News from Notch Consulting, Inc.

January 16, 2008

Notch Updates World Thermal Black Report

Filed under: Carbon Black — Notch @ 2:40 pm

Notch Consulting has just published an update of World Thermal Black, which covers the global market for thermal black, a type of large particle, non-reinforcing carbon black manufactured from natural gas feedstocks. The previous edition of this report was published in August 2005. The report provides demand for thermal black by region, market and type (medium and fine) for all years from 2003 through 2007, with forecasts provided for 2008, 2009, 2010, and 2015. An overview and full table of contents for the report can be found here.

I have previously written on this blog about recent activities at thermal black producers Cancarb and Severgazprom.

After several challenging years that saw one major supplier (Sevalco) exit the market, conditions in the thermal black industry improved in 2006-2007 as volume demand grew and natural gas prices moderated from extreme highs in late 2005. From a high of more than $13 per MMBtu (Henry Hub, wellhead price) in 4Q 2005, natural gas prices fell back into the $5 to $7 per MMBtu range for most of 2006 and 2007, which improved margins since suppliers were eating at least some of the higher feedstock costs. Utilization rates improved with Sevalco’s exit, such that one leading producer is now considering adding more capacity. Future growth in thermal black depends on greater penetration of the Asian market. Given that thermal black tends to be used in higher quality goods, demand should benefit as rubber compounders in Asia strive to raise quality to meet global standards.

Request for Information: Notch has heard a rumor that a new company is evaluating a thermal black plant in Asia. If anyone has information on this project, write to me at info AT notchconsulting DOT com.

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