top of page

Tightness in North American Carbon Black Market Causes Scramble

Over the last month, and particularly over the last two weeks, the North American carbon black market suddenly grew quite tight, a situation that left tire companies scrambling to find material in a market where little was available. More than one carbon black supplier told me that they were turning away buyers as they worked to fulfill their own contracted volumes. The shortage appears concentrated in tread grades, though carcass is also tight for some grades. The temporary shortage grew from a confluence of factors, which I have listed below.

1. The US manufacturing sector continues to rebound, with particularly good growth in April. It seems that the robustness of the growth has taken many industries by surprise. 2. Both the tire industry and the carbon black industry emerged from the recession with very low inventory levels, and producers have been very cautious about building up excess inventory until the recovery proved that it was sustainable. 3. For carbon black producers, these low inventory levels mean that they must produce shorter runs of more grades to meet new demand. So instead of running at an ideal rate of, say, seven to ten days at a single grade, which allows them to optimize energy usage and reduce off-spec, they may be forced to produce shorter two-to-three day runs, which increases off-spec and greatly reduces throughput. 4. Add to these factors the fact that the long downturn and an aggressive pricing environment have meant that carbon black producers have not always had adequate funds to keep plants in peak condition, a situation that has led to unexpected downtime.

With Concarb bringing an idled unit back on-stream this month, the shortage should be temporary, as there does appear to be adequate capacity to meet demand. But the long term viability of the carbon black industry is also dependent upon a pricing environment that is more conducive to reinvestment.

3 views0 comments

Recent Posts

See All

Notch blog moves to Wix

Our blog, News from Notch Consulting, has been published continuously since November 2007 with free news and updates related to the tire, rubber, carbon black, silica, and rubber chemicals industries.

Webinar: Recovered Carbon Black for Investors

Notch will join the discussion for a new webinar, Recovered Carbon Black for Bankers & Investors. The time is Tuesday, January 24 at 8 AM EST (14:00 CET). The webinar will provide an introduction to c


bottom of page