Ti02 for Personal Care Performing Well Compared to Rest of Market
The personal care sector uses high-grade Ti02 and this market segment is proving resilient in the downturn
USED TO give opacity and thickness to cosmetics, whitening properties to toothpaste and to provide protection against ultraviolet rays in sunscreen, high-purity anatase titanium dioxide (TiO2) has an increasing number of uses in the personal care industry.
The small but stable sector has provided welcome relief for TiO2 producers, struggling with squeezed margins in the larger, standard-grade markets of paints and plastics, as the as the economic downturn continues its path of destruction on the industry.
Personal care "accounts for less than a tenth of the market," says Thomas Cerny at Kronos Worldwide, a key TiO2 producer, "but it's fairing much better than other applications at the moment."
Most market observers believe that the nature of the applications and limited size of the personal care industry is effectively shielding prices from erosion, unlike those in standard grades, which have fallen over the first quarter as a result of the downturn.
"I don't think the market will be hit hard, even if we slide further into recession a lot of people would go without other things before they give up buying creams, toothpaste and makeup," remarks an area sales manager at Tronox at the recent European Coatings Show in Nuremburg, Germany.
Senior manager of marketing cosmetic raw materials at Bayer MaterialScience, Martin Huttner, agrees; "people never stop buying cosmetics, although the downturn will slow sales a little, it would be in a ratio of around 1-2% if it was a downturn of 5-7% in the entire TiO2 market."
One or two other commentators also highlight that it is the specialist nature of the material and production process that is bolstering the market.
"The mineral titanium is biologically inert. It is neither harmful nor beneficial to humans, making it ideal for personal care products.... Anatase-grade TiO2 [a titanium crystal used as a raw material in TiO2 production] is specifically used for personal care applications as it's less abrasive than the more commonly used rutile grade," explains Reg Adams, founder of pigment market intelligence service Artikol.
"Anatase grade accounts for only 15% of the Western European market," adds Adams. "Combine this with the specific sulfuric acid process [which is necessary for anatase manufacture] and you have a relatively niche market, which protects prices."
Klaus Gripenburg, head of paper and coatings at TiO2 producer Sachtleben, also highlights that "the ongoing replacement of the sulfate process [in Europe, with newer chloride technology] is making material quite niche, creating a speciality opportunity which is better shielded" against the downturn.
As a result, "Prices in this market are much higher," says Adams, "if standard grade sells for €2.30/kg, high-end material would be around €23/kg, but the volumes sold would be dozens of tonnes per year compared to hundreds of thousands in the more standard applications."
While the outlook for the rest of the TiO2 industry remains bleak for much of 2009 and even beyond in some of the worst forecasts, prices in personal care products look set to remain stable or even see some slight strengthening as the summer months bring an improved demand for sunscreen in certain countries, according to one producer.
Long-term growth in the personal care sector is also expected to continue, as consumers call for more mainstream, environmentally friendly products. "Mineral-based make-up is the next big thing as consumers move away from petrochemical-derived ingredients" notes Huttner.
Figures seem to support his theory too, with US sales of these products reportedly increasing from $4.5m (€5.98m) in 2005 to a staggering $149m in 2007.
"There's also a huge growing market for what are termed ethnic whiteners, mainly among Southern Asian and Indian women who are keen to lighten their skin," adds Adams. "These have seen significant growth over the past few years and this will continue."
USED TO give opacity and thickness to cosmetics, whitening properties to toothpaste and to provide protection against ultraviolet rays in sunscreen, high-purity anatase titanium dioxide (TiO2) has an increasing number of uses in the personal care industry.
The small but stable sector has provided welcome relief for TiO2 producers, struggling with squeezed margins in the larger, standard-grade markets of paints and plastics, as the as the economic downturn continues its path of destruction on the industry.
Personal care "accounts for less than a tenth of the market," says Thomas Cerny at Kronos Worldwide, a key TiO2 producer, "but it's fairing much better than other applications at the moment."
Most market observers believe that the nature of the applications and limited size of the personal care industry is effectively shielding prices from erosion, unlike those in standard grades, which have fallen over the first quarter as a result of the downturn.
"I don't think the market will be hit hard, even if we slide further into recession a lot of people would go without other things before they give up buying creams, toothpaste and makeup," remarks an area sales manager at Tronox at the recent European Coatings Show in Nuremburg, Germany.
Senior manager of marketing cosmetic raw materials at Bayer MaterialScience, Martin Huttner, agrees; "people never stop buying cosmetics, although the downturn will slow sales a little, it would be in a ratio of around 1-2% if it was a downturn of 5-7% in the entire TiO2 market."
One or two other commentators also highlight that it is the specialist nature of the material and production process that is bolstering the market.
"The mineral titanium is biologically inert. It is neither harmful nor beneficial to humans, making it ideal for personal care products.... Anatase-grade TiO2 [a titanium crystal used as a raw material in TiO2 production] is specifically used for personal care applications as it's less abrasive than the more commonly used rutile grade," explains Reg Adams, founder of pigment market intelligence service Artikol.
"Anatase grade accounts for only 15% of the Western European market," adds Adams. "Combine this with the specific sulfuric acid process [which is necessary for anatase manufacture] and you have a relatively niche market, which protects prices."
Klaus Gripenburg, head of paper and coatings at TiO2 producer Sachtleben, also highlights that "the ongoing replacement of the sulfate process [in Europe, with newer chloride technology] is making material quite niche, creating a speciality opportunity which is better shielded" against the downturn.
As a result, "Prices in this market are much higher," says Adams, "if standard grade sells for €2.30/kg, high-end material would be around €23/kg, but the volumes sold would be dozens of tonnes per year compared to hundreds of thousands in the more standard applications."
While the outlook for the rest of the TiO2 industry remains bleak for much of 2009 and even beyond in some of the worst forecasts, prices in personal care products look set to remain stable or even see some slight strengthening as the summer months bring an improved demand for sunscreen in certain countries, according to one producer.
Long-term growth in the personal care sector is also expected to continue, as consumers call for more mainstream, environmentally friendly products. "Mineral-based make-up is the next big thing as consumers move away from petrochemical-derived ingredients" notes Huttner.
Figures seem to support his theory too, with US sales of these products reportedly increasing from $4.5m (€5.98m) in 2005 to a staggering $149m in 2007.
"There's also a huge growing market for what are termed ethnic whiteners, mainly among Southern Asian and Indian women who are keen to lighten their skin," adds Adams. "These have seen significant growth over the past few years and this will continue."
quoted from: www.ICIS.com
