Let's change the industry image !!
The tyre pyrolysis and recovered carbon black industry always seems to be just before its commercial break-through. It has been like this for some 30 years. Many people have invested a lot of passion, but could not yet realise their dream of a renewables business. Others quickly rose their ventures in order to snag government or EU support, only to disappear 2-3 years later. With the money.
Among the many challenges for the industry (e.g. technical, marketing etc.), its poor image is one of the fundamental hurdles for going to market. Any raw material supplier industry either
looking suspicious
looking short-lived or
having distributed gazillions of samples of more than questionable quality & value
will have difficulties in building credibility in the market. Plus, because there still is a lack of game changing approaches to recovered carbon black, this recycling product has a somewhat "dirty" recycling tag attached. Some companies try to get away from the pejorative connotation of "pyrolysis" by branding their process as "Thermolysis", "Vapo-Thermolysis", "Depolysis" etc.
The poor image and the lack of transparency on any technological advances have lead major event organisers like UKIP (TireTechnology 2016) to decide against including tyre recycling presentation sessions in their next event. I can understand their point, but it saddens me also, because it is a missed opportunity for advancing the pyrolysis industry.
What is needed now from pyrolysis companies is a real joint effort in correcting this poor industry image. For a moment, forget about all your keen plans of selling your technology licenses by the dozen every year. Forget about your research to be the first to market with a truly value adding recovered carbon black product. Forget about your sales plan to be the first to make it into a commercial passenger car tyre (this might take you north of 4 years anyway). The first hurdle is to be taken together. After that, you can displace other competitors. Competition is healthy. It motivates, it inspires, it weeds out. And for the time being, there is still a lot of space for the pyrolysis industry. So, collaborate! Create a joint quality label (like the one on fine wines)! Increase the industry visibility in the market! Showcase success stories!
Let's go for value !!
Some of the other issues arise if pyrolysis ventures don't have a solid marketing and sales strategy. Then, their business becomes production driven and that rarely is a good business model. On it's journey from just eliminating waste over recovering energy from waste to recreating raw materials from waste, the tyre pyrolysis industry has more and more requirements for marketing. No matter which stage your pyrolysis company is in, marketing can help you get funded, make smart decisions on your plant kit and, of course, sell your products to the market.
Now, the poor product image does not quite help selling at high prices. Neither does the ever decreasing feedstock price for virgin carbon black, which effectively puts a lid on the virgin carbon black price level for most but the highest value creating products (conductive, ultra high surface & structure etc.). The big manufacturers of virgin carbon black are hurting right now. Many of them need to cut cost and have announced major reorganisations. Chinese imports to Europe have practically disappeared. The pyrolysis industry should actually be thankful for this tough market conditions, because they force the industry to adapt and make a choice for adding value. I don't think that a business model for pyrolysis carbon black is viable if it focusses on a product being a cheaper and lower grade substitution for virgin carbon black. A paradigm shift is needed, the pyrolysis industry needs to create products that add value where virgin carbon black does not perform well. I sincerely believe that this is the only working strategy to finally lead the pyrolysis industry to market.
Let's see where the industry is
I am amazed by the fact that I discover and speak to new recoverd carbon black ventures every week. My database now comprises some 60 companies worldwide. To my knowledge, only 2 of them are branded and commercially established in the market. Only one of them is sold out (Reklaim, USA). Most of the ventures are still in the funding stage. Many have not yet picked a technology. On the other side, I see technology providers claiming sales of 10+ technology licenses or even plants. But I don't see these plants in the market yet. Many smaller companies actually might have a plant and some customers, but they have difficulties reaching international and bigger customers.
There is a vicious circle for pyrolysis ventures without a plant. In order to secure contracts, you need production samples or at least preliminary pilot samples. It takes either a leap of faith or a good marketing strategy to bridge this hurdle. Some ventures are interested in buying-in solid volumes of competitive product in order to fill sales until they go to market. On the other side, there are ventures with an existing plant kit requiring intermediate funding. What a good opportunity for collaboration within the industry! I can connect you if you are interested.
The technological approaches to tyre pyrolysis are very different. It might be a batch pyrolysis, for example like Carbon Clean Tech ("CCT"). CCT were acquired by Pyrolyx and, to my information, today still are the only branded and commercialised supplier of recovered carbon black in Europe. The vast majority of pyrolysis companies have chosen a continuous pyrolysis process. Here, the differences could be in whether the kiln operates in a rotary fashion or static, by gravity (e.g. Pyrum). There are different approaches for the pyrolysis inert gas, typically nitrogen. Some say the inert gas is not even needed when feeding with relatively wet tyre material, in which case water vapour becomes part of the inert gas. Others use vapour as inert gas by design (e.g. Alpha Carbone). Most companies use bought-in granulated passenger tyres as feedstock. The tyre shredding and granulating industry is quite mature so that it will be difficult to justify vertical integration just by cost. All these different approaches enable their companies to have very unique value propositions, when played out well in a marketing lead approach (Contact me if you'd like to explore!). For continuous operations, the typical kiln size used to be 15,000 tpa tyre input and about 5,000 tpa output of recovered carbon black. This size has now evolved to be about double. Because of economies of scale, many ventures now rather plan for a 10,000 tpa output.
By now, every player in the pyrolysis industry has realised that the unconditioned soot / char coming out of the pyrolysis kiln is not yet fit for sales. It needs to be "upgraded", at least by milling and pelletising/granulating in order to match quality standards set by virgin carbon black. Some producers of recovered carbon black have found outlets for their soot, but these unfortunately will be small volume and low value. I see an amazing innovation potential in the area of upgrading recovered carbon black, which might go well beyond milling and pelletising. This innovation potential can help ensure quality, but also can provide more unique value propositions for differentiated products.
Let's take the first step . . . together
If you are in the pyrolysis industry and interested in advancing your business through smart marketing, let's talk! Let me help you grow your business. Ask me for a free Skype session. My Skype ID ismartin.von.wolfersdorff
And if you are in a different industry and want to grow your sales aggressively in a complex B2B environment, let's also talk! Optimising sales with a structured sales process approach is my other consulting specialty.
Last, but not least, if you like this post, please share it with your network!
Have a great day all, and talk you soon!
Martin von Wolfersdorff is principal consultant at WOLFERSDORFF CONSULTING. He helps chemical, materials and other B2B companies optimise sales & strategy and connects OEM companies with innovation providers. Martin also has expert knowledge in titanium dioxide, custom colour masterbatch, carbon black and tyre recycling materials like recycled carbon black and devulcanised polymers. He has held various roles from R&D engineer to commercial director EMEA at ICI, Huntsman Pigments, Americhem Europe Ltd and Cabot Switzerland GmbH.
For more frequent updates, follow him on LinkedIn.
Further LinkedIn Pulse articles:
"Stabiles Wachstum mit Vertriebsprozess & LinkedIn"
http://bit.ly/Vertriebsprozess
"Optimising the chemical distribution channel"
http://bit.ly/optimise-distribution
Prospects for recovered Carbon Black 2023
Wolfersdorff Consulting Berlin
