On January 18, the closing price of methanol in Europe and the United States fell, with methanol FOB in the Gulf of the United States 99.75-100.25 cents/gallon, and methanol FOB in Rotterdam, Europe, 274-275 euros/ton, down 3.5 euros/ton.

Foreign media reported on January 17 that Rio Tinto PLC, one of the world’s largest mining companies, released its operation report for 2018 on Thursday.

According to the company’s report, copper production in mines in 2018 was 633,500 tons, an increase of 33% over the previous year. It is estimated that the output of copper in mines will be between 550,000 and 600,000 tons in 2019, and that of refined copper will be between 220,000 and 250,000 tons in 2019.

For its Kennecott Copper Mine, the company said last year’s copper production grew by 37% year-on-year, as mining continued to be active in a high-grade open-pit copper production area and production efficiency improved.

Rio Tinto said that bauxite production in 2018 was 50.4 million tons, a slight decline of 1% from the previous year, and at the top of the guidance range. Weipa’s Gove and Andom mining areas have strong output, offsetting the other two mines’sluggish output.

The latest Amun project launched its first shipment six weeks ahead of schedule and shipped a total of nine 600,000 tons of bauxite by the end of 2018.

On January 16, FOB Rotterdam was stable with prices ranging from $626 to $631 per ton.

The Indian acetone market closed stable on January 16, with CIF prices ranging from $458.5 to $461.5 per ton.

On Wednesday, the chief executive of the Polish Copper Group (KGHM) said that the average price of copper this year is expected to range from $6,100 to $6,300 per ton.

“We are referring to the low end of analysts’estimates of copper price ranges. We think the average copper price is $6,100-6,300 per ton. I think it’s realistic. At present, copper prices are close to $6,000.

On January 11, the closing price of propylene market in Europe and America rose slightly. The closing price of FD in the United States Gulf is US$532-552 per ton, the price remains unchanged; the closing price of FD in Northwest Europe is Euro 901-910 per ton, up by Euro 1 per ton; and the closing price of CIF in Northwest Europe is Euro 901-910 per ton, up by Euro 1 per ton.

The closing price of p-xylene in the U.S. market rose by $30.5 per ton on January 14, closing at $1031-1041 per ton FOB in the U.S. Harbour.

Price Trend
According to the price monitoring of business associations, the domestic methanol market rose this week. At the beginning of the week, the average domestic methanol market price was 2,218 yuan/ton, and at the end of the week it was 2306 yuan/ton. The price rose by 3.97% in the week, falling by 14.40% compared with the same period last year.

II. Market Analysis

Products: This week, the adjustment range is relatively cautious. Among them, the overall operation of ports is weak under the influence of inventory increase and subsequent arrival concentration. Mainland markets adjust flexibly according to their own warehouse pressure, such as: Southern Shandong and Guanzhong shipments can still be lowered, maintaining an upward shift of 20-30 yuan/ton; North China and Central China are temporarily stabilizing. Based on the fact that the overall shipment of the production area is still acceptable this week, and the warehouse pressure of enterprises has eased; however, under the continuous fermentation of the tightening capacity at the end of the year, the sustained increase of freight or the reverse suppression of the increase of the production area, it is expected that the short-term stability of the Mainland will be greater, and the overall warehouse drainage of the market will still be obvious before the year.

Industry chain: formaldehyde: the weather turned cold, downstream slabs started to decline, the demand for formaldehyde was light; raw material methanol rebounded recently, cost support is still acceptable, Shandong formaldehyde finishing wait-and-see trend. Now Linyi is around 1050-1060 yuan/ton, Zibo and its surrounding areas around 1200-1300 yuan/ton. Acetic acid: The domestic glacial acetic acid market has fallen sharply. The downstream acetate, chloroacetic acid and vinyl acetate are not good, and the intention of pre-season stock is general. The local storage pressure of acetic acid enterprises is slightly obvious, and considering the Spring Festival holidays, the enterprises have a higher intention to arrange goods within a week, so the local real unit price is lower in a day. However, the recent performance of methanol raw material, acetic acid profits continue to compress, so acetic acid is expected to continue downward space is limited. Dimethyl ether: The market supply is still tight, the overall inventory of enterprises is controllable, the short-term mentality is still strong, and the short-term domestic mainstream price trend of dimethyl ether is still bullish.

3. Future Market Forecast

Business Cooperatives Viewpoint: On the positive side, the raw material side: although natural gas in the northern heating season has not been expected to be tense in recent years, the seasonal supply and demand situation from coal, natural gas and other energy sources still has some support; Freight: Freight has been rising continuously in some areas in recent years, coupled with rain and snow weather in some parts of the country, transportation constraints, transportation costs in some areas have increased; Inventory: by the holiday bureau. Due to the tight influence of shipping closure and storage capacity, the overall unloading speed is slower, the inventory of East China Port is reduced, and the arrival of ship cargo in Ningbo area is delayed due to the influence of earlier closure, and the saleable volume is greatly reduced. On the short side, the external market: the recent external market negotiations are still weak and prices remain low, especially in Europe, where prices continue to decline slightly, and the pace of delivery in Iran needs to be paid attention to; demand: the current domestic environmental protection constraints, coupled with the traditional off-season in winter, the downstream industry still shows poor start, the digestion of methanol at the raw material end is normal; supply: recent Inner Mongolia, Gansu and Shanxi Parking and load reduction devices in other places are mostly restored. The supply of methanol resources in some areas has been enlarged, and the supply of methanol in the main production areas has shown an increasing trend. Methanol analysts from business associations predict that crude oil is on a good trend in the near future, and the domestic methanol market is on the strong side in the short term. Later, we still need to pay attention to domestic methanol plant restart, downstream delivery, port inventory, freight situation and futures trend, and suggest cautious operation.

Price Trend

According to the price monitoring of business associations, as of January 10, the average price of domestic aggregated MDI market was 12,025 yuan/ton. The overall market price continued to rise, and the price fell 58.19% compared with the same period last year.

II. Market Analysis

Products: Domestic aggregate MDI market is narrow upward, spot is extremely scarce, most businesses run empty warehouses, business offers continue to rise, some closures are not reported, downstream demand and hoarders for high prices slightly contradict, inquiry buying gas fell sharply. At present, the barrel-loaded ticket discharging negotiations in Shanghai in North China refer to 12,000-12,200 yuan/ton, and Wanhua PM200 barrel-loaded ticket discharging negotiations refer to the vicinity of 12,500 yuan/ton.

On the market side, a small number of offers in North China Polymerized MDI market continued to move up. Most factories control the volume of goods released, the market spot tension, downstream and intermediaries are more active in hoarding goods, the northern market trading atmosphere is still acceptable. Due to the scarcity of spot, individual middlemen are reluctant to wait and see, and sporadic offers continue to move up narrowly. Eastern China Polymerized MDI market moved up narrowly. The factory controls the quantity of goods released, the middleman delivers more pre-sale orders, has limited spot, sells at a low price, and the odd offer moves up narrowly. In South China, the aggregate MDI market is short of spot and the offer of middlemen is scarce. At present, most middlemen are short, and the price of sporadic offer is higher.

Industry chain: As for raw materials, the domestic aniline Market is on the rise. The price of raw material pure benzene rises, aniline profit falls below the cost line. After the price rises, the factory shipments smoothly, and the downstream pre-holiday replenishment is positive. Aniline prices are expected to rise in the short term. The mainstream reference price in Shandong and North China is 5340 yuan/ton acceptance, while the mainstream market price in East China is 5200-5400 yuan/ton acceptance.

3. Future Market Forecast

Business Cooperative Viewpoint: On the positive side, the factory is still under repair; individual enterprises control the supply, the market spot less. On the bearish side, terminal demand is weak, and the enthusiasm of downstream and middlemen to hoard goods is weakened after price increases. Analysts of business associations aggregated MDI expect that the aggregated MDI market will be consolidated at a high level in the short term.

In 2018, the titanium ore market showed the characteristics of high opening and low going. The price in the first quarter was the highest in the whole year, then slowly fell, and the price at the end of the year was the lowest in the whole year. At the beginning of the first quarter, the declining trend of the titanium market at the end of 2017 was eased, and began to rebound slightly at the end of the first quarter, ranging from 20 to 50 yuan per ton. After entering the second quarter, due to the rapid growth of supply, the price of titanium ore has fallen, and the momentum of decline has continued until the end of 2018.

According to Ruidao data, the average price of ilmenite fell by about 150 yuan/ton at the end of 2018 compared with the beginning of the year. In addition, compared with the previous two years, another feature of the titanium market in 2018 is that the volatility is smaller. According to Ruidao data, in 2016, the difference between the highest price and the lowest price of mainstream titanium ore is close to 1000 yuan/ton, and in 2017 it is about 700 yuan/ton, while in 2018 it is about 250 yuan/ton. The relative stability of raw material price is conducive to the healthy development of the industry.

From the point of view of supply and demand, both supply and demand in the titanium ore market increased in 2018. The growth rate at the supply side was greater than that at the demand side, and the titanium ore inventory increased significantly in 2018. From the perspective of supply structure, it is estimated that the amount of imported ilmenite in 2018 will be almost the same as that in 2017, and the increase of supply will mainly come from the domestic sector. The growth of domestic titanium ore mainly comes from Sichuan and Xinjiang. Among them, the output of Panzhihua area in Sichuan province was reduced by environmental protection factors, but the degree of impact in 2018 was significantly weaker than in 2017; the increase of titanium mineral production in Xinjiang region was due to the new start of mining projects in 2018. According to preliminary statistics of Switzerland, the supply of titanium ore in 2018 is about 5% more than the demand. In the case of excess total supply, the user’s freedom of choice increases, and some low-quality imported titanium ores are difficult to obtain customer orders. The market extrusion effect is obvious.

From the market performance at the end of 2018, some titanium enterprises have intentionally controlled the import volume and output. On the import of titanium ore, Bess resources will reduce the supply of titanium ore in the Chinese market in 2019; on the domestic side, Panzhihua area is affected by the sharp fall in the price of vanadium ilmenite and the local government launched “blue protection” measures. Some local mines will reduce or stop production on New Year’s Day in 2019, and enterprises that have stopped production plan to postpone production until after the Spring Festival. It can be predicted that in January 2019, the domestic supply side of titanium ore will decline, which will be conducive to the maintenance of market prices.

In 2018, the Sponge Titanium Market continued to maintain a good boom in 2017. It is estimated that the domestic production of titanium sponge will increase by more than 7% in 2018, while the production will increase, the price will remain at a relatively high level. As can be seen from the price trend chart, the price of sponge titanium in 2018 is on the rise all year round, and this trend is expected to continue until the first quarter of 2019.

In the first half of 2018, the price of titanium sponge rose relatively smoothly, but after entering the third quarter, the production of titanium tetrachloride declined due to environmental factors, and the price of titanium sponge rose rapidly. Unlike the previous year’s price fluctuations, the price of sponge titanium did not fluctuate significantly in the second half of 2018, mainly due to the shortage of raw materials, resulting in a decline in the production of sponge titanium. After the soaring price of sponge titanium in the past year, the start-up rate of sponge titanium enterprises has also increased, resulting in excess market supply and rapid price decline, which makes it difficult for the whole cycle market to continue for more than three months. After the price rise in 2018, the price of sponge titanium has been running at a high level for a long time due to the restriction of the production of sponge titanium. Some people in the industry have not noticed this new situation, and still use the previous wrong experience to think that the price increase will soon fall back. The author believes that the price of titanium sponge will remain high until the normal supply of titanium tetrachloride or the expansion of chlorination capacity of sponge titanium enterprises.

In fact, the price rise of sponge titanium in 2018 was mainly driven by cost, and the demand side improved after July, which laid the foundation for the upward trend of the price in 2018. At the beginning of 2018, when the price of titanium tetrachloride began to rise, sponge titanium enterprises did not have enough cost transfer capacity. It was not until March 2018 that sponge titanium companies began to try to offset cost pressures by raising prices.

In 2018, the long-term high price of sponge titanium also made people feel hot in the sponge titanium market, but in fact, the profitability of sponge titanium enterprises in 2018 is slightly better than that in 2017, but the increase is limited. The main reason is that the cost of raw materials has risen sharply. In addition to titanium tetrachloride, magnesium ingot prices also increased significantly in 2018, which led to the increase in sponge titanium prices offset by the increase in raw material prices, and limited real profit margins. On the other hand, the affordability of the downstream market also restricts the price of titanium sponge. In the second half of 2018, the domestic titanium market improved somewhat, but the price increase was relatively slow and could not bear the high price of sponge titanium, which to some extent constrained the price increase of sponge titanium.

The trend of increasingly stringent environmental standards will be irreversible, which will lead to the domestic supply of titanium tetrachloride to become normal. In view of this, at present, Zunyi Titanium Industry is gradually restoring the production capacity of titanium tetrachloride, and several other new sponge titanium projects are also full-process projects. Depending on the enterprise itself to ensure the supply of titanium tetrachloride has become the development direction. When these projects are put into operation, the bottleneck of sponge titanium supply will be broken through, and how to maintain the balance between supply and demand in the sponge titanium market will become a new topic.

In addition to the titanium tetrachloride industry, the titanium processing industry in 2018 has also been “cared for” by environmental inspection. Unlike most people’s perception, titanium processing industry was not only affected by environmental protection inspection, but also had a deep impact. Of course, there are many reasons, but this also reminds the industry that environmental friendliness is the prerequisite for the healthy and long-term development of any industry, and can not be excluded because of the small amount of pollution. The environmental protection inspection in Shaanxi in 2018 is just the beginning. Local governments and enterprises need to enhance their environmental awareness. If they do not change their ideas and still cope with the situation in an attitude of coping with the situation, they will suffer again in the future. Perhaps the titanium dioxide industry can provide some lessons from the past. Since 2016, the industry of titanium dioxide has been affected by environmental factors. In 2017, the impact is the most profound. The total output of the industry is restricted by environmental factors, reducing by more than 10%. In 2018, some enterprises have completed the upgrading of environmental protection facilities successively, and then the impact of environmental protection inspection has been significantly reduced. However, some enterprises with unfavorable environmental protection facilities have been continuously restricted in production, further reduced production, and have the trend of being excluded from the market. In view of the fact that some small enterprises have to set up environmental protection facilities separately and the heavy economic burden, they need the assistance of the local government to set up a unified sewage system. Maybe it will take some time to build a new park, but it is better to be late than not.

In 2018, the titanium industry has also ushered in a year of full recovery. Large-scale new projects are emerging. Many regional governments have established industrial bases in order to occupy the highland of this new material field and complete the regional industrial upgrading. In the sponge titanium industry, Pangang sponge titanium plant completed expansion transformation, Zunyi titanium industry successfully relocated as a whole, Shuangruiwanji new project construction completed and partially put into production, together with Sichuan and Xinjiang two new sponge titanium plants completed and preliminary trial production, making the industry enter the expansion period again after 2012. In the titanium industry, Panzhihua, Yunnan, Chongqing, Henan and other places are building new titanium industry bases. Among them, Panzhihua mainly introduces titanium processing enterprises, and relying on the advantages of local mineral resources and sponge titanium origin, strives to make up for the last piece of “jigsaw” in the industrial chain.

Based on the advantages of local non-ferrous metal processing industry, especially in mineral resources, the Yunnan Provincial Government has vigorously supported the development of titanium industry in Chuxiong Prefecture and promoted the new industrial ecology featuring green development. Based on the introduction of talents, technology and capital, Chongqing relies on the industry cluster of “transportation aviation + general aviation, helicopter + fixed wing + unmanned aerial vehicle, manufacturing + operation + service” initially formed in the locality, and strives to build a domestic high-end aviation titanium alloy R&D and manufacturing center. The government of Luoyang City, Henan Province has launched six new policies, which focus on attracting talents and social capital effectively, paving the way for the introduction of talents and striving to build the Titanium Valley of Central Plains. It can be said that after the past five years of depression and dormancy, China’s titanium industry recovered strongly in 2018, sponge titanium production capacity expanded again, high-end titanium project investment continued to increase. With the construction of new projects, a new round of investment in capital, technology and talent will accelerate a new round of industrial upgrading. In the future, the pattern of titanium industry in China will meet new changes.