 13% of titanium ore, India accounted for 10% of titanium ore; African titanium ore accounted for more than half of the total imports, the current domestic manufacturers of sulfuric acid titanium dioxide using titanium and titanium ore need to use and domestic titanium ore; Indian titanium Mine export restricted enterprises are still not sure about the news; Vietnamese titanium mines have quotas issued, but the manufacturers offer is still high, and the overall inventory pressure of Vietnamese miners is not large; recently affected by environmental protection, limited production of titanium dioxide enterprises, but The current overall impact is not great. According to statistics from Baichuan, the output of titanium dioxide in China in the first quarter was 4.15% higher than that of the same period of last year. The new capacity will be put into operation in the second half of the year in 2018, and new capacity will be put into production later. According to the forecast of the titanium dioxide center of the National Productivity Promotion Center of the Chemical Industry The total industrial output in 2018 will reach around 3.15 million tons, which is an increase of 280,000 to 300,000 tons. The demand for titanium ore will increase steadily in 2018. With the country's supply-side reform, the demand for iron ore will decline, and the output of titanium ore will decrease. Mine prices will reverse and prices will stop rising.

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