THE DIFFICULTY OF BUYING CHINESE TIO2 RUTILES: PART I China has become the biggest TiO2 producer in the

world. From 2006 to 2012, domestic titanium dioxide capacity has increased from 1,300,000 t/a to 2,300,000 t/a. (compared to 4,500,000 t/a worldwide and 1,500,000 t/a for the USA). There are today approx. 60 titanium dioxide producers in China. Most of these producers started as anastase producers and added later on TiO2 rutile when realizing production of anatase was getting overcrowded and facing oversupply. Producing TiO2 rutile is no easy matter; far from it. It requires serious skills, technology and foremost the capitalization to possess: the required equipment (especially for grinding, surface treatment, drying and micronization); the purchase power to buy the needed raw materials; the critical masse (sales) to achieve economies of scale, market presence and share and eventually, profitability to compete. This is the dilemma the Chinese TiO2 industry faces today. Indeed, with the exception of the largest Chinese TiO2 Rutile producers (less than 10), the viability and the remaining 50 producers is highly questionable simply because they are seriously undercapitalized, cost inefficient and therefore uncompetitive. Moreover, their lack of quality consistency continues to be a major issue; especially since the foreign buyer pays 100% of the goods before receiving them and has NO recourse against the seller if something goes wrong. Last but not least, why would one want to start a relationship with a company which might not be in existence in the near future? Indeed, there is a high probability these producers will not survive much longer simply because they are far too numerous and too small. They will either close or be acquired. This consolidation process is inevitable and similar to what happened in the rest of the world where 5 producers today account for over 60% of world production with the rest (China excluded) represented by a dozen producers. So if the above does not deter you from wanting to buy TiO2 Rutile directly (as opposed to buying from an importer/distributor) from a Chinese producer, I strongly suggest you first do some serious research before deciding who you want to buy from (preferably one of the top 5 or 10 Chinese TiO2 Rutile producers). Once you find a producer and identify one or more TiO2 grades which match your requirements, have the producer give you a list of references = endusers you can approach to find out their experience with this Chinese supplier. If this goes well, have the producer then send you a 10 Lb representative sample followed by if this sample tests OK a few 25 kg bags for more serious testing. Stay tuned for more.____________________________________________________________ Jack Blumenfrucht Fairmont International Inc. Fairmont In@aol.com yablum@aol.com