China Coal Tar & Carbon Black Market Trends
Introduction: At the start of the new year, the domestic high-temperature coal tar market entered a clear upward trend, with an overall optimistic outlook. Following continuous increases in cost prices, new order prices in the carbon black market have also followed suit. However, there is currently significant resistance in the market, with considerable pressure on high-level transactions. Whether actual carbon black orders can continue to rise remains uncertain.
Cost Side: The domestic high-temperature coal tar market continues its upward trend, but the overall increase has narrowed slightly. With the release of high-temperature coal tar prices in Shandong, the market is expected to approach 4,000 yuan per kilogram. The tight supply and demand situation has not eased. On the supply side, the enthusiasm of coking plants to operate is unlikely to increase significantly in the short term, making it difficult to significantly increase the supply of coal tar.
On the demand side, due to the generally low raw material inventories of downstream factories and the upcoming Spring Festival holiday stockpiling, there is still strong rigid demand for coal tar. Furthermore, the operating rates of deep processing and carbon black have both increased. Therefore, the supply and demand of coal tar remains tight, and prices will continue to rise, potentially until the end of the month.
The anthracene oil spot market also has room for further increases, with end-users being relatively passive in entering the market. The high-temperature coal tar market continues to rise, and anthracene oil manufacturers are inclined to further increase prices.
Currently, offers in Shandong and Hebei provinces are pushing up, and the operating rate of coal tar deep processing plants continues to recover, maintaining a relatively high supply level. Downstream, demand in the anthracene oil hydrogenation market is weak, and new orders in the carbon black market are passively increasing.
Influenced by news regarding substitute products, the purchase volume of anthracene oil may increase, reducing the carbon black market's resistance to high anthracene oil prices. However, no purchases have yet entered the market. Overall, the anthracene oil market is expected to continue rising due to raw material factors, but the price increase is already excessive, and the potential for further increases is expected to narrow.
Downstream Demand: The operating rate of semi-steel tire manufacturers in China is 73%, and the operating rate of all-steel tire manufacturers is 63%. As maintenance shutdowns at plants gradually stabilize, output has increased significantly compared to last week.
In the semi-steel tire market, the all-season tire market remained weak, with ample supply. Channels primarily replenished stock to meet immediate needs, while sales at retail outlets were sporadic, and market prices remained relatively stable.
The snow tire market is currently in a phase of digesting end-user demand, with channel replenishment mainly focused on filling stock shortages. Increased export orders for some semi-steel tire manufacturers have helped boost their operating rates.
In the all-steel tire market, transactions continued to be weak. Off-season demand coupled with financial pressures led to low purchasing intentions at all levels of the retailer, with most focusing on clearing existing inventory.
Although some distributors introduced promotional policies to channels, the effects were limited, resulting in overall lackluster market transactions. Some all-steel tire manufacturers saw a significant increase in finished product inventory, leading to some production control measures to limit the extent to which their operating rates could increase.
Market Outlook: Recently, the price of raw coal tar has been rising, leading to high costs and higher new orders in the carbon black market. However, the downstream tire market is still delivering at low prices, increasing pressure on the carbon black market. Some companies are quoting high prices, and actual transactions are mostly small orders at low prices.
Currently, there is significant resistance in the market, and high-priced transactions face considerable pressure. While the price of raw coal tar is expected to continue rising, the potential for further increases is narrowing. Driven by high costs, new orders in the carbon black market will continue to rise.
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