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Overview of the Carbon Black Manufacturing Business in India

The Carbon Black industry provides raw materials for a wide range of industrial applications such as tyres, mechanical rubber goods, plastics, textiles & fibres, pigments etc. Carbon black demand is growing today in the country because of its increased use in various upcoming industries,e.g. tyre manufacturing, plastic manufacturing, battery manufacturing, high-performance coating (paints and ink), agriculture, and computer hardware. Carbon black is a primary reinforcing filler used in rubber compounds, and its fundamental physical and chemical characteristics enhance rubber properties. It is used for reinforcing the elasticity of rubber in tires and also acts as a pigment, conductive/ insulating agent, UV stabiliser, ink and coating applications. The demand for carbon black depends on the process, grade, application and region. The classification of this product is based on the technique by which it is manufactured, i.e. furnace black, acetylene black, lampblack, channel black etc. The furnace black is the most used product, followed by lamp black. Entrepreneurs can easily set up carbon black manufacturing units of any of the above processes depending on the capacity and the investment they are willing to make in the business. But due to the many legal formalities involved in the business, one might need assistance from market experts who knows the ins and outs of the business setup process and the associated legalities. Continue reading to find out the scope of the carbon black manufacturing business and the vast opportunity present in the market.

How is Carbon Black Made

Carbon Black is obtained from heavy petroleum products through thermal decomposition. Raw materials such as ethylene, cracking tar, coal tar, or FCC tar are used to make carbon black. Manufacturing methods include furnace, gas, lamp and thermal black processes. The furnace black process covers about 98% of the world’s annual carbon black production. The feedstock mentioned above is cracked under high temperatures in a reactor, producing carbon black and tail gas. When the small oil drops of the feedstock are heated, they rapidly cleave into carbon black particles, stick to one another, and form a chain structure. Feedstock bases for all carbon blacks are hydrocarbons like aromatic oils based on coal tar or crude oil. The Popular process used by businesses today is as follows.

Thermal black process

In this process, natural gas is fed into the inert chamber of the furnace, where it decomposes into carbon black and H2 or hydrogen gas. The carbon black particles produced from this method have the largest particle size and the lowest degree of particle aggregation or structure.

Channel black process

In this process, crude oil is vaporised in a channel and fed to the burners together with carrier gas. Nowadays, the channel black process is primarily used to manufacture carbon black pigments with very fine particles.

Lamp black process

This is the oldest way to produce carbon black. In this process, heating is conducted on a cast-iron pan with the feedstock. Radiant heat from the hood causes the feedstock to vaporise and combust partially.

Licences and authorisation needed for Carbon Black Manufacturing Business

Registration of the Business: DIC registration of the carbon black manufacturing business will establish a legal identity and make the entrepreneur eligible for various schemes and incentives offered by the government for their business.

Pollution NOC: Industrial carbon black manufacturing businesses, including those which produce associated products like electrodes and graphite blocks and activated carbon, are categorised under the red category of Industry. They must obtain the Pollution No Objection Certificate from the concerned PCC/SPCB. These manufacturing units are mainly air polluting, and the Pollution Index score is normalised to 100. Documents required for this licence include

  • Duly filled Application Form from SPCB.
  • Site or layout plan
  • Detailed Project Report.
  • Details of the manufacturing process and finished products
  • Details of installed waste management measures and pollution control equipment
  • list of machinery, the capital cost of the unit (land, building, and plant machinery)
  • source of water and its required quantity 
  • Land ownership  documents such as rent or lease agreement
  • Industry Registration Documents.
  • Consent fee (as applicable)
  • Balanced Sheet Certified by a CA
  • Lab report of the trade emissions and effluents
  • Any additional document mentioned in the application form

Factory Licence: Every industrial establishment where 10 or more workers are working and a manufacturing process is carried on with the help of power or an establishment where 20 or more workers are working and the manufacturing is carried on without the help of power is required to register itself under Factories Act, 1948. Documents that need to be submitted by the Carbon Black Manufacturing Business for this licence include

  • Online Application form
  •  Requisite fees.
  • ID proof (Occupier and Manager)
  • List of partners and directors
  • Proof of Occupier as the Director, Partner of the factory.
  • Latest electricity bill
  • Proof of occupancy
  • Flow chart of the manufacturing process
  • List of raw materials used.
  • List of machinery installed.
  • CTE/CTO issued by PCC/SPCB
  • Copy of Project Report

Additional Licences and permissions to set up a Carbon Black Manufacturing Business

  • Udyog Aadhar Registration
  • Fire NOC
  • Trademark Registration
  • ISO certification
  • Tie-up with TSDF operator/ HWM authorisation.
  • Import Export Code (if the product is to be exported).

Compounds used to manufacture Carbon Black.

  • Impregnated Pitch: It is a special type of pitch which is a black solid material at room temperature. It is derived from coal tar processing with a low softening point and low QI content.
  • Binder Pitch: Binder Pitch is derived from processing coal tar. It consists of a complex mixture of predominantly aromatic hydrocarbons. It is primarily used to manufacture pre-baked and Soderberg anodes in the aluminium industry.
  • Carbon Black Oil: it is used as Feedstock in Carbon Black Manufacturing Business for manufacturing Carbon Black, which in turn is used in the rubber and tyre industries.
  • Anthracene Oil: Anthracene oil, also called green oil, produces carbon black through the cracking process. It is also a source of phenanthrene, anthracene and carbazole.
  • Creosote Oil: Creosote oil is used as a raw material for making carbon black and is also used for reinforcing a variety of black resins that can be manufactured along with the Carbon Black Manufacturing Business.
  • Refined Naphthalene: Refined naphthalene powder is used as a raw material for the production of various organic compounds like carbon black, SNF, phthalic anhydride, beta naphthol, tanning agents, mothballs and domestic disinfectants
  • Phenol Oil: Large-tonnage engineering plastic such as polyamide and polycarbonate, a wide range of phenolics, and epoxy acid

Market Analysis and Scope of Carbon Black Manufacturing Business in India

The carbon black manufacturing market was estimated to be worth 15,495.32 million USD in 2020 and is expected to grow at a CAGR of 5.15 per cent over the forecast period of 2021-2026. The demand is mainly dependent on industries like tyres and industrial rubber products. As the demand for these products is expected to increase over the forecast period, so will the need for carbon black manufacturing businesses.

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