Australian mining company Iluka Resources reported a decrease in production of its core mineral sands products in the third quarter of 2023. The decline is attributed to challenging market conditions, particularly the weakness in China’s property market.
According to the company’s latest report, the production of zircon, rutile, and synthetic rutile totaled 167,100 metric tons for the three-month period ending in September. This is a decrease from the 216,700 tons produced in the previous quarter and the 143,900 tons produced in the same period last year.
Sales of these products also saw a significant drop, totaling 81,500 tons for the quarter. This is compared to 176,400 tons in the previous quarter and 130,800 tons in the same period a year ago. Zircon is widely used in the production of ceramics such as tiles and wash basins, while rutile products find applications in paints, plastics, and paper.
Iluka acknowledged that global uncertainty, subdued economic activity, and weakness in China’s property market continue to pose challenges to the zircon market. Recent monetary policy changes in China have had limited impact on the real estate sector and have affected domestic ceramic market demand. Additionally, Chinese industrial activity has remained sluggish, leading to lower buying activity in other zircon segments.
Despite the difficult market conditions, Iluka has maintained stable prices for its products. The company remains committed to prioritizing price stability amidst the ongoing challenges.
In an effort to address an uncertain economic outlook and carry out planned maintenance, Iluka has temporarily taken two synthetic rutile kilns offline. These kilns are expected to resume operations in late January.
Iluka Resources anticipates continued headwinds in the zircon market due to global uncertainties and weakened economic activity. The company remains focused on navigating these challenges while maintaining stability in pricing.