CITIC Securities: The carbon fiber industry is currently in the recovery phase at the bottom of the cycle, with demand showing structural improvement

According to the Zhitong Finance APP, CITIC Securities has released a research report stating that the carbon fiber industry is currently in a cyclical bottom recovery phase. After a deep price adjustment and capacity clearance in the earlier stage, the supply-demand pattern of the industry is gradually recovering, and prices are showing signs of stabilizing at the bottom. With the "anti-involution" policy promoting supply contraction and increased concentration in the industry, the industry's prosperity is expected to continue improving. It is recommended to focus on three major directions: 1) Concentrate on high-end applications such as aerospace, drones/eVTOL, and companies with mass production capabilities of high-performance carbon fibers above T700 grade; 2) Advantageous companies in the new energy industry chain: deeply bound to quality customers in wind power, hydrogen energy, etc., with cost advantages and scale effects; 3) Suppliers with clear overseas logic: companies with outstanding export performance and actively expanding into international markets. The main viewpoints of CITIC Securities are as follows: In 2024, China's carbon fiber will exhibit three characteristics: a slowdown in capacity growth, significant regional differentiation, and product structure upgrading. According to Baichuan Yingfu, in 2024, China's new carbon fiber capacity will be 15,300 tons, with a total capacity reaching 135,500 tons, a year-on-year increase of 12.73% (the growth rate exceeded 50% in 2023). The new capacity expansion is becoming more rational, with new capacity concentrated in T300/T700 grade 12K/24K products. Among them, East China (37.53%), Northeast (30.89%), and Northwest (24.35%) are the three main production areas. East China has diverse products but low capacity utilization, Northeast has high concentration (with Jilin as the core), and Northwest benefits from energy advantages. The total carbon fiber output for the whole year of 2024 is expected to be 59,000 tons (a year-on-year increase of 8.16%), with T300 grade accounting for 63.58% (declining trend) and T700+ grade accounting for 36.42% (increasing), with companies generally operating at low loads. In 2025, the overall carbon fiber market in China is expected to show a trend of price stabilization and recovery in some areas. According to Baichuan Yingfu, by August 2025, the market prices in East China for mainstream carbon fiber models T300-12K, T300-24/25K, T300-48/50K, and T700-12K are expected to be 85 yuan/kg, 75 yuan/kg, 70 yuan/kg, and 105 yuan/kg, respectively, with a year-to-date decline of 0%. Domestic carbon fiber prices have remained relatively stable since the beginning of 2025, providing a stable external environment for improving the profitability of the industry chain. By August 2025, the industry operating rate has recovered to 61.52% (a year-on-year increase of 14.92 percentage points), up 10.02 percentage points from the beginning of the year, indicating signs of partial recovery. Outlook for H2 2025: "Structural differentiation" and "moderate recovery" in carbon fiber prices, with the industry as a whole expected to gradually warm up from the downturn. Raw material costs: The bank expects the market price of acrylonitrile to remain low and fluctuate in the second half of the year, reducing cost pressure on carbon fiber companies; Supply and demand: According to Zhongyan Network, domestic carbon fiber capacity is expected to reach 144,000 tons by 2025, with strong performance in the wind power sector in the second half of the year, and demand in aerospace, sports leisure, and other fields recovering, while emerging fields such as low-altitude flight and drones further increase their share. Although the overall supply surplus situation in the industry has not changed, the industry as a whole is gradually shifting from "quantity increase" to "quality improvement" at a relatively bottom level Price: The bank expects to see a characteristic of "structural differentiation" and "moderate recovery" coexisting, anticipating that industrial-grade T300 will operate under pressure with low-level fluctuations; the price range for high-performance T700/T800 is expected to remain stable with a slight increase; it is expected that special categories (such as wet 3K) will see strong price performance driven by demand. Risk Factors: Industry capacity expansion exceeds expectations; significant fluctuations in raw material acrylonitrile prices; intensified industry competition; policy support is weaker than expected; the progress of emerging demand realization is slower than expected; downstream demand is weaker than expected