Titanium dioxide pigment faces a new round of price hikes! Huinong Titanium, CNNC Titanium & Vanadium, and Longbai Group all state that the price increase will positively impact their performance—will their stock prices rise?

These figures precisely illustrate that Longbai Group’s real issue today is not 'unsold inventory.' Sales volume continues to grow; what is truly under pressure is profitability. This is also why I find the integration of this employee stock ownership plan (ESOP) with the industry cycle especially intriguing. If performance were assessed solely on operating revenue, employees might meet targets by expanding sales—but low-price sales do not necessarily generate profit. Conversely, if assessed solely on net profit, results could be heavily swayed by sharp external fluctuations in raw material prices—for instance, sulfur or sulfuric acid—over which employees have little control. Thus, Longbai Group ultimately adopted a composite metric: either a 5% increase in revenue *or* net profit *plus* a 5% increase in titanium dioxide sales volume. This effectively evaluates two dimensions simultaneously: whether the company’s overall operations are recovering, and whether the market share of this industry leader continues to expand. In particular, the second target—'a 5% increase in titanium dioxide sales volume'—carries profound industrial significance. In 2025, Longbai Group’s titanium dioxide sales volume reached 1.2621 million tons. A further 5% growth in 2026 would mean expanding sales even within a domestic market characterized by roughly 77% capacity utilization, export headwinds, and ongoing industry consolidation. In other words, this 5% cannot be interpreted merely as typical growth in a high-speed expansion sector. If total industry demand remains flat—or even contracts—yet the industry leader still achieves 5% volume growth, it likely signals continued market share concentration toward top players. That is the true analytical value of this metric. Yet I believe this evaluation framework harbors one issue warranting close observation. Suppose titanium dioxide prices rise in 2026, enabling the company to hit its revenue target—and sales volume also grows by 5%—but sulfuric acid and sulfur costs remain stubbornly high, resulting in no meaningful improvement in per-ton profit. In such a scenario, employees may still satisfy the company’s vesting conditions. That implies: revenue growth and volume growth do not automatically equate to value creation. From shareholders’ perspective, what truly matters in the end is: recovery of per-ton profitability; improved cash flow; expanded market share; and strengthened cost advantages. Therefore, evaluating the ultimate success of this ESOP should not hinge solely on whether 100% vesting is achieved by 2027. We must also look back: What drove the 2026 growth—price increases, volume gains, or cost improvements? Did the titanium dioxide price hike genuinely translate into higher profits? Did the company leverage industry consolidation to broaden its market share? And after core employees receive discounted shares, has the company generated incremental enterprise value exceeding the approximately RMB 443 million in share-based compensation expenses? According to the company’s draft calculation, if all shares are fully subscribed, the total amortized cost of this ESOP is projected to reach RMB 443.3607 million—approximately RMB 110.8402 million in 2026 and RMB 332.5205 million in 2027. That is the real accounting that matters. The company does not implement an ESOP 'for free'; shareholders actually bear substantial long-term incentive costs. So—what, ultimately, does this RMB 443 million buy? If it secures: stabilization of the core team during an industry downturn; further expansion of titanium dioxide market share; increased proportion of chloride-process production; improved cost control; reopening of export markets; and recovery of per-ton profitability;

Frenzied! Coatings and raw materials ignite a 'price-hike wave'!

Recently, China’s chemical, coatings, and waterproofing industry chain has entered a comprehensive price-hike phase. Prices have risen continuously across the entire value chain—from upstream crude oil and basic chemical raw materials, to core inputs like titanium dioxide, and finally to downstream waterproofing and coating products. Multiple industry leaders have collectively issued price-adjustment notices, officially launching a new industry-wide pricing cycle. Titanium Dioxide Leaders Jointly Raise Prices Starting September 11, leading domestic titanium dioxide producers jointly announced price hikes. Longbai Group, Guangdong Huinong Titanium, Shandong Jinhai, Anhui Annada, Guangxi Lanshing Dahua, Nanjing Titanium White, and other major enterprises simultaneously released price-adjustment notifications. The adjustment standard was explicit: domestic titanium dioxide prices increased by RMB 700 per ton, while export prices rose by USD 100 per ton. With uniform price hikes across top-tier firms, the stage was set for broad-based cost increases throughout the coatings industry chain. International Oil Prices Surge Over 6%, Triggering Broad-Based Chemical Raw Material Price Hikes The titanium dioxide price hike is not an isolated event but a key component of a global surge in chemical raw material prices. Driven by persistent Middle East geopolitical tensions and deteriorating global supply expectations, international crude oil futures prices surged sharply—reaching their highest levels since late May. As of the close on September 10, NYMEX October-delivery light crude oil futures rose USD 6.43 to USD 102.48 per barrel—a 6.69% increase; ICE Brent November-delivery crude oil futures rose USD 6.42 to USD 107.63 per barrel—a 6.34% increase. This sharp jump in international oil prices directly propelled broad-based increases in domestic basic chemical raw materials, marked by three features: widespread rises, pronounced tiered differentiation, and high涨幅. This round of chemical raw material price hikes exhibits clear tiered differentiation: alcohols, aromatics, and ketones emerged as the primary drivers, with several key categories posting standout gains. Top-performing categories surged over 20% weekly, led by MIBK with a 25.53% weekly gain; acetone and isopropanol followed closely, rising 24.50% and 23.06% respectively. Over ten mainstream raw materials—including carbon black, propylene oxide, phenol, toluene, and benzene—rose more than 10% weekly, covering core auxiliary materials for coatings and waterproofing industries. Midstream mainstream chemical raw materials generally posted weekly gains of 5%–10%, including n-butanol, propylene, styrene, bisphenol-A, and PX—covering essential solvents, monomers, and plasticizers for coating and waterproofing production. Meanwhile, titanium dioxide, ethylene glycol, TDI, and ethanol saw relatively moderate gains, mostly below 5% weekly; auxiliary agents and inorganic salts—such as anhydrous sodium acetate, flake caustic soda, and soda ash—showed weak upward momentum, with weekly gains under 1%. Coating and Waterproofing Leaders Launch Coordinated Price Hikes Across All Product Lines Sustained upstream raw material price hikes rapidly transmitted cost pressures downstream. Leading Chinese waterproofing and coating enterprises have issued concentrated price-adjustment announcements, with late-September marking a peak window for coordinated hikes. Adjustments cover the full product range—including roll materials, liquid coatings, dry-mix mortars, and rendering mortars.

Valhi’s chemicals sales rose 13%; TiO2 prices increased 4%

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Valhi Inc reported Q2 2026 net income of $22.3 million, driven by a 13% rise in Chemicals Segment sales to $558.1 million. The segment also recorded a 4% increase in TiO2 selling prices alongside higher volumes and reduced costs.

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