China's carbon black industry will continue to maintain rapid growth in 2007


The carbon black industry has developed along with the development of industrial rubber, especially the rapid development of tire rubber (carbon black for tires accounts for 65%-70% of the total demand for carbon black). In 2006, China's tire industry achieved sales growth of 27.05% year-on-year, maintaining rapid growth and driving the rapid growth of the carbon black industry.

According to statistics of the China Tire Industry Association Carbon Black Branch, as of the end of 2006, the national carbon black production capacity has reached 2.77 million tons, of which wet carbon black capacity exceeded 2 million tons for the first time. In 2006, the total carbon black output in the country reached 18.52 million tons, an increase of 24.2 million tons over the previous year's 1.61 million tons, an increase of 15.03%. In 2006, carbon black enterprises above designated size achieved sales revenue of 8.285 billion yuan, a substantial increase of 77.58% year-on-year, mainly due to the increase in the price of carbon black.

From the perspective of the main raw materials of carbon black, the price of coal tar has declined sharply in the fourth quarter of 2006, the oyster sauce has declined to a certain extent, and the fuel oil has fallen dramatically. This effectively relieves the pressure on carbon black production costs.

Carbon black industry will continue to maintain rapid growth in 2007. As domestic automobile consumption continues to increase, the automobile production capacity will further expand in 2007, and the tire industry will continue to maintain rapid growth, which will promote the rapid development of the carbon black industry. In addition, the prices of main raw materials, coal tar, oysteroil and fuel oil, are expected to be lower than the level of 2006 in 2007, and the gross profit margin of carbon black products will continue to rise, and the industrial boom degree will be upward.

The global carbon black industry has a high degree of concentration, but China's industry concentration is very low, and there are promising future enterprises. The carbon black industry currently has two listed companies: Black Cat (002068) and Haiyin (000861), of which Black Cat is the absolute leader.

Black Cat (002068): The company is the absolute leader in China's carbon black industry. In 2006, carbon black products ranked first in the industry in sales revenue, accounting for 12.71% of the revenue of companies above designated size; the company's production lines are encouraged by the national rubber industry. The wet carbon black production line has a large scale of production for a single production line, with obvious advantages in technology and scale. With the gradual production of raised capital projects, the company's production capacity will continue to expand, and its performance is expected to maintain rapid growth.


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