Carbon Black Shortage Creating Headaches in India

The New Indian Express newspaper has reported a “severe crisis” looming over India’s tyre and tread rubber manufacturers. According to the newspaper, carbon black supplies are critically low and the four major Indian manufacturers of the substance lack the capacity to meet domestic market demand. This problem is compounded by allegations that India’s Ministry of Commerce is preventing the importation of carbon black to compensate for this shortfall.

A number of factories are said to have been idled as a result of this shortage, which The New Indian Express attributes to a Ministry of Commerce decision to restrict carbon black imports if the landed cost is less than RS 80 (£1.00) per kilogram, markedly more than the current Indian price. Furthermore, the Ministry’s director general of Anti Dumping and Allied Duties decided on May 25 that an Rs 6,000 (£75.10) per tonne anti-dumping duty should be imposed upon carbon black imported from Australia, China, Russia and Thailand.

These decisions have increased dependency upon Indian carbon black manufacturers, and the newspaper reports allegations of cartel-like behaviour amongst these companies, whom it says are “free to raise their prices at will.” Price increases of some 12 to 13 per cent have been noted, and supplies to smaller manufacturers have allegedly been restricted.