Carbon fiber is an interesting chemical fiber. Much thinner than human hair, carbon fiber is strong, stiff, lightweight, chemically resistant and formable, making it a sought-after material for many applications. Most structural carbon fiber today is made from PAN (polyacrylonitrile) – which makes up > 95 % of the world’s carbon fiber. Most carbon fiber producers are parts of big global chemical companies.
How did we get here? In 2019, global demand for carbon fiber totaled approx. 105,000 tons for a variety of industrial applications: wind energy 23 %, aerospace 20 %, sporting goods (incl. marine) 12 %, automotive 10 %, pressure vessels 10 %, compounding for injection molded plastics and other short fiber applications 8 %, construction and infrastructure 8 % and other market segments 9 %. By 2019, industry sales of carbon fiber were nearly US$ 3 billion, and composite materials and structures incorporating carbon fiber was a $ 15 billion industry. Growth has been smooth and uninterrupted, increasing 10-12 % each year. It’s been up, and up, and up.
And then, at the beginning of 2020, the Covid-19 pandemic struck. The world changed instantly and dramatically. The carbon fiber world was impacted too. With national lockdowns and international borders shut to contain the virus, international air travel stopped, aircraft were grounded, aircraft manufacturers Airbus and Boeing slashed production rates and, in an instant, the carbon fiber industry lost its great driver. Carbon fiber use in aerospace applications makes up 20 % of industry volume but 40 % of industry value due to the high unit values of the high-performance certified quality of aerospace products. While the commercial aerospace news was depressing in 2020, new installations of wind turbines were up more than 40 %. Moreover, demand for sporting goods including boats jumped 30-40 %.
Altogether, with aerospace down, and wind and sporting goods up, overall demand for carbon fiber was about 1 % higher in 2020 than in 2019. Furthermore, for 2021, we again expect about 1 % growth. Where are we going? Underlying demand for lighter, stronger materials is a strong pull for carbon fiber and the carbon fiber industry. Aircraft fuel savings pays for the investment in low weight carbon fiber composites many times over during the life of an airframe. The same story goes for wind turbine blades – it allows for reductions in the use of other conventional materials and the stiffer blades generate more clean energy – resulting in positive economics overall.
What about carbon fiber in automotive applications? Electric vehicles laden with hundreds of kilograms of batteries need low weight structures as that offered by carbon fiber. However, the carbon fiber industry is still in its development phase. Aircraft are hand-built at a rate of just 1 or 2 per day; other applications may be produced at slightly higher rates, but nothing has been demonstrated with large degrees of automation as is seen in the automotive industry.
Cars are mass produced at rates up to and exceeding 1 per minute. Today, carbon fiber in cars totals about 10 % of carbon fiber use – almost exclusively in low-volume applications such as racing cars and high-end sports cars. Over recent years there have been many pioneering efforts to demonstrate use of carbon fiber in cars. But these are still not high volume “mass production” demonstrations. Surely more will come, but who and when, we don’t yet know.
Each application of carbon fiber has its own “value story”. All market segments for carbon fiber have grown and all have significant additional potential for further growth as more and more new applications and programs come into production. As for the capacity to produce carbon fiber, the industry can effectively produce more than 135,000 tons from its aggregate nameplate capacity of 165,000 tons. This is more than enough to satisfy today’s demand. But with additional growth more capacity will be needed, and several producers and new entrants are planning additional new capacity to satisfy increased future demand as it develops. In conclusion:
We have a mixed bag of individual markets, industries and applications driving overall demand for carbon fiber, and in these Covid-19 times some are down, and some are up. Those segments that have contracted have caused the total carbon fiber industry to look relatively flat in 2020 and to have only a modest growth outlook for 2021. Yet the long-term outlook remains favorable. In the near future one can reasonably expect to see a return to robust year-on-year growth in the carbon fiber industry once again.
The underlying long-term megatrends that made carbon fiber attractive before the pandemic remain unchanged. The advantages carbon fiber offers – stiffness, high strength-to-weight performance, corrosion resistance, electrical conductivity, etc. – are still valid today. Carbon fiber and carbon fiber reinforced parts still demonstrate both technical and economic benefits in many applications, and this is and will be reflected in growth.
CarbConsult GmbH, Hofheim/Germany