(Idea) The Impact Of The War In Iran On Titanium Dioxide Producer Stocks
By: Jon Costello
Without a doubt, the war in Iran is impacting the titanium dioxide market. Notwithstanding today’s news regarding prospects for U.S.-Iran talks, a prolonged war and/or outage in the Strait of Hormuz is still very much on the table. The situation begs the question of how an investor in titanium dioxide stocks should be positioned if the war continues for weeks or months.
As subscribers know, I have been long the titanium dioxide producers Chemours (CC), Tronox (TROX), and Kronos Worldwide (KRO) since late last year, when their stocks were significantly lower than today. I published my recovery thesis in an article published in November. The article made the case that a titanium dioxide recovery was imminent, driven by 1.1 million tons of production curtailments, anti-dumping measures across the EU, Brazil, India, and the U.S., and market-share consolidation among the big three Western titanium dioxide producers.
That thesis remains intact, with evidence now being reported more widely. This is the main reason why the titanium dioxide producer stocks have held up well despite the broader market turmoil, which has hit economically sensitive names particularly hard. Supply and demand are more closely balanced than they have been in years, allowing prices to inch upward. Tronox guided to sequential pricing gains of 2% to 4% in the first quarter of 2026, and Chemours confirmed that its December price increase took hold in the market, with buyers accepting the higher price rather than pushing back or switching suppliers.
So far, all signs suggest that price increases are holding, indicating that the market is in the early stages of a recovery. However, because the recovery is still in its early phase, it remains vulnerable to negative macroeconomic forces. A demand shock from the war in Iran and/or a prolonged outage in the Strait of Hormuz could cause such a setback, which raises the risk for investors in titanium dioxide stocks.
The Sulfur Shock Hits Sulfate Producers Hardest
The war’s most direct impact on titanium dioxide comes through sulfur. Sulfur is a byproduct of oil refining and natural gas processing. The Gulf states account for roughly 45% of global supply. The near-total halt of tanker traffic through the Strait has severely disrupted that supply, sending U.S. sulfur prices up by more than 150% year-over-year to around $500 per metric ton. Prices in Asia have surged by a similar magnitude.
This matters because the sulfate manufacturing process requires approximately 4.0 to 4.5 metric tons of concentrated sulfuric acid per ton of ilmenite concentrate. Approximately 80% of China’s titanium dioxide output uses the sulfate route, and China produces more than 60% the world’s titanium dioxide. The sulfur crisis, therefore, imposes a direct and significant cost shock on roughly half of global titanium dioxide capacity.
The Western majors, namely Chemours, Tronox, and Kronos, use the chloride process, which does not rely on sulfuric acid. As such, they are largely insulated from higher sulfur and sulfuric acid prices. This widens the cost gap between Chinese sulfate producers and Western chloride producers at a time when anti-dumping tariffs of 14% to more than 40% are already squeezing Chinese export volumes.