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Chinese TiO2 Firm Seals Deal with PPG

Friday, December 7, 2012

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China's largest exporter of titanium dioxide has signed off on a deal to license PPG Industries' technology to produce chloride-grade titanium dioxide (TiO2) at its refinement facilities in Henan Province.

Pittsburgh-based PPG announced the deal with Henan Billions Chemicals Co. Ltd. on Wednesday (Dec. 5). Terms were not disclosed.

PPG
PPG Industries Inc.

PPG says the deal provides a commercial opportunity for its technology and expands the global supply of chloride-grade TiO2.

The agreement completes the licensing deal announced by both companies  in June.

At that time, PPG said it would license some of its to Henan Billions and buy back the finished product. PPG also said that it had signed a long-term purchase agreement for titanium dioxide with Billions and that pigment produced under the partnership will be available for sale to third parties.

Expanding Global Supply

“We are pleased to reach this worldwide technology license agreement with Henan Billions as it should expand the global supply of chloride-grade titanium dioxide, as well as provide a commercial opportunity for PPG technology,” said Charles F. Kahle II, PPG chief technology officer and vice president, coatings research and development.

Titanium dioxide is a raw material widely used in the paint and coatings industry as a pigment to provide hiding, durability and whiteness.

Company Connections

Based in Jiaozuo City, Henan Province, Henan Billions is a privately owned enterprise that produces and sells TiO2, zirconium and aluminum sulfate. The company says it has been China's largest exporter of titanium dioxide for three years. Henan Billions is currently a supplier of sulfate-grade TiO2 to PPG, according to PPG.

PPG previously manufactured TiO2 using the chloride process at its chemicals facility in Natrium, WV, and sold titanium dioxide pigment for coatings and other end-use applications.

Henan Billions TiO2 bag
Henan Billions Chemicals Co. Ltd.

PPG said it would license some of its TiO2 technologies to Henan Billions Chemicals and buy back the finished product.

Worldwide Supply Issue

TiO2 manufacturers have enacted sharp increases in TiO2 prices over the past two years as global demand has risen and economic activity has accelerated. Industry experts say prices rose more than 10% in 2010 and an additional 30% to 40% in 2011.

In late 2011, PPG announced a “strategic initiative” to address the global supply issues related to TiO2 pigments, a key raw-material in the supply chain and a major contributor to cost pressures that have cut into profits of coatings manufacturers.

PPG is not the only paint and coatings maker pursuing strategies to address the TiO2 supply situation. In mid-2011, AkzoNobel announced a partnership with Guangxi CAVA Titanium Industry Co. Ltd. of China to build a new TiO2 plant in Quinhou, China. The 100,000-ton-per-year plant is expected to begin operation in early 2014.

AkzoNobel, the world’s largest paint and coatings company, said the move would help to secure its “growing titanium dioxide raw-material needs for the Asian market.” CAVA Titanium Industry is a new arrival in the TiO2 marketplace.

   

Tagged categories: Business operations; Coating Business; Pigments; PPG; Titanium dioxide

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