Kwale-based mining firm Base Resources projects its sales revenues to rise significantly in the next three months largely on strong demand for paint in export markets.
The company said on Friday it expects price uplift for its key minerals, Ilmenite and rutile, in September driven by a “paint season demand” from countries experiencing the hottest weather over the period. “This is when all buildings and structures are being renovated and painted, creating a huge demand for the minerals,” said Base Resources managing director Tim Carstens.
Most rutile and ilmenite ends up as base pigment in paints, paper and plastics, with rutile mainly used to manufacture refractory ceramics. Europe, Russia, US and Canada are among countries on the northern hemisphere that experiences summer from June.
Tightening up of the global minerals market and anticipated rise in productivity from additional exploratory licence are also viewed as indicators to improve prices of Titanium products. “Rutile is looking encouraging, we are seeing indications that it could start to turn up,” said Carstens.
Global prices for titanium products have been on free fall in the last two years by as much as 50 per cent, worsened by a slowdown in China’s economy. Tight competition on pricing saw a tonne of the minerals drop to Sh19,100 from Sh20,800 in the previous years.
Government data shows Kenya exported titanium valued at Sh12.8 billion last year compared to Sh8.8 billion in 2014, defying a 5.4 per cent drop in price.
A Base Resources quarterly report shows rutile production went up by 19 per cent to 85,654 tonnes as Ilmenite rose 6.5 per cent to 455,870 tonnes in the financial year ending June. Zircon production showed the largest growth by 40 per cent to 31,389 tonne despite low prices for the commodity.