Carbon Black market move upwards in Europe, European tire manufacturers look for substitute of Russian imports
- 24-Mar-2022 10:19 AM
- Journalist: Peter Schmidt
As per the latest assessment by ChemAnalyst, the Carbon Black market has been termed as firm in the European region owing to strong cost pressure, stable demand fundamentals and limited availability of imports. Carbon black has been majorly employed in tire manufacturing to provide strength and control deterioration.
There has been strong volatility in LNG prices as the supply of Liquified Natural Gas has faced several disruptions since the beginning of the Russia-Ukraine crisis. Limited availability of LNG in the market has put the inflationary pressure and therefore, LNG prices have increased substantially. This has increased the downstream pressure on LNG derivatives and consequently Carbon black market has observed significant price gain in the last few weeks.
Germany, Italy and others have been among key destinations for Russian Carbon Black exports however, Russian imports of Carbon Black has been severely curtailed in the backdrop of the ongoing European crisis.
On the demand side, the downstream tire industry has been firm as replacement tire consumption has increased in early assessments in 2022, however recent automotive industry has again faced output decline in the wake of prevalent semiconductor chip shortage and looming supply tightness of wire harnesses from Ukraine, a key producer of wire-harnesses in Europe. Hence, as of the 3rd week of March, Carbon Black prices were assessed at USD 1465 per MT on FD basis.
As per ChemAnalyst, “Carbon black market is expected to remain firm in the coming weeks as domestic production continues to remain costly while tire manufacturers ponder upon alternatives for Russian imports. Asian imports, particularly, from South Korea and China can fill the import void however increased charges on Suez Canal will exert inflationary pressure on the material reaching European Shores.”