There are new developments in the energy and chemical sectors.

Recently, several leading companies in the titanium dioxide industry have collectively issued price increase notices—domestic customers will see a hike of 700 yuan per ton, while overseas customers will face a direct increase of $100. Longbai Group is taking the lead, with other players like CITIC Titanium and Shandong Dongjia quickly following suit. Even smaller companies like Annada and Jinpu Titanium are getting involved.

The logic behind the price increase is straightforward: upstream raw materials can’t handle the pressure anymore. In November, basic chemical products like sulfuric acid saw prices in some regions soar by 50%, putting immense cost pressure on companies. This kind of passive price hike is completely different from the proactive increases driven by a surge in demand.

However, the market is not optimistic about this round of price hikes.

The problem lies on the demand side—downstream buyers aren’t cooperating, and the industry is about to enter its traditional off-season. Several analysts believe it’s unclear how much of this price increase will actually go through. Price transmission takes time, but the reality is the entire industry is still stuck at the bottom of the cycle.

The current consensus within the industry is that simply relying on price hikes isn’t sustainable; moving towards higher-end products is necessary. Upgrades like the chloride process and CR series technologies are seen as the key to breaking the deadlock. CITIC Titanium’s recent price increase specifically targets its high-end product lines, which is seen as setting a direction for the industry.

The chemical sector may experience some short-term volatility due to this news, but the sustainability is questionable. Cost-driven price hikes are one thing, but whether demand can keep up is another. It’s best to stay cautious and not act impulsively.