The Middle East situation worsens the global sulfur resource supply dilemma: titanium dioxide prices are rising, but concept stocks are falling; the contrast behind this is that companies' actual profits have not yet significantly improved.

Ask AI · Why Did the Price Increase of Titanium Dioxide Fail to Boost the Shares of Related Companies?

Reporter from Daily Economic News: Xu Shuai Editor: Yang Jun

In March 2026, the domestic titanium dioxide market experienced a price hike trend, with industry leader Longbai Group (SZ002601, stock price 17.11 yuan, market value 40.79B yuan) raising product prices three times within the month, with several companies following suit. Meanwhile, the stock prices of Longbai Group, Tianyuan Shares (SZ002386, stock price 5.65 yuan, market value 7.35B yuan), and others did not resonate with the price increases, creating the strange phenomenon of “the higher the product price, the lower the stock price.”

On April 3, after multiple interviews, the reporter from Daily Economic News found that the core driver of this round of titanium dioxide price increases in China was upstream sulfur and sulfuric acid costs being pushed up by high prices, combined with supply contraction caused by earlier industry reduction and phased demand release, jointly boosting market prices. Industry insiders believe that titanium dioxide prices will continue to rise in April, but from May to June, there is a need to beware of significant declines caused by weak terminal demand and raw material price fluctuations.

Production costs rising sharply

Entering March, the domestic titanium dioxide market saw an unprecedented “sharp rise” trend. Leading companies announced price adjustments three times within the month, with cumulative increases approaching 2,000 yuan per ton, attracting widespread market attention. Recently, a titanium dioxide company located in Panzhihua also announced a price adjustment.

As an industry leader, Longbai Group issued three consecutive price adjustment notices on March 2, 16, and 24, with domestic market increases ranging from 500 to 1,000 yuan per ton per adjustment, and international market increases of $100 to $150 per ton.

On the afternoon of April 3, the reporter called Longbai Group’s public phone line, and the other side confirmed that product prices had indeed been raised, mainly due to rising costs.

The actions of leading companies quickly ignited market sentiment, with Jin Hai Titanium, Huiyun Titanium, Annada, and others following suit.

According to data from Zhuochuang Information, as of March 30, the mainstream prices of rutile titanium dioxide had risen significantly compared to previous levels, with the mainstream negotiation range in South China reaching 14,500 to 15,000 yuan per ton, a clear increase from the end of last month. The monthly average price of domestically produced sulfate process rutile titanium dioxide in March was 13,768 yuan per ton, up 3.52% from the previous month’s average, with the increase expanding by 2.71 percentage points compared to last month.

Several industry analysts and insiders told the reporter that the core internal driver of this round of “massive and aggressive” price hikes by titanium dioxide companies was not a significant surge in downstream demand, but rather upstream sulfur and sulfuric acid prices pushing costs upward, creating a “cost-driven” effect.

Producing titanium dioxide via the sulfuric acid process consumes sulfur. Since 2026, the Middle East situation and tensions in the Strait of Hormuz have worsened the global sulfur resource supply dilemma. High international prices directly led to wide-ranging increases in domestic sulfur and sulfuric acid prices, causing production costs for titanium dioxide companies to rise sharply.

“This is cost-push,” a person from a titanium dioxide company told the reporter. “Recently, sulfuric acid prices have been high, and costs have inverted with product prices, putting companies in losses, so raising prices was also a helpless move.” Another industry insider pointed out that, due to the industry’s long-term downturn in previous years and low operating rates, this round of price increases is more about restoring profits, and the actual profitability of companies has not improved significantly. This explains why, since March, although titanium dioxide prices have increased substantially, the stock prices of companies like Longbai Group and Tianyuan Shares have not resonated with the price hikes. Longbai Group’s stock even hit its lowest point this year.

Analysts: Short-term price upward trend is clear

Besides cost factors, proactive supply-side contraction also laid the foundation for price increases. The reporter learned that, due to previous industry losses, many titanium dioxide factories chose to reduce production or halt operations for maintenance, leading to a significant decrease in market supply.

“The main reason is that many titanium dioxide factories reduced production recently,” a senior industry insider said. “Reduced production changed the supply-demand relationship, coupled with some demand recovery. Additionally, urban housing renovation and updates also drove some titanium dioxide consumption.”

From the demand side, in early and mid-March, downstream companies actively purchased raw materials due to concerns about Middle East geopolitical risks affecting future supply, significantly increasing transaction volumes that month. However, as titanium dioxide prices continued to rise, the enthusiasm for stocking decreased after mid-month, with the market mainly fulfilling previous orders, showing a general trend of necessary replenishment.

Cost pressures are gradually passing down the industry chain to downstream sectors such as papermaking, coatings, and plastics, which are facing price increase shocks. Large enterprises still have some bargaining power due to their procurement volume, while small and medium-sized companies with weaker bargaining power are under real operational pressure.

Looking ahead, Zhuochuang Information’s titanium dioxide industry analyst Sun Shanshan told the reporter that in April, the domestic average price of titanium dioxide will continue to rise, with mainstream negotiation ranges between 14,800 and 15,800 yuan per ton. With high cost pressures, combined with companies mainly fulfilling previous orders and holding limited inventories, manufacturers will firmly implement the March price increases, and market negotiation focus will continue to shift upward.

However, the market also needs to be cautious of long-term risks. In May and June, supply and demand contradictions will still exist, with upstream raw material price increases possibly contrasting sharply with weak terminal demand. As inventory levels across the industry chain continue to accumulate, the risk of significant price declines remains. Once raw material prices enter a downward channel, the market price of titanium dioxide could fall even faster.

Overall, this round of titanium dioxide price increases results from a combination of cost-driven factors, supply contraction, and phased demand release. In the short term, the upward trend is clear, but the medium- and long-term trajectory still depends on geopolitical developments, raw material price fluctuations, and the actual absorption capacity of terminal demand.

Daily Economic News