1. 2013
2011
TZMI
Feedstock pressure on the
titanium sponge market
TZMI.COM
DAVID McCOY

2. About TZMI
TZMI provides operational and technical expert
advice on many areas including:
Mergers and acquisitions
Market assessments and industry analysis
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TZMI is a global, independent
consulting
and
publishing
company
with
offices
in
Australia, the US, Europe,
Africa and China. The strength
of TZMI’s consulting services
stems from extensive practical
experience in the mineral
sands, titanium dioxide and
coatings industries and from a
comprehensive
database,
which has been built up over
many years.
having many years of direct
operating experience in the
industry in chief executive,
senior operational, analytical
and marketing roles.
TZMI’s publications and data
services support the consulting
activities and ensure up-todate,
high
quality
and
comprehensive data, analysis
and information across the
mineral sands, zircon and Ti02
pigment industries.
TZMI has proven expertise
gained from our consultants
Associated Companies
Allied Mineral Laboratories
Pre-feasibility studies incl. preliminary capital
and operating cost estimation
Competitive cost analysis and benchmarking
Technical reviews and audits
Resource assessments
Physical separation test work
Flowsheet development
Customised data analysis and reporting
Resource assessment and flowsheet development for mineral sands,
iron or and other heavy mineral deposits.
Oct 2013
ITA 2013 | FEEDSTOCK PRESSURE ON THE TITANIUM SPONGE MARKET
© 2013
2

3. Value of mineral sands production: 1980 – 2012
Considerable value added over last two years.
+160.0%
Beneficiated feedstocks
Iron
Natural feedstocks
Zircon
+104.4%
ITA 2013 | FEEDSTOCK PRESSURE ON THE TITANIUM SPONGE MARKET
© 2013
2012
2010
2008
2006
2004
2002
2000
1998
1996
1992
1990
1988
1986
1984
1982
1980
Oct 2013
1994
+26.6%
+193.5%
3

4. World’s known TiO2 resources
Oct 2013
ITA 2013 | FEEDSTOCK PRESSURE ON THE TITANIUM SPONGE MARKET
© 2013
4

5. Major international suppliers
Oct 2013
ITA 2013 | FEEDSTOCK PRESSURE ON THE TITANIUM SPONGE MARKET
© 2013
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6. New feedstock project activity
Reversal in industry activity from 2011
‘000 TiO2 units &
‘000 tonnes zircon
4,500
Number of
companies
45
4,000
40
3,500
35
3,000
30
© TZMI 2013 NOT FOR REPRODUCTION
2,500
25
2,000
20
1,500
15
1,000
10
500
5
0
0
2000
2001
2002
2003
2004
2005
'000 TiO2 units
Oct 2013
2006
2007
2008
2009
2010
2011
2012
'000 tonnes zircon
ITA 2013 | FEEDSTOCK PRESSURE ON THE TITANIUM SPONGE MARKET
© 2013
6

7. Production of mineral by type in 2012
Rutile
Synthetic rutile
High TiO2 content
mineral is generally used
to make titanium sponge
Sulfate ilmenite
UGS
© TZMI 2013 NOT FOR REPRODUCTION
Chloride slag
Chloride fines
Oct 2013
Sulfate slag
ITA 2013 | FEEDSTOCK PRESSURE ON THE TITANIUM SPONGE MARKET
Chloride
ilmente/leucoxene
© 2013
7

8. Rutile – key to metal value chain
Forecast supply 2013
China
various
Ostchem
IRE
Iluka
Rio Tinto
Sierra Rutile dredge
CRL
© TZMI 2013 NOT FOR REPRODUCTION
Sierra
Rutile
Tronox
Cristal
Oct 2013
ITA 2013 | FEEDSTOCK PRESSURE ON THE TITANIUM SPONGE MARKET
© 2013
8

9. Rutile supply by country
Ukraine
© TZMI 2013 NOT FOR REPRODUCTION
China
Sierra Leonne
India
South Africa
Others
Australia
‘000 tonnes
2012 2013f 2014f
Oct 2013
ITA 2013 | FEEDSTOCK PRESSURE ON THE TITANIUM SPONGE MARKET
© 2013
9

10. Total titanium feedstock demand
Million tonnes
+11.1%
0.0%
6.4
7.3%
5.9%
6.4
7.5%
7.1%
86.8%
85.4%
7.1
6.9%
6.9%
Other
86.1%
Pigment
Ti metal
© TZMI 2013 NOT FOR REPRODUCTION
2012
2013f
2014f
Static demand for feedstocks in 2013 compared to 2012
TZMI is forecasting a significant step up in offtake in 2014
Oct 2013
ITA 2013 | FEEDSTOCK PRESSURE ON THE TITANIUM SPONGE MARKET
© 2013
10

11. Sponge production in 2012
Russia
US
Japan
Kazakhstan
© TZMI 2013 NOT FOR REPRODUCTION
Ukraine
China
Does not include a small pilot plant in India
Oct 2013
ITA 2013 | FEEDSTOCK PRESSURE ON THE TITANIUM SPONGE MARKET
© 2013
12

12. TiCl4 production costs
+27.8%
Other
Utilities
Labour
Chlorine
CPC
© TZMI 2013 NOT FOR REPRODUCTION
CIS
Oct 2013
US
China
Japan
Feedstock
Average
ITA 2013 | FEEDSTOCK PRESSURE ON THE TITANIUM SPONGE MARKET
© 2013
13

13. Sep-10
Oct-10
Nov-10
Dec-10
Jan-11
Feb-11
Mar-11
Apr-11
May-11
Jun-11
Jul-11
Aug-11
Sep-11
Oct-11
Nov-11
Dec-11
Jan-12
Feb-12
Mar-12
Apr-12
May-12
Jun-12
Jul-12
Aug-12
Sep-12
Oct-12
Nov-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
May-13
Jun-13
Jul-13
Aug-13
Sep-13
TiCl4 prices in China
+121.4%
Oct 2013
-52.6%
High
Low
ITA 2013 | FEEDSTOCK PRESSURE ON THE TITANIUM SPONGE MARKET
© 2013
14

14. Take home messages
TiCl4 is the largest cost in the manufacture of sponge and feedstock is the
large contributor to TiCl4 cost.
The weighted average cost of feedstock per tonne of TiCl4 increased by 13%
in 2012. But some sponge producers may have been caught by new
contracts kicking in.
The cash cost of producing TiCl4 varies widely between producers.
TZMI believes we have seen a 20 year peak in rutile costs to sponge
producers.
Oct 2013
ITA 2013 | FEEDSTOCK PRESSURE ON THE TITANIUM SPONGE MARKET
© 2013
15

15. If you squeeze hard enough ……
Oct 2013
ITA 2013 | FEEDSTOCK PRESSURE ON THE TITANIUM SPONGE MARKET
© 2013
16

16. Have you got your reference material yet?
Oct 2013
ITA 2013 | FEEDSTOCK PRESSURE ON THE TITANIUM SPONGE MARKET
© 2013
17

17. 2013
2011
TZMI
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