A Brief Analysis of the Recent Market for Sponge Titanium

A Brief Analysis of the Recent Market for Sponge Titanium

Recently, the sponge titanium market has remained stable as a whole. As of the time of publication, the quotation for the primary sponge titanium was 54000 to 55000 yuan/ton, and the mainstream transaction price was between 52000 to 53000 yuan/ton. Due to significant pressure from raw material cost prices, quotations of sponge titanium manufacturers are remain stable.

This year, the production capacity of the sponge titanium market has been steadily released, and although the demand for titanium materials has also increased, it is much lower than the growth rate of sponge titanium. The market supply and demand relationship is imbalanced, and the sponge titanium market continues to show a downward trend in 2023. In the second quarter, the price of sponge titanium fell rapidly. According to data, the price of sponge titanium continued to decline to the market low point in August at the beginning of the year, with a market decline of 33%; The market price is low, and the entire production process manufacturers are also in a loss state. As the market supply gradually decreases, the price of sponge titanium rebounded from the low point in the third quarter; Due to the excessive consumption of inventory by manufacturers, market prices have also increased. According to Tuduoduo, in September 2023, China's sponge titanium production reached 16150 tons, a year-on-year decrease of 6.38% and a month on month decrease of 5.50%; From January to September 2023, the cumulative production of sponge titanium reached 160400 tons, a year-on-year increase of 36.37%, and the production increased by approximately 42800 tons; The market's operating rate in September was 79%, a 6% decrease compared to August.

The cost pressure in the domestic terminal market is high, and it is difficult to accept the high price of imported sponge titanium. According to customs data, in September 2023, China imported 10.2 tons of sponge titanium, with Japan as the importing country, accounting for 100%; From January to September 2023, China imported approximately 133.72 tons of sponge titanium, a year-on-year decrease of 98.79%, and the import volume decreased by approximately 10913.36 tons. There is basically no imported sponge titanium this year.

In September 2023, China's sponge titanium exports reached 410.8 tons, an increase of 79.71% month on month and 288.56% year-on-year; From January to September 2023, China's cumulative export volume of sponge titanium was approximately 3516.3 tons, an increase of 162.31% compared to the same period last year, and the export volume increased by approximately 2175.81 tons. The domestic supply of sponge titanium is stable, and there is an advantage in price compared to imported sponge titanium. This year, the export data of sponge titanium remains good.

At present, the price of the  raw materials of titanium is still high, and the market price of magnesium ingots remains volatile, but the overall price is still high; In addition, as electricity prices continue to rise, semi-process enterprises are still in a state of production reduction and shutdown, and the entire process enterprises are basically maintaining a loss level. However, the upward pressure on sponge titanium prices is also significant, and the sponge titanium market will maintain a stable trend in the short term. In October, new production lines of Guoti and Pangang were put into operation in the domestic market. With the gradual release of production capacity, it is expected to reach production by the end of the year, and the market supply will also increase in the later stage. In addition, supported by cost prices and maintaining good export data of sponge titanium this year, it is expected that sponge titanium prices may maintain stable operation in the future.

With the continuous improvement of quality of life, the demand for titanium metal will also maintain a growing trend, not only in military and civilian fields, but also becoming indispensable in daily life.