In 2015, main economic indicators of carbon black industry had different levels of decline, and the output of carbon black fell for the first time; the sale price sharply declined; the whole industry had a loss; and the value of import and export decreased. It is predicted that in 2016, the situation of negative growth of the previous year will continue, the output of carbon black will be 4.9 million tons, with a decrease of 2%.

1. The output of carbon black fell for the first time

Affected by national economic downturn, especially that export of tire industry frequently encounters foreign anti-dumping and anti-subsidy investigation, tire industry originally with export rate reaching 40% is battered, therefore, the output and sales of carbon black industry also sharply decline. According to the statistics of China Rubber Industry Association (hereinafter referred to as CRIA) Carbon Black Branch, the total national output of carbon black in 2015 was 5 million tons, with a year-on-year (the same below) decrease of 1.94%, the triumphant advance in output of carbon black stopped abruptly in 2015, carbon black industry had its first negative growth in total output since 21th century and the decrease speed was unexpected. See Fig. 1.

Fig. 1: Schematic Diagram of Growth Rate of National Carbon Black Output from 2011 to 2015 

Note: The data comes from CRIA Carbon Black Branch. 

For years, China’s carbon black production capacity has had rapid growth speed, which stagnated in 2015. According to statistics, in 2015, the national production capacity of carbon black reached 6.77 million tons, slightly increased compared with that in the same period of last year, with a growth of only 2.81%, in which the scrap capacity of Qingdao Jiuqi, Chongqing Xingbo, etc. was deducted. In 2015, some planned newly-built enterprises failed to come into production as scheduled, such as Korean OCI, Indian Aditya Birla, etc.

2. The sale price of carbon black continues low and the whole industry has a loss

Along with the economic downturn, the sale price of carbon black is way down. According to the statistics of Carbon Black Branch, in 2015, the member enterprises realized a total sales revenue of 17.2 Billion Yuan, with a decrease of 18%. The decline in sales revenue is much larger than that in sales volume, which indicates that the sale price of the whole carbon black industry continues downward and the sale price has dropped away from the production cost. According to the statistics, in 2015, the average production cost of carbon black was 4,438  Yuan/ton while the sale price was only 4,432 Yuan/ ton, 6 Yuan was lost for production of each ton of carbon black. The sale price declined by 20% in the whole year, thus causing the adverse situation of loss of the whole industry.

According to the statistics of CRIA on each specialized branch, the realized profit of the whole rubber industry declined by 16.99%, the realized profit of tires, cycle tires and rubber hoses & rubber belts decreased by over 10%, in which the decrease in profit of tire industry was the largest, as 23.42%. See Fig. 2 for the profit rate of sales revenue of the industry and each specific industry according to the statistics of CRIA in 2015.

Fig. 2: Profit Rate of Sales Revenue of the Industry and Each Specific Industry According to Statistics of CRIA in 2015 (unit: %) 

3. Both the import and export trade decrease

According to the statistics of the Customs, in 2015, the national carbon black export was 733,500 tons, with a decrease of 12.86%; the export value was about USD 600 Million, with a decrease of 31.88%; the decline in export volume has direct relationship with the sharp slump in international crude oil price. China’s export of carbon black no longer has price advantage, thus losing some markets. China’s main export countries are Asian countries such as Thailand, Indonesia, Japan, etc. as well as European and American countries such as America, Turkey, etc.

In 2015, China’s import of carbon black was 84,100 tons, with a decrease of 18.17%; the import value was USD 210 Million, with a decrease of 17.78%. The decline in import of carbon black is a direct expression of sluggish demand of domestic market, thus adverse situation of international and domestic decline occurs. China’s main import countries are Korea, Japan, America, etc. Seen from the value of import and export, Japan and America are still the main countries for import and export trade of China’s carbon black.