The second big price jump for titanium feedstock in six months will continue to put pressure on sponge production costs in Japan and the West, although the overall impact on the rest of the global industry remains to be seen. Iluka Resources Ltd. said it has reached agreements with its customers for the first half of next year that should result in an increase of its weighted-average price for rutile of between 80 and 85 percent over its average price of about $1,340 per tonne in the second half of 2011. The Australian miner’s first-half 2012 hike for synthetic rutile is 85 to 90 percent over its weighted-average second-half 2011 price of approximately $1,075 per tonne.
While those discussions were concluded with Iluka’s major high-grade titanium dioxide customers in the pigment market, who account for an estimated 90 percent or more of global titanium dioxide consumption, the company noted that it also supplies the titanium sponge and welding industries. Japanese sponge producers, in particular, have blamed feedstock increases for their rising sponge prices, industry sources said.