In the first week of December 2024, Titanium Dioxide prices experienced a slight decline of 0.3%, primarily driven by oversupply conditions and weak demand from end-use industries. Despite the stable price of ilmenite, the raw material used in Titanium Dioxide production, it had no significant effect on pricing trends during this period. As the year-end approached, market sentiment remained cautious, reflecting broader economic conditions.

The bearish trend in Titanium Dioxide prices can be attributed to several key factors. With peak festivities over, demand from end-use industries, particularly in the paints and coatings, automotive, and construction sectors, remained sluggish. Additionally, seasonal dullness set in, further slowing demand. Manufacturers, operating under ample supply and weak market conditions, reduced their operating rates and remained in destocking mode. To clear excess inventories, they offered discounts, which resulted in the price of Titanium Dioxide 98% FOB Hamburg settling at USD 3200/MT in the week ending December 6th.

The downstream sectors for Titanium Dioxide include paints and coatings, with the automotive and construction industries being key consumers. In Europe, the paints and coatings sector has struggled with a slow recovery, experiencing a cumulative 12% volume decline since 2021. Although stabilization is underway, growth remains limited, with only a 1% recovery expected in 2025. However, the automotive coatings sector, particularly for electric vehicles, presents a growth opportunity amidst stagnation in the construction and industrial segments.

The sluggish performance of the European construction sector has significantly impacted Titanium Dioxide prices in Germany. In November 2024, the Eurozone’s economic momentum dropped to a 10-month low, signaling a contraction in both manufacturing and services. Rising inflation, combined with political instability in countries like France and Germany, weakened demand for construction materials. As Titanium Dioxide remains a key component in construction-related applications, such as coatings and paints, reduced activity in this sector has led to lower demand for raw materials.

Manufacturers, facing weak market conditions, have been in destocking mode, contributing to downward pressure on Titanium Dioxide prices. With rising borrowing costs and reduced investor confidence, the construction sector’s slow recovery will likely continue to hinder Titanium Dioxide price growth in the near term.

Looking ahead, Titanium Dioxide prices are expected to stay bearish through the end of the year, with sluggish demand from the construction sector likely to continue weigh on prices. While a potential rebound in the construction sector could lead to higher Titanium Dioxide prices, however, no significant recovery is anticipated until next year.