Tokai Carbon Expects Record Gains From its Carbon Black Business

Tokyo, Japan: Tokai Carbon expects its Carbon Black business to make a gain of up to 30% in the year 2023. Tokai Carbon stated in its shareholders' spring 2023 newsletter that its Carbon Black company had continued to produce record rises in sales and profit in 2022. According to Tokai Carbon, the advances were made amid global economic slowdowns brought on by things like the COVID-19 outbreak and the conflict in Ukraine.

Although new vehicle production fell last year, this was offset by increased demand for replacement tires brought on by increased use of vehicles for the delivery of people and goods, the company reported, which ensured the adequate consumption of Carbon Black during the year. After that, Tokai Carbon concentrated on the U.S., where the company has more than half of its capacity for producing Carbon Black. The U.S. market for replacement tires quickly recovered after the lifting of pandemic lockdowns in 2021, generating a "demand crunch."

Tokai Carbon anticipates tire manufacturing in the U.S. to continue growing at a rate of 2-3 percent per year as the market for new vehicles is also anticipated to recover. It was stated to be "a hard market to serve" due to high transportation costs and rigorous environmental restrictions in the U.S.

Additionally, the U.S. imports of Carbon Black from China and Russia have decreased due to trade tensions with China and the conflict in Ukraine, which means the supply-demand gap in the Carbon Black industry is expected to widen. Since Tokai Carbon owns the biggest Carbon Black factories in the U.S. and has made investments to ensure that its facilities exceed all environmental standards, Tokai Carbon hopes to gain from this circumstance. In the future, the company will strive to offer products with even more added value by incorporating production and facility investment expenses in product prices, ensuring a significant increase in profit.