Carbon Black Capacity Surge: India’s Production to Rise 25–30% by FY27
India’s carbon black industry is gearing up for a significant capacity expansion, with production capacity expected to grow by 25–30% year-on-year between FY26 and FY27, driven primarily by strong export demand and rising specialty grade usage. ETEnergyworld.com
According to a recent report by India Ratings and Research (Ind-Ra), the domestic carbon black sector is shifting focus from standard grades used in tyres to higher-value specialty carbon blacks, used in applications like wires, cables, and engineering plastics, because tyre demand growth remains modest.
Export volumes are playing a key role in this trajectory. India, having become a net exporter of carbon black around FY22, is now benefiting from global supply-chain realignment. For example, Indian exports to the European Union surged from less than 10,000 tonnes in 2021 to about 150,000 tonnes in 2024, as Russian exports to the region were restricted under sanctions.
Currently, India’s carbon black capacity is estimated at ~2.1 million tonnes per annum (MTPA), and the industry expects to add around 0.5-0.6 MTPA of new capacity over FY26–27, with the majority geared for specialty grades.
While domestic tyre demand growth is forecast to remain in single digits, the specialty grade segment and export markets are expected to support margins. Ind-Ra suggests that even as price pressures from lower-cost imports may mount, a higher share of specialty carbon black should help sustain profitability.
For the tyre industry, this development means a more robust raw-material ecosystem: cheaper domestic access to carbon black, larger volumes, and increased focus on specialty grades that may bring newer compound performance possibilities. Suppliers and tyre manufacturers should watch this closely.
Editor’s View
India’s upcoming push in carbon black capacity underscores a turning point in the material-supply ecosystem. As the market expands, tyre makers stand to benefit from greater supply security and possibly downward pressure on cost, but they must also adapt to the rise of speciality grades and evolving compound demands.
For the tyre industry value chain, this is not simply about volume, it’s about quality, performance, and global integration. With India becoming a stronger exporter, the pressure will be on domestic players to match international standards and leverage this bounce in capacity to deliver competitive, high-performance tyres.
