Carbon Black Sector Seeks Development in Transformation

By Zhou Minjian, Ding Liping, China Rubber Industry Association

From 2010 to 2015, China’s carbon black output declined constantly for six consecutive years. It stabilized with some increase in 2016, reaching 5.22 million tons, up 4.3% YoY (See Figure 1 for details). The combined output of 13 major producers that year was 3.65 million tons, or 70% of the national total, showing that the industry was already relatively concentrated. See Table 1 for details.
Profits were meager in 2016, and the sales to profit ratio was only 1.65%, the lowest in China’s rubber industry. Eleven branches and 416 major enterprises in the rubber industry earned a combined profit of RMB12.336 billion in 2016, up 11.60% YoY, and the average sales to profit ratio was 5.25%, an increase of 0.40%. The average sales to profit ratio in the carbon black sector was nearly 4% lower than that of the rubber industry as a whole. In contrast, the sales to profit ratio was 3.72% in the tire sector, 7.87% in the rubber product sector and 7.83% in the rubber hose and rubber belt sector, during the same period.

Table 1     Major carbon black producers in China, 2016

Producer    Output (t)    YoY growth (%)
Jiangxi Blackcat Carbon Black Inc, Ltd.    1 026 284    3.87
Shanghai Cabot Chemical Co., Ltd.    560 000    12.00
Hebei Longxing Chemical Stock Co., Ltd.    449 402    10.95
Shanxi Yongdong Chemical Co., Ltd.    202 568    31.29
Suzhou Baohua Carbon Black Co., Ltd.    194 999    -4.02
Shandong Jinneng Science and Technology Co., Ltd.    193 388    6.50
Shanxi Anlun Chemicals Co., Ltd.    188 927    23.66
Shandong Best Chemical Co., Ltd.    182 402    55.34
Shanxi Sanqiang Carbon Black Corporation    152 460    6.78
Dashiqiao Liaobin Carbon Black Factory    148 485    11.89
Yunnan Yunwei Feihu Chemical Co., Ltd.    125 470    155.01
Shandong Nicest Carbon Black Co., Ltd.    123 586    25.04
Shijiazhuang Xinxing Chemical Carbon Co., Ltd.    102 530    4.62
Total output of the above producers    3 650 501    13.24
Total output of other producers    1 570 403    -11.86
National total output    5 220 904    4.3%


Export

China’s carbon black export volume has basically remained stable in recent years. The average export price has however declined constantly, so export value has declined considerably. The export volume in 2016 was 733 kt, a slight drop of only 0.05% from the previous year, but the export value dropped 16.26% to US$500 million. The average export price was US$685/t, down 16.15% from US$817/t in 2015. The top three export destinations were Thailand, Indonesia and Japan, together taking 53% of exports. See Table 2 for details.

Table 2    Major destinations of carbon black exported from China, 2016

Export destination    Export volume (t)    Export value (US$)    Average export price (US$/t)    Proportion of the export volume (%)    Proportion of the export value (%)
Thailand    188 531    122 688 910    651    26.5    3.93
Indonesia    134 661    88 443 594    657    21    1.24
Japan    66 143    47 172 714    713    -17.55    -28.79
Vietnam    63 602    42 138 514    663    21.04    0.89
India    57 370    38 538 706    672    -28.03    -30.93
Taiwan, China    54 113    41 782 549    772    -10.42    -21.33
Malaysia    37 312    24 387 694    654    7.45    -17.12
Korea    25 664    18 928 062    738    -37.97    -45.91
Sri Lanka    13 437    8 542 573    636    0.01    -18.3
Pakistan    11 719    7 855 864    670    -15.46    -28.49
Turkey    9 420    6 779 644    720    -32.38    -44.43
USA    7 583    5 495 015    725    -48.66    -55.04
UK    5 138    3 349 782    652    -18.03    -29.02
Poland    47    77 819    1 666    -99.04    -97.73
Total    674 739    456 181 440    676    -232    -411
Others    58 360    45 955 517    787    232    395
Grand total    733 099    502 136 957    685    -0.05    -16.26


Import

The volume of carbon black imported to China has increased rapidly in recent years. The volume of carbon black imported in 2016 was 90 kt, an increase of 8% over the previous year, according to customs statistics. The top three import sources were the United States, Korea and Japan, accounting for 56% of the total. The average import price was US$2 416/t. See Table 3 for details.
The carbon black sector in China will grow steadily in the future, gaining around 5% this year, 0.7 percentage points higher than 2016. Output will reach 5.48 million tons. The development of the carbon black sector should be guided by market demand. Great attention should be paid both to requirements for high quality carbon black in making “green” tires and to non-tire applications so as to upgrade the industry’s structure.    

Table 3    Major sources of carbon black imported to China, 2016

Import source    Import volume (t)    Import value (US$)    Average import price (US$/t)    Proportion of the import volume (%)    Proportion of the import value (%)
USA    20 426    54 178 898    2 652    18.24    7.29
Korea    17 213    24 758 043    1 438    -7.69    -17.22
Japan    13 560    37 144 736    2 739    13.75    11.47
Taiwan, China    7 855    16 207 206    2 063    -8.85    -10.69
Germany    6 032    22 356 480    3 706    19.64    15.7
Thailand    5 445    5 531 903    1 016    17.48    -24.94
Canada    5 413    9 941 462    1 837    8.05    8.97
Belgium    5 066    25 940 927    5 121    38.37    44.97
Netherlands    2 768    7 384 981    2 668    42.03    25.89
Singapore    2 408    6 711 552    2 787    -13.25    1.88
Russia    1 621    1 762 517    1 087    115.9    46.93
Italy    1 010    2 098 479    2 078    28.43    21.62
Total    68 391    159 838 286    2 337    -16    -20
Others    22 201    59 059 082    2 660    642    881
Grand total    90 592    218 897 368    2 416    7.77    5.76