Chemicals (VI): Titanium Dioxide — Profits at the Bottom Amid High Prices

The global geographical distribution of titanium ore resources—and control over mining rights—is extremely concentrated. Geologically, titanium ores (ilmenite and rutile) are primarily found in Australia, South Africa, and China; moreover, 57% of mining rights are tightly held by just a few major players. This high degree of concentration leads to several consequences: First, a large portion of titanium ore supply is locked into long-term contracts (according to market research, accounting for approximately 62%), leaving only a small volume available on the spot market. As a result, any localized geopolitical conflict, environmental regulation, or logistics disruption can rapidly drive up spot-market titanium ore prices—causing sharp volatility in raw material costs for producers without long-term contracts. Second, as high-grade rutile deposits gradually deplete, titanium ore producers must invest heavily in mineral processing technologies; the associated capital expenditures will be passed down the industrial chain, shifting value-added upstream toward mining rights to offset these processing costs. Third, surging downstream demand—for products such as sponge titanium—further intensifies overall demand for titanium ore, squeezing titanium dioxide producers’ access to raw materials and potentially pushing prices upward over the long term. Among current listed companies, Longbai Group—the top-tier player—truly “owns mines,” with 1.72 million tons of titanium concentrate capacity and 380,000 tons of high-titanium slag capacity. Second-tier players include Lubei Chemical, whose 600,000-ton zirconium-titanium ore beneficiation project is nearly complete, placing it close to upstream raw material processing; Huizun Titanium plans to acquire Chenxiang Mineral Resources to enter mine development, but remains in early-stage preparations, carrying significant uncertainty. Third-tier firms—including Anada, Titan Chemical, and Jinpoo Titanium—disclose in their annual reports that they hold no titanium ore resources and rely largely on external procurement. When both titanium dioxide and raw material prices remain simultaneously high, ownership of titanium ore resources determines whether profits can be retained. Specifically, during price increases, externally procuring enterprises may not profit at all; during price declines, vertically integrated, mine-owning enterprises are better positioned to withstand pressure. IV. Trade Tariffs Are Now Testing Companies’ Overseas Expansion Capabilities China is a major titanium dioxide exporter, with total capacity reaching 5.7 million tons and an 82% capacity utilization rate. In 2025, China exported 1.81 million tons of titanium dioxide. Consequently, foreign anti-dumping measures directly impact domestic enterprises’ operations. This year, the European Union finally imposed its final anti-dumping duties on Chinese titanium dioxide. Except for Titan Chemical’s Anhui Jinxing Titanium White facility—which faces an additional duty of €0.25 per kilogram—responding enterprises face €0.64/kg, while Longbai Group and other non-responding enterprises are subject to €0.74/kg, equivalent to roughly ¥6,000 per ton. This tariff effectively erases all export profits for Chinese enterprises shipping to Europe. Yet this does not necessarily make Titan Chemical a more attractive investment: the lower duty may simply reflect its historically lower sales prices and smaller dumping margin. Meanwhile, emerging markets such as India and Brazil—long-standing concerns—have likewise launched anti-dumping investigations against Chinese (rutile-type) titanium dioxide in recent years. Although India rescinded its measure at the end of 2025, its notoriously inconsistent policy stance continues casting a shadow over titanium dioxide exports. Export markets are no longer a safe outlet for China’s excess production capacity. Whether a company can export—and at what cost—has now become a critical differentiator among industry players.

Japan assumed the timing was right and issued a retaliatory order against China—only to find itself unable to withstand the simultaneous pressure from China and Russia.

China and Russia launched military exercises simultaneously—without prior coordination—positioning themselves respectively to Japan’s south and north, delivering a coordinated show of force. Japan had assumed the moment was ripe to act against China—but ended up harming itself. According to Japanese media reports, Japan’s Ministry of Economy, Trade and Industry (METI) and Ministry of Finance officially announced the initiation of an anti-dumping investigation into Chinese-produced rutile-type titanium dioxide pigment. This decision followed careful deliberation: Japan believed conditions were favorable for action against China—yet this sanction order proved utterly incapable of halting China’s 47-day live-fire drills, nor could it withstand Russia’s strategic coordination from the north. Ultimately, Japan’s move severed the very foundation of its own industrial supply chain. Joint Action by Japan’s Ministry of Finance and METI Titanium dioxide is a globally used, fundamental white chemical pigment—indispensable for automotive paint, wall coatings, plastic granules, printing inks, and paper bleaching. Without titanium dioxide, many products cannot achieve uniform whiteness or brightness. The product targeted in Japan’s investigation is specifically rutile-type titanium dioxide—the most widely used variant across industrial applications. Japan chose titanium dioxide as its target mainly because it hosts domestic production capacity. Though Japan produces titanium dioxide domestically, it meets only 24% of its own demand—relying on imports from China for the remaining 76%. This dependence stems partly from the superior quality and competitive pricing of Chinese titanium dioxide, and partly from the industry’s inherently thin profit margins. Japan intended to suppress Chinese enterprises through anti-dumping duties—but overlooked the fact that its domestic producers are marginal and incapable of meeting domestic needs. Consequently, the tariffs it levied on Chinese imports will ultimately be borne entirely by Japanese small and medium-sized enterprises. By contrast, Chinese exports of titanium dioxide to Japan constitute a substantial volume within Japan’s market—but represent only a tiny fraction of China’s overall export supply chain. China can readily redirect this volume to Southeast Asia, the Middle East, and other regions. In short, Japan’s self-proclaimed ‘decisive strike’ holds virtually no weight from China’s perspective. So why did Japan proceed with this move? First, Japan sought to assert national pride: Under Prime Minister Sanae Takagi’s leadership, Japan’s cabinet had been effectively sidelined by China for nearly a year—provoking deep resentment in Tokyo. Second, Takagi aimed to demonstrate resolve to the Japanese public—and particularly to right-wing factions—that Japan would never bow to China.

Japan Launches Anti-Dumping Investigation on Chinese Rutile Titanium Dioxide

Oct 23, 2026

Japan's Ministry of Finance and Economy Ministry initiated an anti-dumping probe on Chinese rutile titanium dioxide on October 16. Analysts indicate limited market impact but advise firms to actively respond and diversify amidst rising trade barriers.

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Japan Launches Anti-Dumping Investigation on Chinese Rutile Titanium Dioxide

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