Ilmenite is a kind of mineral found in rocks which have gone through the process of molten rock pours out onto the earth's surface from a volcano and when it cools, crystals of ilmenite began to form at a specific temperature. Ilmenite is of primary ore of titanium metal, which is being used in high-quality alloys. These alloys are then utilized to manufacture a wide variety high-quality parts and tools. For example, aircraft parts sporting equipment such as bicycle frames and artificial joints for humans can be built from this material.
A lot of ilmenite reserves exists in Western Australia, Canada, China, India, Mozambique, New Zealand, Norway, Ukraine and South Africa. In China, the ilmenite market is dependent on the downstream market as it needs high demand of ilmenite to keep the booming market active and in working position.
What’s more, China’s consumption of titanium ilmenite covers more than 80 percent of the total consumption. The main downstream market for ilmenite is the titanium dioxide industry. So when demand is high in this industry which supports the coating and paint industry, construction industry, as well as pharmaceutical industry, ultimately more ilmenite is needed. This causes a fluctuation the demand and supply.
Before and during February 2017, the demand of ilmenite was very low compared to the demand trend which was occurring in the last few years. After the spring season, many of the Chinese suppliers were hoping to get more demand of ilmenite and being optimistic, but their hopes did not turn out to be true as the titanium dioxide producers already had large inventories and they were not interested to buy more, so the prices were low till then.
With the arrival of July 2017, China imported 346,454 tons of ilmenite, which is an uptrend by 14.04% MoM, while the average import price increased by 0.65% MoM to USD180.45/t.
Normally, China's monthly ilmenite import volume averages 290,252 tonnes, but the import volume in July was higher. There are two possible reasons for this fluctuation. Firstly, Environmental inspection teams had conducted inspections in local regulators in Sichuan and Shandong Province, the major places for production of ilmenite. Inspection teams wanted to know the reasons behind the decrease of ilmenite supply, which had been significantly declined during late June and early Sept. Moreover, local prices of ilmenite and TiO2 are likely to increase as the traditional TiO2 peak season is about to arrive in Sept.–Oct. In order to meet the demand of local ilmenite, importers substantially increased their import volumes, waiting for impending ilmenite price to increase. At the same time, China's ilmenite imports also boosted by very low overseas quoted prices.
Australia, Mozambique and Kenya are the three top sources of ilmenite imports as per export data service. Specifically, China imported 113,758 tons of ilmenite from Australia, up by 37.64% MoM; 71,017 tons from Mozambique, up by 13.57% MoM; and 56,595 tons from Kenya, up by 173.41% MoM. The production of ilmenite in China is mainly focused on three key provinces in China, namely Shandong, Guangxi, and Yunnan. These provinces use to produce 80 percent of ilmenite demand in China. Due to inspection teams’ actions, this production decreased 80%–90% and local ilmenite manufacturers suspended production.
China is among top suppliers of ilmenite
The prices are expected to increase due to the
central environmental inspections, while at the same time, ilmenite prices in
other major production areas were also increased by lower supply in the Panxi
Area, with ilmenite prices increasing a little in Shandong Province, Chengde
City, Hebei Province and Guangxi Zhuang Autonomous Region.
The ilmenite market in China, in general, remains stable, but due to some factors, they are fluctuating right now. Domestic manufacturers are not able to increase production, even when they are getting higher demand from the downstream TiO2 market. China is on fourth when it comes to production but they have the largest industry for use of ilmenite. As a result, there is a great potential of importing ilmenite there.