Is it a dream to raise the price of paint? This round of raw material price increases may soon be over

China Paint Online News News
Not surprisingly, this year, especially in the last three months, a round of paint upstream raw material prices, will be curbed at the end of this year, ending the upward momentum. From the supply side of the whole coating industry, the situation of oversupply of raw materials has not changed, and the short-term price increase is mainly affected by the production situation of some enterprises and the structural adjustment of operations.
2015, the global titanium dioxide market downturn, titanium dioxide production enterprises have been repeatedly hit hard, under the pressure of sales, some titanium dioxide enterprises choose to shut down production energy, reduce operating rate to adapt to the market. A sharp drop in supply has led to a rise in the price of titanium dioxide. As of January 2016, the price of titanium dioxide was about 10,000 yuan per ton, and by October, the price of titanium dioxide had risen to 14,500 yuan per ton, a 45% increase.
unusually, TDI, another chemical, has also been on the rise since May this year, soaring - 12,000 yuan per ton in January and 38,000 yuan per ton in October, up 217 percent.
titanium dioxide and TDI (MDI) are important raw materials for coating production and are widely used in coatings, plastics, paper and other industries. As a result, the price increases of titanium dioxide and TDI are bound to put pressure on paint manufacturers. As a result, some paint companies took the opportunity to announce price increases.
recent period, the price of raw materials for coatings has risen beyond everyone's expectations, mainly because some of the world's major enterprises based on operating efficiency and product structure and other factors to make adjustments. Excluding these factors, the global supply of raw materials for coatings is only a temporary oversupply, but the overall oversupply, this situation is not long-term, will soon be suppressed. "There are people in the industry who say.
This person pointed out that this round of paint raw material prices are not sustainable, but to the entire paint industry to bring about reflection: enterprises must establish the ability to deal with various risk shocks, the best means is to play product brand, play high-end brand, improve the proportion of profit products, to ensure the stability of the entire market product price system.
the whole coating industry, the upstream supply of raw materials is still oversupply situation. For example, the production capacity and structural adjustment of titanium dioxide powder has only just begun, and there is no long-term momentum for price increases. Similarly, whether it is building coatings, industrial coatings with titanium dioxide, TDI, resin and other raw materials, the overall is still oversupply, there are no major structural changes.
this round of paint products raw material prices of the channel and power, did not really set up, but in the short term by some of the raw materials industry restructuring, resulting in a short-term price rebound. For example, titanium dioxide and other overall market or oversupply, in this case, any price increase is a short-term factor, do not have long-term power.
understood that this year a number of major TDI international production enterprises to close production capacity. Since April 2016, Mitsui, Japan, has announced the permanent closure of 120,000 tons of TDI in Kashima, Vencorex in France has shut down its 126,000 tons of TDI installations; Repairs; BASF's 300,000-ton/year unit in Germany has been delayed for some reason and is not yet operational; Bayer's unit is in trouble and needs to be overhauled; Covestro's Baytown unit in the US is force majeed to stop; and its 165,000-ton/year unit in Brunsbilt, Germany, will be converted to produce MDI... The closure or contraction of these capacitys has led to a sharp reduction in supply in the foreign TDI market, with other countries and regions switching to Asian sources. As a result, the supply of TDI markets in Asia has tightened, so demand for TDI resources in China continues to increase in Southeast Asia.
According to Li Jianbo, deputy secretary-general of the China Polyurethane Industry Association, the utilization rate of TDI production facilities in China was relatively low last year, with a national level of 70%-80%, mainly due to low product prices, which fell to record lows in 2015 and fluctuated around 12,000 yuan per ton. But Mr Li said there were not many companies that had actually stopped production, "and this year the capacity utilization rate has risen to 80-90 per cent due to a relatively large increase in prices."
industry analysts say that in the short and medium term, from China to the world, TDI, titanium dioxide, resin and other rising channels and support points have not been established. Since this year, some raw material prices, in fact, mainly in the short-term rebound, space and limited capacity, can not confirm that the formation of a rising channel. Similarly, for related industries such as coatings, it is not possible to see large price increases due to the rise in raw materials.
, on the other hand, all paint manufacturers must reflect on this round of rising raw material prices, business management and the ability to deal with risk re-creation and reconstruction. A large number of low-cost competition behavior, can not be sustained, but also can not support, we must establish a step-by-step price competition system.
that is, no matter how much the price of raw materials upstream rises, how much. As a coating giant in the current market, we should establish and have the ability and level to deal with the external market competition, and truly realize the ability to fight risks.
no matter when this round of raw material price increases will end and return to stability. For the market competition and transformation development of Chinese paint enterprises in 2017, this year's rise in raw materials is a new round of positive, can be reflected in advance and forced paint enterprises in the overall operating means and business strategy of the upgrade, the focus of market competition to the middle and high-end consumer demand mining, and promote the continuous optimization of product management structure, by improving the profit margin of individual products to deal with a series of external adverse factors in the future impact.
, it is important to remind again that this round of raw materials rise, is becoming a small number of paint companies to increase prices to dealers, as well as to induce dealers to eat, pressure goods a reason and excuse. For this phenomenon, all paint manufacturers must be vigilant, in the context of external price impact is not long-term, sustainable, must ensure the stability and sustainability of business market operations. Now the pressure of goods, once in the future can not be effectively detonated, will become a "burden."
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