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Sudden rising prices of raw materials companies overwhelmed lead-chromium pigment industry brewing price increase measures
After the Spring Festival, international non-ferrous metal futures markets continued to rise sharply, with gold, copper, zinc, aluminum, and lead prices surging. This upward trend has significantly increased the production costs for lead-chromium pigment manufacturers in China, putting pressure on their operations and management. In response, the Lead Coatings and Chromium Pigments Branch of the China National Coatings Industry Association recently organized a conference call with major domestic companies in the sector to discuss industry challenges and coordinate price adjustment strategies.
The products manufactured by these companies include three main types of pigments: chrome yellow, molybdenum chrome red, and zinc oxide. Lead chromate, derived from lead metal, is a key component in both chrome yellow and molybdenum chrome red pigments, accounting for 50% to 60% of the overall product cost. Due to rising global non-ferrous metal prices, the domestic price of lead metal has surged from around 9,200 yuan per ton before the Spring Festival to approximately 12,800 yuan per ton—a nearly 40% increase. This marks the second major jump in lead prices since the second half of 2003.
In addition, the price of molybdate, another essential raw material for molybdenum-chrome pigments, has risen by as much as 30%, while the cost of zinc oxide—used in anti-rust pigments—has climbed by 20%. These sharp increases have put immense pressure on manufacturers, many of whom were already struggling with thin profit margins.
Last year, several companies had to implement price hikes to cope with rising raw material costs. However, the increase in product prices has not kept pace with the soaring costs of materials and other operational expenses. Some smaller firms that relied on minimal profits to stay afloat are now facing losses, and even major producers are finding it increasingly difficult to sustain operations.
Currently, manufacturers are trying to offset rising costs through measures such as improved management, technological upgrades, and product innovation. However, they lack the financial capacity to absorb additional expenses related to waste treatment, safety, and occupational health.
This significant rise in the prices of key raw materials like lead and zinc has further worsened the operating conditions of lead-chromium pigment companies. Industry experts believe that high resource prices are unlikely to decline in the near future, and prices may continue to climb.
Faced with this challenging situation, the Lead-Chromium Pigment Branch of the China National Coatings Industry Association convened a meeting with leading domestic companies. The group decided that each company should adjust its product prices based on its specific circumstances to ensure stable and sustainable operations.