The global demand for carbon fiber increased marginally by 1.9% in Q4 2020, compared to Q3 2020. Carbon fiber prices increased by about ~1.5% in Q4 2020 compared to Q3 2020. Airbus and Boeing aircraft deliveries increased in Q4 2020, compared to Q3 2020. However, deliveries are still not up to the benchmark set in Q4 2019. A sluggish demand of carbon fiber was offset by growth in wind energy installation activities during Q4 2020. The figure below depicts the change in demand and the price of carbon fiber in the past five quarters.
Figure 1: Global Quarterly Carbon Fiber Shipment and Price Trends
In Q4 2020, the carbon fiber demand in North America increased from Q3 2020, but the demand was weak as compared to Q4 2019. Aircraft deliveries continued to increase by more than 50%, whereas premium cars sales increased by ~10% in Q4 2020 as compared to Q3 2020. This had a good impact on the carbon fiber demand. Demand for carbon fiber in wind turbine blade and casing applications remained strong.
In Q3 2020, the carbon fiber demand in North America declined from Q2 2020, and also the demand was weak as compared to Q3 2019. All major programs were down substantially with the largest impact related to the A350 and Boeing 737 MAX, which continue to be at a very low level. Build rate reductions driven by the COVID-19 pandemic combined with significant supply chain inventory destocking led to the reduced demand. Additional build rate reductions publicly announced at the end of July 2020 by Airbus and Boeing are further extending the impact of supply chain destocking.
In Q4 2020, demand for carbon fiber improved slightly in the European market compared to Q3 2020, but the demand is relatively much lower as compared to Q4 2019. Light vehicle production, and also wind energy were relatively unaffected. However, aircraft deliveries are still growing at a lower level as Airbus witnessed a decline in deliveries by ~22% in Q4 2020 compared to Q4 2019. In Q3 2020, demand for carbon fiber declined in the European market, due to reductions aircraft build rates. Airbus deliveries in Europe had continued to decline by ~4% in Q3 2020.
In Q4 2020, demand for carbon fiber increased and production activities started to operate at normal levels in the automotive, sporting goods, and construction industries after the damage caused by COVID-19.
In Q3 2020, demand for carbon fiber gained steady speed and the impact of the corona virus pandemic is fading. China’s economic recovery accelerated amid a rebound in domestic consumption, better than expected exports and improving investments. However, the signs of recovery were seen in the later part of the second quarter, and third quarter, the demand for carbon fiber for wind energy applications helped to compensate for the negative trend in other industries.
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