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PPG Seeks New TiO2 Sources, Options

Monday, December 12, 2011

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The world’s No. 2 paint and coatings company has officially joined the hunt for the world’s No. 1 pigment.

PPG Industries of Pittsburgh has announced a “global initiative” to stabilize and expand its supply of titanium dioxide—an issue critical to the company’s maintaining its profit margins.

 PPG will try to stabilize and expand its supply of TiO2
The paint and coatings industry is the largest consumer of titanium dioxide. Global supplies have been tight—and very expensive—for several years.

TiO2 has been in short supply globally for several years, and every indicator shows prices continuing to skyrocket.

Paint and coating manufacturers worldwide have been waging an uphill battle with the cost and supply of raw materials, led by TiO2, and research into TiO2 alternatives has become a front-burner issue across the industry.

 Dr. Charles F. Kahle II
“Escalating and volatile pricing for titanium dioxide has been an important issue for PPG,” said Chief Technology Officer Charles F. Kahle II.

Titanium dioxide has always been popular for its hiding, durability and whiteness properties. The shortage of recent years has been driven by sharply rebounding demand after several years of curtailed production, as well as fresh demand for its newer uses in anti-microbial and pollution-fighting applications.

Adding Capacity

In May, DuPont Chemical, the No. 1 global producer of titanium dioxide, announced that it would dramatically expand global production of the pigment. The company said it would invest more than $500 million to add production capacity in Mexico and upgrade five other manufacturing sites worldwide, ultimately adding about 770 million pounds of global capacity.

In June, AkzoNobel announced a partnership with a Chinese chemical company to build a new TiO2 plant in Qinzhou, China.

More Shortages, Price Hikes Ahead

In October, Merchant Research and Consulting, a chemical industry analyst, warned in a new market report that supplies of titanium dioxide had reached historically low levels, ensuring continuing price increases.

Titanium dioxide: 2011 World Market Outlook and Forecast up to 2016 noted that current pricing expectations were founded on low inventories of pigment at the beginning of painting season and on supply starved by investment for several years.

“Such tight conditions on titanium dioxide market would lead to rapid price escalation during 2012 and likely 2013,” the study said. “Over the next several years, titanium dioxide producers and feedstock suppliers will escalate margins …”

‘An Important Issue’

Last week, PPG announced that it, too, was taking major steps to address supplies of both sulfite-grade and chloride-grade TiO2.

At the company’s annual capital markets meeting in New York, PPG’s Chief Technology Officer, Dr. Charles F. Kahle II, announced an initiative “with multiple global suppliers” to “secure and enhance” PPG’s TiO2 supply.

“Escalating and volatile pricing for titanium dioxide has been an important issue for PPG,” said Kahle, who also heads Coatings R&D for the company. “PPG possesses intellectual property and expertise in the production and finishing of titanium dioxide pigment, and we intend to leverage this and engage with potential partners to develop innovative supply solutions.”

PPG previously manufactured chloride titanium dioxide at its chemical plant in Natrium, WV.

The TiO2 project may include technical collaborations, joint ventures, licensing, technical assistance or other commercial initiatives, Kahle said.

Reduce, Replace, Supply

As with other coatings companies, part of PPG’s TiO2 strategy is to wean some of its products from the pigment.

In a PowerPoint presentation, Kahle said the company was evaluating latex spacer technology and the use of hollow latex particles to reduce its reliance on titanium dioxide. Working internally and with external suppliers, PPG is working to replace some uses of TiO2 with other technologies.

The issue is critical to PPG’s profit margin maintenance, the presentation notes.

Titanium dioxide is not the only global chemical sourcing project that PPG is pursuing, Kahle’s presentation showed. The company is also pursuing key sourcing initiatives for liquid epoxy resin, fluoropolymers (PVDF) and melamine.


Tagged categories: Anti-microbial coatings; Pigments; PPG; Raw materials; Titanium dioxide

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