2021 Global Iron Oxide Pigments Country Trade Report

Iron oxide pigments, a testament to the development of human civilization, have evolved from early applications in murals, paintings, and cosmetics to current applications in architecture, paints, rubber, inks, plastics, glassware, wood products, and paper products. Their use is particularly rapid in energy storage batteries, catalysts, the electronics industry, and modern medicine, playing a unique role in all aspects of modern economic life. Per capita usage is a measure of a country's and society's level of development. However, 99% of countries and regions worldwide use iron oxide pigments; only 10% manufacture synthetic versions.

1. Analysis of Global Iron Oxide Exports by Country in 2021

1.1 Overview of Country Analysis

In terms of exports, global iron oxide exports increased from US$863 million in 2020 to US$1.031 billion (FOB), surpassing the US$1 billion mark, with a growth rate of 19.5%. Export volume increased from 913,700 tons in 2020 to 1,035,500 tons, a growth rate of 13.3%. The average unit price rose from US$944 per ton in 2020 to US$1,039.51 per ton, a growth rate of 10.1%. Despite the severe impact of the pandemic on the global economy, this has seen a rare increase in both volume and price, demonstrating the market resilience of iron oxide, a coloring material with rigid demand and an emerging functional material.

From a country perspective, 2021 continued to show a high concentration of exporting countries. In terms of market share, 76 countries exported iron oxide in 2021, but the top ten exporters accounted for nearly 87.9% of the global market share. China and Germany held clear industry leadership, maintaining a 65.1% market share. However, Germany's physical export volume growth lagged behind that of countries like China and India. Brazil, led by Germany's Lanxess, even saw negative growth in iron oxide pigment exports. Meanwhile, US physical iron oxide pigment exports saw zero growth in 2021, following negative growth in 2020. After a century of prosperity, the US, a major player in the iron oxide pigment market, is gradually entering a period of decline.

Under the influence of the EU Green Deal, many European chemical companies have implemented austerity strategies in recent years, shifting, abandoning, or liquidating their operations. Even those that haven't implemented austerity strategies have tended to maintain stability, rarely engaging in large-scale expansion and development. Compared to rapidly developing emerging countries, India is experiencing a rapid decline in international competitiveness, with both advances and retreats. In contrast, India, despite a shrinking global market, has bucked the trend and rapidly grown. Leveraging its cost advantages, it has rapidly captured market share in chemical exports across various sectors, including inorganic and organic pigments.

1.2 Analysis of China's Export Status

China is a major producer and user of iron oxide pigments, as well as a major exporter. As the world's largest exporter of iron oxide, China's total exports of iron oxide pigments reached US$396 million (FOB) in 2021, with a total export volume of 352,500 tons. Its contribution to the international market has increased from 33.79% to 38.36%.

By export country, the ranking by total value is as follows: the United States, India, South Africa, Russia, Spain, Vietnam, Germany, Belgium, the United Kingdom, and Indonesia. Further breaking down export regions, North America has become China's largest export target market, accounting for over one-third of exports. Secondly, due to multiple favorable geographical and cultural factors, the European domestic market remains the stronghold and home turf for Chinese iron oxide companies. Countries including the United Kingdom, Poland, France, the Netherlands, and Germany are their largest import destinations. The Asia-Pacific region, represented by China, Japan, and South Korea, also shows a strong preference for German products.

1.3 Analysis of Germany's Export Status

In 2020, Germany's total iron oxide pigment exports totaled US$249.36 million (FOB), with a total export volume exceeding 193,575,815 tons, accounting for nearly 29% of the global market share, making it the world's second-largest exporter of iron oxide pigments.

By exporting country, the ranking by total value is: the United States, China, the United Kingdom, Poland, France, Mexico, the Netherlands, South Korea, Turkey, and Spain.

2. Characteristics and Trends of Iron Oxide Pigment Trade by Country in 2021

Looking back at 2020, it is clear that the spread and persistence of the COVID-19 pandemic have inevitably had a significant impact on global trade and supply chain stability. Affected by this global environment, the overall scale of the global iron oxide market declined, with exports falling by 12.2% month-on-month. Benefiting from my country's effective epidemic prevention and control measures and the resumption of social production, the Chinese iron oxide industry has shown strong resilience, with exports declining by only 0.66% compared to 2019. Overall performance is far superior to that of major competitors such as Germany and the United States.

However, it is worth noting that:

1) In the short term, the demand for key raw materials, production capacity issues, and transportation resource scarcity caused by the post-pandemic era are increasing uncertainty in the global iron oxide supply chain. On the one hand, the expected economic recovery is leading to increased demand for raw materials, adverse weather conditions are leading to a shortage of available raw materials, and several international factory closures have led raw material suppliers to invoke force majeure, exacerbating the supply-demand imbalance. On the other hand, rising international oil prices have led to unprecedented congestion at global ports, making it difficult to secure containers. International shipping rates continue to soar, exacerbating the industry's cost burden. Against this backdrop, Chinese iron oxide exporters face both opportunities and challenges, and in the short term, they enjoy greater bargaining power. In the long term, caution is warranted: importers may shift to countries along the Belt and Road Initiative with lower transportation costs, or opt for domestic production.

2) In the long term, India, leveraging its cost advantages, is rapidly gaining ground in the global iron oxide export market. Its rapid growth over the past two decades has been remarkable, and even during the most challenging period of its own COVID-19 response in 2020, it maintained double-digit growth. Its rapid growth momentum warrants continued attention.

In the future, as the pandemic becomes more commonplace, optimizing and stabilizing the industrial chain and supply chain is expected to remain a significant and ongoing challenge. Perhaps the successful experience of Germany's LANXESS Group in its global production base layout, continuous process innovation, and continuous exploration of new fields and new products will be a model that can be used as a reference and learned from.