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This May, in an egregiously wet Barcelona, Spain, the Smithers Rapra Titanium Dioxide (TiO2) World Summit was held and the central message was that TiO2 pigment producers must rebuild the bridges that they burnt so badly during 2011 and 2012.
This May, in an egregiously wet Barcelona, Spain, the Smithers Rapra Titanium Dioxide (TiO 2 ) World Summit was held and the central message was that TiO 2 pigment producers must rebuild the bridges that they burnt so badly during 2011 and 2012.
With the view from Wall Street, Wells Fargo managing director and leading chemical industry analyst Frank Mitsch asked: "The pigment producers couldn't be satisfied at the lower level [of prices and profitability], they had to go to the top (...) and then what happened?"
During 2011 and the beginning of 2012, the enormous price increases in TiO 2 pigment, which is just a part of a large raw materials basket, actually began to impact overall profitability.
With these dramatic price increases, even CEOs of leading paint and coatings companies began to take note. Once a CEO takes note of something as specific as the price of a single raw material, some form of action is inevitable.
Mitsch drew particular attention to CEO Charles Bunch of PPG Industries, who pledged to remove 3-6% of TiO 2 content from a gallon of paint within 12 months. PPG actually managed the lower end of that range, Bunch revealed recently to investors, and is intending to continue this work despite falling price pressures.
But other coatings companies have not ignored this and steps are being taken by all the major paint producers to reduce their reliance on TiO 2 pigment and ensure the reliance on highly-priced TiO 2, as happened in 2011, does not happen again.
Pigment producers must rebuild the trust between themselves and end-users, delegates heard - a trust that has been badly fractured in 2011 by the enormous rises in prices. There is a legitimate concern that every effort will be made to find alternatives to TiO 2, expressed speakers at the event.
The exploration of extenders like Dow Chemical's Evoque or CMP's Snowpaque can have some effect, but there is also a threat through partial substitution of Chinese product and a raft...