This week, the carbon black market prices have mainly fallen As of the 16th, the domestic market price of N220 carbon black was at 10807.14 yuan/ton, a decrease of 7.57% from the beginning of the week at 11692.86 yuan/ton, and a year-on-year increase of 49.27%.
In terms of raw materials, the high-temperature coal tar market has been operating strongly this week. The auction price of high-temperature coal tar in Shanxi was 5600 yuan/ton, an increase of 190 yuan/ton from last week; The price increase in Inner Mongolia region reached 370-400 yuan/ton. The mainstream negotiated price in the Shandong market remains at 5450 yuan/ton, and downstream deep processed products have all risen. The profitability of enterprises has recovered, and merchants have stable entry and receipt of goods. Coal tar accounts for about 65% -80% of the production cost of carbon black, and the cost side provides strong support for the price of carbon black.
On the supply side, the operating rate of the carbon black industry this week was 57.43%, an increase of 1.19 percentage points from last week. Some early-stage maintenance companies have maintained production cuts, and some large factories are expected to increase production, but the overall operating rate is still at a medium low level. The profits of coke enterprises continue to shrink, with the national average profit per ton of coke falling near the breakeven line, and production restrictions continue to constrain the increase in coal tar supply. Carbon black companies have suffered losses from executing low-priced orders in the early stages, and mainstream large factories have a strong willingness to push prices up. The supply side presents a pattern of “low production and strong price support”.
In terms of the terminal market, the capacity utilization rate of tire enterprises has significantly rebounded this week, with a capacity utilization rate of 57.80% for the sample semi steel tire enterprises, a significant increase of 33.28 percentage points compared to the previous week; The utilization rate of all steel tire production capacity was 53.31%, an increase of 26.67 percentage points compared to the previous period. However, there is still a significant decline compared to last year, and downstream tire companies have high finished product inventories. Purchasing is maintained at the same time, and overall stocking sentiment is average. Purchasing for essential needs is cautious, and new orders in the carbon black market are not smooth. The demand side shows the characteristics of “month on month improvement and year-on-year weakness”.
Influencing factors: The core contradiction in the current carbon black market lies in the game between rising costs and weak demand. On the one hand, the price of coal tar continues to rise, with a cumulative increase of about 45% in September for high-temperature coal tar in Shandong. Correspondingly, the cost of carbon black has increased by 3000-4000 yuan/ton, and carbon black enterprises are experiencing intensified losses, indicating a strong willingness to raise prices. On the other hand, tire companies are facing the dilemma of high raw material prices and immediate losses. Taking 12R22.5 all steel tires as an example, the production cost of a single tire is about 989 yuan, while the wholesale price is only about 909 yuan. Selling one tire results in a loss of about 80 yuan. The price increase of carbon black is hindered from being transmitted downstream, and the market is in a stalemate of “cost support, no demand drive”.
Outlook for the future: This week, the carbon black market is showing an operating pattern of “strong cost and supply-demand competition”. The center of gravity of coal tar prices on the raw material side continues to shift upwards, forming a rigid support for carbon black costs; The operating rate of the supply side has slightly rebounded but still remains low, and the mentality of enterprises to support prices is clear; The demand side tire production has significantly recovered on a month on month basis, but is relatively weak compared to the same period last year. The procurement is mainly based on rigid demand, and the acceptance of high priced carbon black is limited. In the short term, the raw material coal tar market is expected to operate steadily with a moderate to strong trend. There is still some support for the release of inventory replenishment demand from deep processing enterprises, and there is an expectation of an increase in inventory of new carbon black orders. However, downstream tire companies face enormous cost pressure, and the transmission of price increases is not smooth. The upward space for carbon black prices may be constrained by the acceptance of the demand side. It is expected that the carbon black market will be dominated by strong consolidation next week, with limited growth.
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