Supply and demand, redux

HPC editor-in-chief Jeff Sloan says carbon fiber producers and users need to re-associate.

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CompositesWorld, the publisher of High-Performance Composites and sister publication Composites Technology, hosts the Carbon Fiber conference each year. At the 2010 event held this past December in La Jolla, Calif., two things were clear: Carbon fiber is, arguably, one of the world’s most important and advanced materials. And there is, arguably, no other event that gathers together so many of carbon fiber’s most influential representatives, including many of the world’s largest carbon fiber producers and users. (See HPC's conference highlights by clicking "Carbon Fiber 2010" under Editor's Pick's," at top right.)

Much discussed each year at the conference is carbon fiber supply and demand. Carbon fiber is expensive to manufacture, so producers like to know that there is steady demand for their products. Carbon fiber also is expensive to purchase, so consumers like to know there is adequate supply before committing to its use. This is a delicate balance, and one easily disturbed by the normal ebb and flow of carbon fiber use or non-use — particularly by large players like Boeing and Airbus. Such supply instability can “scare” away potential carbon fiber users who would otherwise use the material if they knew its supply was reliable.

This challenge is compounded by the fact that most of carbon fiber’s future business rests not in the place of its birth (aerospace), but in the more fragmented, disparate and diverse industrial market, which includes wind blades, automotive components, pressure vessels and oil and gas industry tubulars. Estimates presented at the conference by Chris Red (Composite Market Reports) and Tony Roberts (AJR Consultant LLC) show that by 2019, the aerospace market will consume annually about 18 million metric tonnes of carbon, but the energy and industrial market will consume 105 million metric tonnes, with the vast majority of that total committed to wind energy applications. (Roberts thinks the wind estimate is high, Red believes it’s conservative — but even if Roberts is right, the industrial market looks to be dominant.)

However things shake out, it’s clear that the carbon fiber market is in the midst of rapid and substantial change. It’s also clear that managing this change and charting a navigable course for carbon fiber manufacturers and consumers will take some coordination. More than 10 years ago, this coordination was provided by the Suppliers of Advanced Composite Materials Assn. (SACMA). Unfortunately, SACMA was dissolved in 2000, following anti-trust allegations among some carbon fiber producer/members. Since then, the carbon fiber industry has been reluctant to return to the association model.

Present at this year’s Carbon Fiber conference, however, was Paul O’Day, president of the American Fiber Manufacturers Assn. and chairman of its subsidiary, the Fiber Economics Bureau. He made a cogent and compelling case for reorganization, arguing that to do so would help members better understand the supply and demand data picture, and would bring coherence to American policy regarding management of advanced materials like carbon fiber. The thrust of his argument can be found in this issue’s “Market Trends," see "Time for a new 'SACMA,'" under "Editor's Picks"). I think it’s time carbon fiber producers took this message seriously and accepted O’Day’s invitation to try again. Ten years is long enough for the bad taste that SACMA left to fade, and the composites industry’s prominence today demands authoritative leadership to help guide the carbon fiber market through what should be a profitable and exciting new decade.

This column’s headline, however, bears the “redux” tag because one year ago, following Carbon Fiber 2009, I made a similar argument in this column about the need to share supply/demand data. Now, an organization has stepped forward to bear the mantle of responsibility for helping guide the carbon fiber industry though the next several years. This is a great opportunity, and we should not let it pass. And if we do, I’ll be back here next year, with “Supply and demand, redux, part 3.”