Carbon Black Market Stagnates with High Prices

Market Review: Recently, the carbon black market has seen stagnant new orders, with some major manufacturers lowering their quoted prices. With the Spring Festival approaching, downstream tire manufacturers' purchasing activity has decreased, focusing mainly on small-scale restocking for immediate needs. Demand from other product manufacturers is generally weak, resulting in a sluggish market with both high and low prices, but limited transaction volumes.

Carbon black manufacturers' operating rates have remained relatively stable at low levels. While the raw material coal tar market showed some decline before the holiday, its impact on the carbon black market has weakened. Continued decline in market demand has led to a situation where the carbon black market is expected to enter a phase of high prices but low sales.

Raw Materials: Favorable Factors Gradually Disappear, Market Remains Weak

The domestic high-temperature coal tar market continued its downward trend. With the release of auction prices in Shanxi, the market continued to decline. Most coking plants are still only able to ship enough for 7-10 days. Recent favorable factors have gradually disappeared, and the performance of downstream products remains generally weak.

Deep-processing enterprises are temporarily enjoying small profit margins, while carbon black enterprises are still operating at a loss. Furthermore, downstream stockpiling is nearing its end, while coking plants are increasing shipments.

Coupled with the shutdown of all deep-processing plants in Inner Mongolia, coal tar sales in the region are sluggish. Therefore, negative factors are increasing in the coal tar market, and prices continue to decline.

Demand Side: Factory Operations Remain Weak with Limited Actual Demand

Recently, operating rates have decreased to varying degrees. Some sample enterprises entered a holiday shutdown at the end of January, dragging down the overall operating rate. Pre-holiday stockpiling persists, but shipment performance varies.

For semi-steel tires, increased travel due to the approaching Spring Festival has led to expectations of increased demand, and distributors have stockpiling needs. However, channel sales are generally weak, with replenishment mainly for immediate needs.

For all-steel tires, replacement market demand has further decreased. With the Lunar New Year approaching, the market focus has shifted to cash flow. Distributors stockpiled before logistics shutdowns, leading to increased inventory. Channel sales have decreased, and end-users are mainly replenishing for immediate needs and clearing existing inventory.

Operating Rates: Carbon Black Enterprises See Narrow Adjustments in Operating Rates

Taking Shandong as an example, the price of raw coal tar continued to decline, weakening the cost-driven force. Furthermore, further declines are expected, leading to weak demand and limited market transactions. The carbon black market is gradually entering a state of "high price but low volume," with limited price fluctuations and a theoretically narrowing of losses.

The price of raw coal tar continued to decline, weakening the cost-driven force. Furthermore, further declines are expected, leading to weak demand and limited market transactions. The carbon black market is gradually entering a state of "high price but low volume," with limited price fluctuations and a theoretically narrowing of losses.

In summary: Supply and demand factors are intensifying, pushing carbon black into a downward trend

Looking ahead, the price of raw coal tar continued its downward trend before the holiday, further weakening the cost-driven market. Downstream tire manufacturers are gradually entering holiday season, reducing restocking and further lowering market transaction volumes. It is expected that the market will gradually enter a state of "high price but low volume," with little price fluctuation.

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