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Europe is Experiencing a Consistent Rise in Carbon Black Prices. Why?

Europe is Experiencing a Consistent Rise in Carbon Black Prices. Why?

Europe is Experiencing a Consistent Rise in Carbon Black Prices. Why?

  • 09-Sep-2022 3:32 PM
  • Journalist: Timothy Greene

Germany, Europe: European countries have witnessed a steady increase in Carbon Black prices for several weeks. Conversely, In August, when prices of all other petrochemicals were declining owing to excessive supplies, the Carbon Black market continued with its upward trend. As of this week, the cost of Carbon Black Hard Grade N220 has been 2720/MT FD Hamburg, highlighting a rise of almost 1% weekly. Though the downstream demand for Carbon Black from the tire and automotive industries is moderate, the prices have been increasing for so long.

The primary factor behind the inclining value of Carbon Black is the lack of balance between demand and supply dynamics in the domestic market. The downstream demand is not high, it’s in the moderate range, but the supply is low. The supply has been on the lower side since Russia stopped exporting Carbon Black to Europe due to the conflict between Russia and Ukraine. Earlier, European countries imported Carbon Black from Russia at a Cheaper cost. As Russia has better availability of crude oil and LNG, which are key components in Carbon Black Manufacturing, the cost of production is lesser in the country.

Since Russia cut off their Carbon Black exports to Europe, European countries now depend on the USA, South Korea, and its domestic production for Carbon Black demand. However, the imports from the USA and South Korea and its domestic production cost Europe much more than earlier, impacting its price value all these weeks. Besides, Now, the ports are also congested in Europe along with low water levels in the Rhine River and truck and drivers’ shortages, causing further halts in the Carbon Black supply chain.

As per ChemAnalyst anticipations, “The prices of Carbon Black would keep on incrementing in European countries the upcoming weeks as the increase in the cost of production is not going to settle any time soon. Besides, the port congestions and berth delays will continue disrupting the supply chain. Furthermore, Europe fears recession in the upcoming weeks, and if that happens, the prices of Carbon Black will rise even more.”

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