The titanium dioxide industry is undergoing a deep adjustment phase marked by supply-demand imbalances, persistently low prices, and widespread declines in corporate profitability.
On the evening of October 27, LB Group Co., Ltd. (002601.SZ), a leading titanium dioxide producer, released its Q3 2025 financial report. The company's performance continued its downward trend observed since last year.
Amid earnings pressure, LB Group still held over 7.8 billion yuan in inventory by the end of September, awaiting clearance. In response, the company is doubling down on overseas expansion despite the cyclical downturn. It plans to acquire Venator UK’s chloride-process titanium dioxide plant for $69.9 million and establish subsidiaries in Malaysia and the UK, potentially aiming to mitigate trade barriers and inventory pressure through global expansion.
**Mounting Inventory of Over 7.8 Billion Yuan; Recovery Hinges on Demand Revival** The titanium dioxide industry is experiencing another round of deep adjustments.
Since 2024, titanium dioxide prices have been declining, putting pressure on industry players. Lu Jiaxin, a titanium dioxide analyst at Longzhong Information, noted that sluggish demand from the real estate sector has significantly slowed growth in titanium dioxide consumption. Meanwhile, expanding production capacity and trade barriers—such as anti-dumping measures by the EU and Brazil—have exacerbated the supply-demand imbalance.
Financial data shows that LB Group’s net profit attributable to shareholders fell by 32.79% in 2024 and 19.53% in H1 2025. In the first three quarters of this year, net profit dropped 34.68% year-on-year to 1.674 billion yuan, continuing the downward trend.
The earnings pressure is not unique to LB Group. Among major A-listed titanium dioxide producers, Huiyun Titanium (300891.SZ), Anada (002136.SZ), and Vanadium Titanium (000629.SZ) swung from profit to loss in the first three quarters, while Titanium Chemical (002145.SZ) also reported declining profits, reflecting industry-wide pressure.
Industry sources reveal that amid oversupply, companies are maintaining production despite low prices to retain market share, leading to inventory buildup. LB Group’s inventory has risen steadily from 6.547 billion yuan at the end of 2022 to 7.854 billion yuan by September 2025.
Lu Jiaxin commented, "Although domestic titanium dioxide prices saw two rounds of hikes in late August, the actual increases fell short of announced targets. With the end of the traditional peak season (‘Golden September, Silver October’), prices may enter another downward phase."
"It’s difficult to predict when inventory levels will normalize, as end-demand has yet to show fundamental recovery," Lu added. However, she expects gradual improvement as industry consolidation accelerates and downstream demand slowly rebounds.
**Strong Export Performance Drives Counter-Cyclic Overseas Push** Despite earnings pressure, LB Group remains committed to global expansion. On October 17, the company announced two overseas initiatives:
1. Establishing subsidiaries in Malaysia and the UK with investments of $5 million and $50 million, respectively. 2. Acquiring Venator UK’s titanium dioxide-related assets for $69.9 million through subsidiary Billionseurope Ltd., with additional taxes and fees estimated at $14.19 million.
Venator UK, part of one of Europe and America’s top four titanium dioxide producers, operates the only chloride-process titanium dioxide plant under Venator, with an annual capacity of 150,000 tons.
As of August 31, 2025, the acquired assets had an original book value of approximately $534 million, accumulated depreciation of $339 million, and a net book value of $195 million. The facility is currently in the process of being idled.
LB Group previously stated that it is actively pursuing overseas expansion, having completed preliminary due diligence in multiple regions. The company aims to strengthen its global industrial footprint and sales network to capture higher market share.
However, overseas revenue accounted for 40.94% of LB Group’s total in H1 2025, down 10.78% year-on-year.
Lu Jiaxin noted that China’s titanium dioxide exports remain robust, helping alleviate domestic supply pressure and supporting prices. Additionally, setting up overseas plants allows producers to bypass anti-dumping tariffs, integrate global resources, and achieve synergies.
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