Coal Tar & Carbon Black Price Forecast
Cost Side: Cost Increases Narrow, Support Weakens
The domestic high-temperature coal tar market maintained an overall upward trend, but the increase narrowed significantly, with some sporadic price reductions. Although coal pitch prices continued to rise last week, the market showed some upward pressure. Other downstream products performed poorly, especially industrial naphthalene, which saw continuous declines. Anthracene oil prices struggled to hold up, resulting in narrowing profit margins for deep-processing enterprises. Furthermore, carbon black plants faced increasing losses and gradually lost their ability to compete for raw materials, leading to a significant decline in their willingness to participate in bidding. Consequently, auction prices in some regions began to decline last week, and this week saw some slight price reductions in transactions. Therefore, as the previous positive factors gradually dissipated, coal tar lacked further upward momentum and is currently consolidating at high levels.
The Shandong anthracene oil spot market is unlikely to see significant fluctuations. End-user participation is relatively passive, and transactions remain stagnant. On the raw material side, the price trends of new orders in the high-temperature coal tar market varied across regions, but overall showed a steady upward trend, providing some support to the bottom of the anthracene oil market.
The operating rate of deep coal tar processing plants increased during the week, resulting in ample anthracene oil supply. Holders are currently maintaining a focus on reducing inventory and selling off stock. Looking at the downstream market, new orders in the main downstream carbon black market remain weak, and with the continued rise in coal tar prices, carbon black buyers remain cautious about purchasing anthracene oil.
The anthracene oil hydrogenation market continues to see low-price purchases, with entry into the market being relatively passive. Therefore, there are still no positive factors for the anthracene oil market in terms of demand.
On the demand side: Maintenance companies have resumed operations, and tire manufacturers are increasing their operating rates.
Regarding semi-steel tires, the market was weak due to the month-end transition. The all-season tire market remained weak and stable, with distributors replenishing their stock at the end of the month according to their sales targets, resulting in average channel sales. The snow tire market had ample supply, but demand needs further improvement.
In the all-steel tire market, trading was sluggish. Affected by the seasonal off-season, market demand weakened further. With relatively ample supply, the focus was on digesting existing inventory, resulting in generally low purchasing activity. Market transaction prices remained stable with a slight downward trend. To increase sales and recover funds, some merchants engaged in promotional activities based on their own inventory levels.
The operating rate of semi-steel tires in China is 68%. The operating rate of all-steel tires in China is 64%. The operating rate recovered somewhat this week, with maintenance shutdowns gradually resuming, boosting the overall operating rate. However, overall sales pressure remains, with some companies producing slightly below normal levels. Combined with maintenance schedules for some companies during the week, this limited the extent of the increase in the operating rate.
Market Outlook: Bearish Sentiment Rises, Carbon Black Expected to Decline
In summary, the price of coal tar in Shandong is expected to decline from its high level, but the decline is expected to be limited, with a weak negative impact on carbon black. However, the willingness of end-user tire manufacturers to negotiate lower prices remains unchanged, limiting the potential for further price increases in the carbon black market. The carbon black market is expected to continue operating at a loss.
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