Continental Carbon ups utilisation rate on growing demand

Taiwan – Taiwan’s leading carbon black supplier Continental Carbon has been upping its capacity utilization rate since this year thanks to growing demand in mainland China, India and the US.

The company’s mainland and India plants both saw deficit last year but are expected to turn profit in the second quarter, said an announcement in April by its parent firm China Synthetic Rubber Corp (CSRC).

The mainland plants, with 285,000 tonne annual capacity, has been running at 70% utilization rate recently. Annual capacity of 50,000 to 60,000 tonne will be added to the plant by the end of this year, focusing on products with higher gross margin such as for truck and specialty engineering vehicle tires.

The announcement did mention any location specifically but the company has three plants in Chongqing; Ma'anshan, Anhui; and Anshan, Liaoning, in China.

The company's plants in India, with 85,000 tonne annual capacity, has been running at 90% utilisation rate and will likely keep the momentum through this year. India’s automotive market is growing rapidly with a number of international auto and tire companies upping their local capacity, said the announcement.

Continental Carbon aims to increase the India plant’s capacity by 2018 yearend as well, and considers India as its major profit contributor for this year, said the announcement.

The company’s US plant with 300,000 tonne annual capacity saw its utilization rate rise to 80% this year.

It also plans to set up research centers at Taiwan’s Kaohsiung and India’s Delhi by 2018 year end, with a total of 50 senior researchers.

The company said in a filing earlier in June that it will be raising capital through the issuance of 180 million new shares in the near term to fund investments in the two countries.

CSRC is planning to inject $155 million (€133 million) into Continental Carbon India Ltd, to expand manufacturing capacity at its production unit in Gujarat .

As for the US investment, CSRC has proposed a capital injection of $52 million (€45 million) to Continental Carbon Co, headquartered in Houston, Texas, to replenish its operating capital.