silverspeed03
Boost Junky
- :
- 2008 MS3
Thought this was interesting.
Word is that 12K carbon fiber capacity has been sold out for the past few months and the prices are rising, just as they did in the late 1980s and again in 1996. Some manufacturers are offering fiber to their regular customers on allocation only, with a 10- to 12-week wait for delivery. One manufacturer says the company will supply regular customers only, and has no fiber available for new applications. Standard-modulus fiber that sold for $7.50/lb a year ago is now selling for $10/lb to $11.50/lb, depending on the specific type. One supplier told me his company is trying to hold its increases to 5 percent, but some end users say their increases look more like 40 percent.
Most of the fiber is going into aerospace, of course. Carbon fiber for military applications is certainly in a growth mode, with orders up globally for new planes, helicopters, missiles and unmanned aerial vehicles (UAVs). The commercial aircraft market is strengthening as well: Airbus' A380 nears production and Boeing has committed to build up to 60 percent of the structure of its new, highly efficient 7E7 (slated to enter service in 2008) out of carbon fiber composites. So this situation may prevail for quite some time.
While all of the 12K producers are considering adding capacity, Toray is the only company who has announced its intention to build - its new 4-million-lb per-year facility will come on line in France in late 2005. Because of the relatively large investment (as much as $100 million) and long lead time of about two years, timing is critical to the decision. If a lot of new capacity comes on line at once, as we saw happen in 1998, we get a glut of fiber and depressed prices. This distorts the supply-and-demand equation: It opens the market to new, low-cost end uses but, since fiber sellers are actually losing money, this situation cannot be sustained. Hence, the boom-and-bust cycle the carbon fiber sector goes through, time and again.
Looking at the facts as they stand today, there is a shortage of 12K fiber and some companies (mostly nonaerospace) with projects in the works based on low-cost, small-tow carbon fiber are at risk, once again, of being shut out.
This is the perfect opportunity for the heavy tow manufacturers to step into the void and save some endangered applications. Although there have been significant improvements in the quality and manufacturability of large tow fiber over the last few years, the end user does need to understand the differences. Most likely, some design and manufacturing adjustments will be required. The next 15 to 20 months, when 12K is not available for new applications, may allow heavy tow suppliers and end users to work together to perfect excellent products that will continue to be made of heavy tow. This would be a great advance for the industry. End user understanding and acceptance of carbon fiber products with a range of performance options offered at sustainable prices would help even out the boom and bust, lending stability to the industry as a whole. D.J. DeLong, our "Market Trends" guest columnist (p. 7) suggests that suppliers and end users enter into long-term contracts to secure supply and reduce volatility, an idea that may work in some situations. We're interested in how the situation is impacting your company. To comment, call me at (303) 467-1776 or email judy@compositesworld.com.
On another subject, I wanted to tell you we're holding a drawing for a Apple iPOD 15GB. To enter just go to goComp.biz and register. The random drawing will be held on May 21. We will notify the winner that same day and announce the results in the July issue of HPC. Go ahead and register, you might win. The odds are sure a lot better than the Powerball lottery.
Word is that 12K carbon fiber capacity has been sold out for the past few months and the prices are rising, just as they did in the late 1980s and again in 1996. Some manufacturers are offering fiber to their regular customers on allocation only, with a 10- to 12-week wait for delivery. One manufacturer says the company will supply regular customers only, and has no fiber available for new applications. Standard-modulus fiber that sold for $7.50/lb a year ago is now selling for $10/lb to $11.50/lb, depending on the specific type. One supplier told me his company is trying to hold its increases to 5 percent, but some end users say their increases look more like 40 percent.
Most of the fiber is going into aerospace, of course. Carbon fiber for military applications is certainly in a growth mode, with orders up globally for new planes, helicopters, missiles and unmanned aerial vehicles (UAVs). The commercial aircraft market is strengthening as well: Airbus' A380 nears production and Boeing has committed to build up to 60 percent of the structure of its new, highly efficient 7E7 (slated to enter service in 2008) out of carbon fiber composites. So this situation may prevail for quite some time.
While all of the 12K producers are considering adding capacity, Toray is the only company who has announced its intention to build - its new 4-million-lb per-year facility will come on line in France in late 2005. Because of the relatively large investment (as much as $100 million) and long lead time of about two years, timing is critical to the decision. If a lot of new capacity comes on line at once, as we saw happen in 1998, we get a glut of fiber and depressed prices. This distorts the supply-and-demand equation: It opens the market to new, low-cost end uses but, since fiber sellers are actually losing money, this situation cannot be sustained. Hence, the boom-and-bust cycle the carbon fiber sector goes through, time and again.
Looking at the facts as they stand today, there is a shortage of 12K fiber and some companies (mostly nonaerospace) with projects in the works based on low-cost, small-tow carbon fiber are at risk, once again, of being shut out.
This is the perfect opportunity for the heavy tow manufacturers to step into the void and save some endangered applications. Although there have been significant improvements in the quality and manufacturability of large tow fiber over the last few years, the end user does need to understand the differences. Most likely, some design and manufacturing adjustments will be required. The next 15 to 20 months, when 12K is not available for new applications, may allow heavy tow suppliers and end users to work together to perfect excellent products that will continue to be made of heavy tow. This would be a great advance for the industry. End user understanding and acceptance of carbon fiber products with a range of performance options offered at sustainable prices would help even out the boom and bust, lending stability to the industry as a whole. D.J. DeLong, our "Market Trends" guest columnist (p. 7) suggests that suppliers and end users enter into long-term contracts to secure supply and reduce volatility, an idea that may work in some situations. We're interested in how the situation is impacting your company. To comment, call me at (303) 467-1776 or email judy@compositesworld.com.
On another subject, I wanted to tell you we're holding a drawing for a Apple iPOD 15GB. To enter just go to goComp.biz and register. The random drawing will be held on May 21. We will notify the winner that same day and announce the results in the July issue of HPC. Go ahead and register, you might win. The odds are sure a lot better than the Powerball lottery.
