Carbon Black (CB) Supply Reductions in China Impact Indian Tyre Manufacturers

Carbon black is used as a rubber-reinforcing agent and performance additive in rubber products (tires, hoses, belts, etc.), coatings, printing inks, extruded profiles, moulded goods, polymer systems and other specialty applications. The latter implies high versatility and contingency of products based on carbon black. With a wide range of applications, carbon black remains critical for tyre manufacturing and the automotive industry.

The latest important news on the carbon black market is how recent plant shutdowns undertaken by the Chinese government in an effort to improve the environmental situation in the country will affect chemical and other industries worldwide.

Carbon black: structure of the global production capacity by region

These shutdowns already affected the supply of carbon black raw materials from China. Carbon black prices in China went up too (there is also an anti-dumping duty on carbon black imports from China).

According to some sources, Indian tyre manufacturers, (they consume certain amounts of Chinese carbon black), were negatively impacted by carbon black supply reductions. India has a range of major carbon black manufacturers, like Aditya Birla Group (carbon black capacity in India: 346,000 mty via SKI Carbon Black and Hi Tech Carbon, affiliated to Aditya Birla Group), Phillips Carbon Black Ltd. (152,000 mty), Continental Carbon India Ltd. (85,000 mty), Goodluck Carbon Pvt. Ltd. (36,000 mty), and Himadri Specialty Chemicals. However, there are allegations that these capacities are not sufficient to cover the existing demand from Indian tyre manufacturers (this demand is currently on the rise).

Some experts argue that the gap between carbon black production and consumption in India for 2018 is around 180,000 mty. The carbon black situation in India tightened when in late December 2017 the Uttar Pradesh Pollution Control Board (UPPCB) has ordered to shut down Continental Carbon India Ltd. carbon black plant in Ghaziabad. However, according to India’s Carbon Black Manufacturers Association (CBMA), this shutdown is only a temporary event. Their experts indicate that Chinese carbon black exports to India is not significant, and India does not experience any carbon black shortages while the above-mentioned manufacturers are able to cover domestic demand in full. The CBMA stresses that these allegations regarding the carbon black deficit in India are erroneous.

More information on the carbon black market is available in the in-demand research study “Carbon Black (BC): 2018 World Market Outlook and Forecast up to 2027”.