2014 goldman sachs chemical intensity days tio2: opportunity … · 2018-04-14 · comprehensive...

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20112015

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The global titanium sponge market

review

David McCoy

Oct 15 INTERNATIONAL TITANIUM ASSOCIATION: ORLANDO, USA © 2015 2

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databases of industry production, market information and best practices in the world, including supply and demand

models, technical data and operating cost data for all major producers.

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Brief history of titanium sponge


1950s were the development boom years

Magnesium - Kroll

DuPont in Newport, DE - 18 ST pa (1948) up to 3,600 ST pa (1955). Closed 1962.

Nippon Electric Metallurgy Co in Chuo-ku, Tokyo – 1,800 lb pm (1951).

Titanium Metals Corp in Henderson, NV - 3,600 ST pa (1952)

Osaka Titanium in Amagasaki, Hygo Pref - 12 tpa (1952).

Nippon Soda Co in Minato-ku, Tokyo - 3 tonnes pm (1953).

Toho Titanium in Chigasaki, Kanagawa Pref – 240 tpa (1954).

Dow in Midland, MI - 100 ST pa pilot plant (1954).

ICI at Wilton, Yorkshire - 1,700 ST pa (1955).

McKechnie Bros Ltd in UK – 110 ST pa pilot plant (1955).

Cramet in Chattanooga, TN - 6,000 ST pa (1955). Closed in 1958.

Le Titanium Francais (JV) in La Praz, France (1956).

Zaporozhye, Ukraine (1956)

Sodium - Hunter

Electro-Metallurgical (Union Carbide) 7,500 ST in 1956

Mallory-Sharon Metals Corp in Ashtabula, OH 1956

ST denotes US unit of 1 ton = 2,000lb = 903 kg


1960s saw expansion into new countries

BTMK – Russia (1959)

Zunyi Titanium – China (1965)

UKTMP – Kazakhstan (1965)

Source: UKTMP

Source: Zunyi Titanium

Source: VSMPO

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Non-Chinese sponge suppliers


Verkhnaya Salda Metallurgical Production Association

VSMPO sponge production (‘000 tonnes): 2004-2014

20

10

50

0

30

40

20112010200920082007200620052004 2012 20142013

© TZMI - NOT FOR REPRODUCTION

Source: TZMI database


Japan is a critical player

Japanese sponge production (‘000 tonnes): 2004-2014

60

50

30

10

40

20

0

2010 2011 201420132012200920082007200620052004Source: Osaka Titanium



Source: Toho Titanium


Japanese sponge exports have decreased recently

Japanese sponge exports (000s tonnes): 2004 – 2014

35

30

15

25

20

10

5

0

8

2014

16

‘000 tonnes

2004 2010

15

2009

9

2008

11

2013

19

2012

31

2011

25

2007

11

2006

13

2005

9




US output increasing – when the market allows

US sponge production (‘000 tonnes): 2004-2014

4

16

0

20

12

8

20142013201220112010200920082007200620052004



Source: TIMET

Source: ATI


US sponge imports have curtailed

US sponge imports (‘000 tonnes): 2004 – 2014


33

8

21

424

4

27

2007 2008 2009 2010 2011

7

5

20

6

13

1

13

19

10

16

6

8

8

8

0

6

9 897

912

1512

7

2012 2013 2014

25

5

161

21

2

9

2004 2005 2006

132

33

161

Japan

Kazakhstan

Others



Ust-Kamenogorsk Titan-Magnesium Kombinat

UKTMP Sponge production (‘000 tonnes): 2004-2014

30

25

20

15

10

5

0

201220112010200920082007200620052004 20142013

UKTMP unwrought exports (‘000 tonnes): 2004-2014

25

20

15

10

5

0

30

2007200620052004 2014201320122011201020092008



IngotSponge




Zaporozhye Titanium & Magnesium Combine

ZTMC Sponge production (‘000 tonnes): 2004-2014

8

10

0

6

4

2

20092007200620052004 2008 20142013201220112010Source: TZMI database



Solikamsk Magnesium Works

SMG sponge production (‘000 tonnes): 2004-2014

1.5

2.0

1.0

0.5

0.0

201420132012201120102009




Output is dominated by a select number of producers

Breakdown of titanium sponge output: 2014


Anshan Hailiang Titanium Industry

0.9%

1.8%

1.5%2.2%

Shanxi Zhuofeng Titanium Industry

7.4%

Zhongxin (CITIC) Jinzhou Ferroalloys

8.8%Tangshan Tianhe Titanium Industry

8.9%Chaoyang Baisheng Titanium Industry

11.5%

Chaoyang Jinda Titanium Co Ltd

Jinchuan GroupPanzhihua Xinyu Chemical Industry

Pangang Titanium

12.3%

BaoTi Huashen Titanium Industry

15.8%

12.5%

Luoyang Sunrui Wanji Titanium

Zunyi Titanium Industry

16.4%



Growth in capacity far exceeds demand growth

China’s sponge capacity and production: 2010 – 2014

40

120

80

160

200

0

2006

65

2004

26

142

2012

81

150

48

2007 2008 2009

58

83

2005

101

‘000 tonnes

5

69

2014

118

+30.3%

+19.4%

20132010

134

81

2011

26

41

918

45 5041

68

Capacity Production




Chinese sponge exports have fluctuated

China’s sponge exports: 2004 – 2014

2

10

0

8

6

4

12

8

2006

1

3

‘000 tonnes

4

1

2004

11

1

4

6

5

2007 2008 2009 2010 2011 2012 2013 2014

9

2005




Where are Chinese sponge exports going?

China’s sponge exports: 2014


3%

United Kingdom

3%

4%

Netherlands

South Korea

Others

28%

Spain

6%Taiwan

5%

7%

United States

36%

Belgium

4%

Germany5%

Japan



Implications of China’s 12th Five Year Plan

Industry consolidation can be expected where smaller, less efficient plants will be phased out. Total sponge capacity in China could be reduced to around 100,000 tpa.

No new sponge projects (other than expansion of existing facilities) are expected to come online in the short term, unless there is a surge in domestic demand/China is able to penetrate the overseas market. According to the Plan,

sponge exports are targeted to increase to 30% of total production.

Improved plant utilisation and cost effectiveness with the rationalisation of the sector.

Source: Xinli Titanium

What is expected in the 13th five year plan (2016-2020)


India now developing sponge technology


A new facility is under construction in Saudi Arabia


The scrap & sponge dynamic

0.0

0.2

0.4

0.6

0.8

1.0

1.2

Q3

12

Q3

10

Q1

11

Q3

11

Q1

12

Q3

09

Q1

10

Q1

09

Q3

08

Q1

08

Q1

13

Q3

13

Q1

14

Q3

14

Q1

15

Ratio

Source: USGS

US scrap to ingot ratio: 2008-2015

10

25

5

0

15

20

30

Q1

08

Q3

08

Q1

09

Q1

12

Q3

09

Q1

13

Q1

11

Q3

10

Q3

12

Q1

10

Q3

11

Q3

14

Q1

15

Q3

13

Q1

14

Scrap stock

Sponge stock

Source: USGS

US quarter ending stocks (‘000 tonnes): 2008-2015


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2014 goldman sachs chemical intensity days tio2: opportunity … · 2018-04-14 · comprehensive...

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