News from Notch Consulting, Inc.

February 10, 2012

Chinese carbon black delegates visit India

Filed under: Carbon Black — Notch @ 1:22 am

European Rubber Journal (subscription required) reports that a delegation from China’s carbon black industry visited India from 13-19 January, with three companies represented: Jiangxi Black Cat; Hebei Bright, and Shandong Gold. The trip was supported by China’s Ministry of Commerce. The Chinese language article is here, via CRIA, the Chinese Rubber Industry Association. The trip was prompted by ongoing trade disputes between the two countries regarding carbon black, including India’s recent decision to begin an anti-dumping investigation into Chinese carbon black imports.

According to ERJ, the delegates visited Indian carbon black makers as well as tire companies, including Apollo Tyres and JK Industries, as well as the Indian Automotive Tyre Manufacturers’ Association. They discussed at length India’s imposition of special measures on Chinese carbon black imports

According to the delegation, India’s carbon black capacity is 910,000 tonnes/year, but actual production in 2011 was 860,000 tonnes, of which 200,000 was exported. Domestic demand was around 600,000 tonnes. The Chinese delegation concluded that the market is not over-supplied at present.

(Note: these figures are substantially at odds with Notch estimates for the India carbon black market, which are available in the Carbon Black World Data Book 2012, which has just been published. Notch data put Indian production at 717 KT, exports at 115 KT, and domestic demand at 675 KT for 2011.)

Another conclusion is that price is a big factor, but also reliability of regular deliveries. In comparison to Chinese companies, India’s costs – notably the salaries of senior executives – is high, however worker productivity is low.

Indian tyre makers continue to buy Chinese carbon black, but only up to 25 percent of their total requirement. One reason for this is to diversify the supply chain away from India’s domestic suppliers.

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