【 Introduction 】 In May, there were mostly negative factors in the Carbon Black market, mainly due to the continuous decline of high-temperature coal tar raw materials on the cost side and weak downstream demand. The trading center of the carbon black market shifted downwards, and in the future, carbon black may still be constrained by the downward trend of raw material oil and the difficulty of improving enterprise shipments. It is unlikely that its market price will stop falling and rise.
Recently, the price of carbon black in the market has been declining. As of the close on May 17th, the price range of carbon black N330 in the Shandong market was 8100-8300 yuan/ton, with an average price drop of 400 yuan/ton compared to early May, a decrease of 4.65%; Compared to the same period last year, it increased by 1300 yuan/ton, with a growth rate of 18.84%. The main driving factors that cause market changes include: the overall decline in the price of high-temperature coal tar on the raw material side during the month, the increased downstream bargaining and wait-and-see sentiment of carbon black due to the loosening of the cost side, and the main trend of carbon black market prices following the falling cost; Downstream tire procurement enthusiasm is not high, and many product enterprises have small orders for replenishment, which overall drag down the demand for carbon black; Most carbon black enterprises have stable production, but due to downstream demand suppression, their shipments are slow, and some manufacturers have high inventory. Negotiations in the carbon black market are passive, and the market focus has shifted downwards.
Weak decline in raw material coal tar prices and weak cost support
In May, the commercial investment in the high-temperature coal tar market for carbon black raw materials was relatively weak, and its prices fell back. As of the close on May 17th, the price of high-temperature coal tar in Shandong region was 4700 yuan/ton, with an average decrease of 110 yuan/ton from the beginning of the month, a decrease of 2.34%. The main influencing factors of the price changes of high-temperature coal tar are: on the one hand, during the pricing cycle of carbon black enterprises at the beginning of the month, the prices of coal tar in the main production areas stabilized and slightly declined in some areas; On the other hand, as of May 17th, the weekly operating load of coke enterprises was 73.7%, driving an increase in coal tar supply. However, downstream deep processing and carbon black sectors are operating at a loss, and their ability to undertake coal tar is insufficient. Especially, the enthusiasm for deep processing and receiving goods is average, leading to a decline in coal tar prices.
Fundamental Weakness in the Game of Supply and Demand
From the demand side, the resistance to shipment in the downstream all steel tire market for carbon black has increased in May. Although its production has gradually resumed after the holiday, limited space for improvement in production is limited due to inventory pressure, which further affects its poor purchasing sentiment for carbon black. In terms of supply, some large carbon black factories have recently undergone equipment maintenance, but in the early stage, the maintenance of large factories in Shandong and Hebei regions has ended, and construction has gradually resumed. The supply-demand contradiction of carbon black is still prominent, and the shipment performance of carbon black enterprises is not ideal, with some enterprises experiencing a significant increase in inventory.
The short-term cost side may continue to decline, and there is room for a decline in the carbon black market
In the short term, in terms of cost, the coke market remains stable in terms of trading, and coke companies may continue to increase their production. There is an expectation of an increase in the supply of high-temperature coal tar. However, under the pressure of significant losses in downstream deep processing, the bargaining operation of coal tar continues, and the price of coal tar continues to decline weakly in the short term, which has a negative impact on the price of carbon black market; In terms of supply and demand, downstream tires have a general willingness to undertake carbon black, while product companies are affected by the trend of coal tar prices, resulting in low stocking intentions. Dealers are also constrained by cautious entry into the market due to terminal demand. Carbon black companies have poor shipments, and the supply side is relatively abundant. The short-term market may continue to be weak due to weak carbon black fundamentals.
