DKSH cooperates with Australian TNG to exclusively market titanium dioxide, page-34

Good find. Some big numbers floating around there.

It's clearly an MOU, and NOT a binding offtake agreement. Hence the lack of market interest.

I feel the use of the word "binding", is rather deceptive and shouldn't have been used.

Still, production estimated to start in 2022. Just around the corner ...

Translated:

DKSH sells titanium dioxide for Australian TNG specialty raw material

29.10.2018 10:03

Zurich (awp) - The trading group DKSH has been commissioned by the Australian commodity company TNG to market titanium dioxide (TiO2). According to a market observer, this could become "an interesting story" for the sector in a few years' time.

The two companies have agreed a memorandum of understanding for an annual capacity of up to 150,000 tons. The DKSH Business Unit Special Raw Materials will be responsible for marketing and distribution, distribution and logistics as well as technical support for the life of the mine, as stated in a statement from Monday.

The titanium dioxide is mined at Mount Peake in the northern part of Australia. With the exception of the Iberian Peninsula and Scandinavia, DKSH will distribute the raw material worldwide to the coating industry.

According to the announcement, TiO2 is a naturally occurring titanium oxide and the world's most widely used white pigment. It is used in paints, plastics, laminated paper, printing inks and fibers, among others. Quality features such as opacity, gloss, water resistance and abrasiveness are mentioned.

Sales potential seen at 450 million francs

On disallowed, DKSH on Monday add 0.5 percent in early trading. The SPI stands at the same time 0.9 percent in the plus.

While DKSH has a worldwide customer base in the area of "Performance Materials" and does not focus solely on Asia, the company usually sells specialty chemicals in smaller volumes, Vontobel comments on the news. Should the deal come about as planned, the scope could increase considerably. In view of the "attractive profitability" of specialty raw materials, this could be interesting for DKSH in a few years' time.

The product is not available until 2022, and further details would have to be negotiated, writes the responsible Vontobel analyst. With a price of 2000 to 3000 francs per ton, a sales potential of up to 450 million per year can be calculated. This corresponds to around 3 percent of Group sales.

However, according to DKSH's strategy, there are no investments associated with the contract except an increase in the number of staff involved.
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