DuPont Raises TiO2 Prices

Recently, Delaware-based chemical giant DuPont (DD) increased prices for all its Ti-Pure® titanium dioxide (TiO2) products sold in Eastern Europe, Middle East and Africa regions. Effective August 1, 2009, or as permitted by the contract, prices in these markets were increased by $150 per ton. This is on top of a $100 per ton price increase announced on May 15, 2009, in Europe and Middle East.

Titanium dioxide is noteworthy for its wide range of applications. When used as a pigment, it is called titanium white. The pigment is widely used to provide whiteness and opacity to products such as paints, plastics, paper, ink, food and toothpastes. It is also used in cosmetic and skin care products, and it is present in almost every sunblock, where it helps protect the skin from ultraviolet light. Titanium dioxide accounts for 70% of the total production volume of pigments worldwide.

DuPont has witnessed stable production rates and inventories for titanium dioxide. Further, the company foresees gradually improving global market conditions in the second half of 2009. These seem to be the driving factors behind the recent price increases.

DuPont Titanium Technologies is the world's largest manufacturer of titanium dioxide, serving worldwide customers in the coatings, paper and plastics industries. Currently, DuPont has 17 products registered under the Ti-Pure® brand.

Crude titanium dioxide is purified through conversion to titanium tetrachloride in the chloride process. DuPont’s chloride manufacturing processes are located in DeLisle, Mississippi; New Johnsonville, Tennessee; Edge Moor, Delaware; Altamira, Mexico; and Kuan Yin, Taiwan.

We continue to recommend DD as Hold with a six-month target price of $25.00.

Read the full analyst report on DD