important alkali field, the shortage, estimated at 15%, is attributed largely to inadequate expansion owing to priorities and unforeseen demands. First, the glass container industry has continued to operate at the wartime rate, while it was anticipated that volume would be lost to tin cans, a development which has not yet materialized. Again, the rayon industry, including high tenacity yarn, has continued to require large amounts of caustic. Also the shortage of soap has brought about a heavy demand for alkaline cleaners. Finally, the unexpectedly heavy demand for aluminum sheet, possibly induced by strikes in the steel industry, has added to the burden of alkali required for the refining of bauxite. To help the situation, some of the electrolytic caustic plants in U. S. arsenals are being started up to relieve the alkali shortage. Also, extensive expansion plans in the soda ash field are being pushed to completion. Still, it is expected to be many months before the present shortage will be overcome. Eventually, however, the increasing demand for chlorine derivatives should tend to bring the caustic situation into balance through the construction of new electrolytic capacity. Another field in which there has been a shortage, particularly in the Middle West, is sulfuric acid. In this instance, the cause was a protracted strike in producing plants in the St. Louis area. Recently, these strikes were settled and it is now anticipated that the situation will improve. Furthermore, the shortage of coal resulting from the strike in that industry should result in an easing in the sulfuric acid situation, because of lessening requirements in industry indirectly re-
stricted by the limited supplies of coal. Incidentally, from that viewpoint, the shortage of coal-tar products, especially benzene for making phenol and naphthalene for making phthalic anhydride, may retard progress temporarily in the protective coatings and plastics industries. This is unfortunate, as these industries are suffering already from heavy demands which they cannot meet. While some shortages of chemicals are temporary, the heavy requirements of such consuming industries as textiles, paper, glass, plastics, protective coatings, and the like are expected to continue, and consequently new capacity is needed to satisfy these expanding markets. 4. The important trend towards the Gulf Coast constitutes a serious internal problem of competition within the chemical industry. However, the chemical industry as a whole benefits from the contribution of this development in the national economy and to foreign trade. For, from the broader viewpoint, cheaper chemicals mean cheaper plastics, textile fibers, and so forth, and this gives an advantage in interindustry competition to the chemical industry, thus laying the foundation for further expansion and for a rate of growth in that field ahead of the over-all rate of growth of the country as a whole. 5. Finally, it is estimated that twice as much research is being done today in this country as before the war. In the recently published 1946 edition of the National Research Council tabulation of research laboratories, it is estimated that total personnel of research laboratories in 1946 approximated 138,515, as compared with about 70,000 in 1940. Again, the
Introduction of German processes such as the Fischer-Tropsch synthesis may open up new fields. There also is much interest in German organic syntheses based on acetylene and in the mercury cell for the direct production of high strength caustic. One result of these intensive research and development programs will be that chemical products as well as plants will become obsolete. But, although the result may be that individual companies will drop by the wayside, the industry as a whole will continue to grow because the new and cheaper or better products will permit a further expansion of markets for the products of the industry as a whole. The exploitation of entirely new products such as fluoro compounds; silicones, herbicides, insecticides, and antibiotics, opens up additional fields. Furthermore, experience has shown that the development of other industries, such as the automobile, the airplane, or even atomic fission, results in new requirements for chemicals. For example, new requirements for phenolic plastics in radios or refrigerators mean new requirements for sulfuric acid and alkalies needed to make phenol. So, whatever the direction in which research may lead, one result will be an increased demand for chemicals, and this means that the rate of growth of industrial production as a whole should be exceeded by that of the chemical industry. Conclusion In view of these considerations, it is concluded that the impressive expansion of plant which has occurred and is occurring in the chemical field is not out of line. As the economy of the United States grows, there should be even greater corresponding growth in the chemical industry.
Chemical Exports on Upswing C. C.
WORLD-WTDE
CONCANNON,
demand
for
Chief, Chemical and Drug Division, U . S. Department of Commerce
American
chemicals and ability of manufacturers and exporters to fill only partially this huge call characterized the foreign chemical trade in 1946. Nevertheless, exports from the United States of chemicals and allied products exceeded $500,000,000 during the year just passed, surpassing all previous expectations. Conditions are still far from normal in practically all world markets, yet there are some indications toward return to prewar market status. World chemical trade remains above prewar levels and is likely so to continue. Consumption of chemicals is 80
bound to be greater but distribution may be changed. Those countries which have expanded their chemical industries seem disposed to maintain an appreciable portion of them when peacetime arrives, and all wish to share in the broadened export trade. However, it is believed that in 1947 the United States will continue to be the major world chemical exporter especially if goods are plentiful once more. Generally speaking, countries in the British Empire are exporting chemicals and allied products to other consuming areas at levels considerably above prewar. In Europe, reconstruction has progressed and CHEMICAL
chemical production at the end of 1946 was much higher than at the beginning of the year, especially in those regions where factories had operated while under German or Russian control during the greater part of hostilities. France has gone a long way toward resumption of its chemical trade. Belgium, Czechoslovakia, Denmark, Finland, Hungary, Italy, Netherlands, Norway, and Poland are all exporting chemicals to a more or less limited extent, largely to one another. With resumption of manufacturing industries, requirements for chemicals from abroad increased, and durAND ENGINEERING
NEWS
ing the first half of 194(5 United States exports to Europe approximating $85,800,000 accounted for 30% of total shipments. Another indication of Europe's progress toward reconstruction is resumption of its trade to t h e United States. Chemicals and allied products are again entering this country from Europe. Reports also indicate that chemical imports into South America from Europe are gradually increasing, although so far the items imported from there are, generally, those for which the supplying country has been a leading world source, such as citric acid and tartaric acid from Italy. Trouble spots, particularly in the Far East, which persisted in 1946, postpone return to normal market conditions in these areas even longer than first expected. Notwithstanding this adverse situation, chemical trade is going o n , especially for essential raw materials and relatively large imports into t h e United States of these are being made. For the most part, the world's chemical trade in 1946 continued t o be under the control of participating countries both for outgoing and incoming shipments, largely because of shortages of commodities or lack of transportation facilities. Trading by commercial agreements w a s accentuated mostly in the form, of short term agreements among European countries, which usually included needed chemicals.
C. C .
Concannon
chemical exports which started in 1945 was reversed. Should the high rate of shipments the last quarter of 1946 approximate the previous nine months, exports of chemicals and allied products will total around $550,000,000 for the year. United
States
Exports
in 1946
Throughout 1946, most countries continued t o look to t h e United States as a source for an appreciable portion of their chemical supplies. This undoubtedly will be true in 1947. Chief competition in foreign'markets in 1947 as in 1946 will probably be from the British Empire. Preliminary, incomplete statistics reveal that the U n i t e d Kingdom, and in fact t h e British Empire as a whole, exported larger amounts o f chemicals and allied products in 1946 t h a n in 1938. I t appears that they will continue to export at the higher level i n 1947. The plan of t h e United Kingdom's chemical industry to export 7 5 % more than before t h e war was realized in 1946. British official statistics show that total exports of "chemicals, drugs, dyes, and colours" which also include medicinals and paint, valued at $200,000,000 during the first nine months of 1946, were more than double that o f the corresponding period in 1938. Europe was the destination for 3 5 % and t h e countries in that area affected most by the war—Denmark, Netherlands, Belgium, a n d France—were t h e outstanding markets. How much of this European trade will be kept when chemical manufacturing facilities there are in operation is problematic- England's largest markets are still Empire countries. I n 1946, based o n incomplete statistics, t h e downward trend in. United States
Medicinals play an important part in this trade, representing one-third of the total shipped to practically all areas. New and old items are sold in almost every country. However, the best markets during the first half of 1946 were Mexico, China, Brazil, Cuba, Philippine Republic, Canada, Colombia, Argentina, France, India, Venezuela, United Kingdom, Union of South Africa, Peru, Chile, Sweden, and Switzerland, in that order, accounting for 7 0 % of total medicinal exports during that period. (Official statistics showing detailed exports by countries for the year 1946 will not be available for some time and statistics given in this article have been compiled in the Chemical and Drug Division from unpublished monthly data'furnished by the Bureau of the Census). Industrial chemicals and chemical specialties are other large items, and represent numerous individual commodities for which there is generally a world shortage, and a large demand. Accounting for another third of the total chemical exports, these too, have world-wide distribution. T h e same countries which were the best markets .for medicinals likewise were leading markets for industrial chemicals and chemical specialties, with the addition of Belgium, Italy, and Australia, and took 8 0 % of t h e total of $90,000,000 worth shipped during the first half of 1946. It will be many months before even a comparatively small portion of the consumption abroad can be filled.
VOLUME
UARY
Competition
2 5, N O .
2 »
»JA
13,
1947
Insecticide materials, agricultural insecticides and fungicides, household insecticides and disinfectants, shipped throughout the world accounted for $10,000,000. This field is believed t o offer opportunities, for increased sales in 1947. Other outstanding commodities were soda ash, $1,400,000; caustic soda, $1,600,000;* bleaching powder, $1,200,000; calcium and textile specialty compounds, $1,800,000; carbide, $1,700,000; sodium bichromate and chromate, $1,200,000. In the coal-tar products group, total of which reached a value of $32,000,000 during the first half of 1946, there is more concentration on fewer items and markets than in the medicinal and industrial chemical segments. Exports of dyes, color lakes, sulfur black, and synthetic indigo reached a value of $17,000,000, of which one quarter was shipped to India, and one eighth each to China and Canada. Brazil, Mexico, Belgium, Argentina, and Turkey were other large consuming markets. The remainder was sold on many markets in relatively small amounts. Most of t h e coal tar and coal-tar pitch was shipped to Europe, primarily France, Switzerland, and Spain, totals for the half-year being $1,000,000 and $3,500,000, respectively. European countries likewise were principal consumers of the $1,500,000 worth of phenol shipped abroad. Exports of pigments and paints amounting to over $26,000,000 in the half-year period are world-wide with numerous countries sharing in t h e business t o a small extent. Leading consumers were Canada, $4,000,000; United Kingdom, $2,900,000; France, $2,300,000; Mexico, $1,900,000; and Brazil, $1,400,000. Sweden, Colombia, Philippine Republic, China, and Union of South Africa each took around $900,000. O r b o n black, of which the United States is the outstanding world producer and exporter, accounts for one third of the shipments of this group. Of the total, 3 0 % went to t h e United Kingdom, 20 to France, and 13 t o Canada. Other large purchasers were Spain, Sweden, Switzerland, Argentina, Brazil, Mexico, India, and Australia. Ready-mixed paints, stains, and enamels to a value of $5,400,000 went t o almost all countries in varying amounts but t h e best markets are in this hemisphere, with Mexico the largest single taker. Over half a million dollars worth likewise was shipped in comparatively small amounts to many countries in Europe. There is a great need for fertilizers and fertilizer materials especially in the waraffected areas. With few exceptions, however, the United States has not been an outstanding supplier of plant foods and fertilizer materials t o foreign markets. Exports of this group were valued at only $12,000,000 in t h e 1946 half year. Half of the total was for Europe, France alone taking nearly t w o million dollars worth; the Netherlands and Poland, each one
81
important alkali field, the shortage, estimated at 15%, is attributed largely to inadequate expansion owing to priorities and unforeseen demands. First, the glass container industry has continued to operate at the wartime rate, while it was anticipated that volume would be lost to tin cans, a development which has not yet materialized. Again, the rayon industry, including high tenacity yarn, has continued to require large amounts of caustic. Also the shortage of soap has brought about a heavy demand for alkaline cleaners. Finally, the unexpectedly heavy demand for aluminum sheet, possibly induced by strikes in the steel industry, has added to the burden of alkali required for the refining of bauxite. To help the situation, some of the electrolytic caustic plants in U. S. arsenals are being started up to relieve the alkali shortage. Also, extensive expansion plans in the soda ash field are being pushed to completion. Still, it is expected to be many months before the present shortage will be overcome. Eventually, however, the increasing demand for chlorine derivatives should tend to bring the caustic situation into balance through the construction of new electrolytic capacity. Another field in which there has been a shortage, particularly in the Middle West, is sulfuric acid. In this instance, the cause was a protracted strike in producing plants in the St. Louis area. Recently, these strikes were settled and it is now anticipated that the situation will improve. Furthermore, the shortage of coal resulting from the strike in that industry should result in an easing in the sulfuric acid situation, because of lessening requirements in industry indirectly re-
stricted by the limited supplies of coal. Incidentally, from that viewpoint, the shortage of coal-tar products, especially benzene for making phenol and naphthalene for making phthalic anhydride, may retard progress temporarily in the protective coatings and plastics industries. This is unfortunate, as these industries are suffering already from heavy demands which they cannot meet. While some shortages of chemicals are temporary, the heavy requirements of such consuming industries as textiles, paper, glass, plastics, protective coatings, and the like are expected to continue, and consequently new capacity is needed to satisfy these expanding markets. 4. The important trend towards the Gulf Coast constitutes a serious internal problem of competition within the chemical industry. However, the chemical industry as a whole benefits from the contribution of this development in the national economy and to foreign trade. For, from the broader viewpoint, cheaper chemicals mean cheaper plastics, textile fibers, and so forth, and this gives an advantage in interindustry competition to the chemical industry, thus laying the foundation for further expansion and for a rate of growth in that field ahead of the over-all rate of growth of the country as a whole. 5. Finally, it is estimated that twice as much research is being done today in this country as before the war. In the recently published 1946 edition of the National Research Council tabulation of research laboratories, it is estimated that total personnel of research laboratories in 1946 approximated 138,515, as compared with about 70,000 in 1940. Again, the
Introduction of German processes such as the Fischer-Tropsch synthesis may open up new fields. There also is much interest in German organic syntheses based on acetylene and in the mercury cell for the direct production of high strength caustic. One result of these intensive research and development programs will be that chemical products as well as plants will become obsolete. But, although the result may be that individual companies will drop by the wayside, the industry as a whole will continue to grow because the new and cheaper or better products will permit a further expansion of markets for the products of the industry as a whole. The exploitation of entirely new products such as fluoro compounds; silicones, herbicides, insecticides, and antibiotics, opens up additional fields. Furthermore, experience has shown that the development of other industries, such as the automobile, the airplane, or even atomic fission, results in new requirements for chemicals. For example, new requirements for phenolic plastics in radios or refrigerators mean new requirements for sulfuric acid and alkalies needed to make phenol. So, whatever the direction in which research may lead, one result will be an increased demand for chemicals, and this means that the rate of growth of industrial production as a whole should be exceeded by that of the chemical industry. Conclusion In view of these considerations, it is concluded that the impressive expansion of plant which has occurred and is occurring in the chemical field is not out of line. As the economy of the United States grows, there should be even greater corresponding growth in the chemical industry.
Chemical Exports on Upswing C. C.
WORLD-WTDE
CONCANNON,
demand
for
Chief, Chemical and Drug Division, U . S. Department of Commerce
American
chemicals and ability of manufacturers and exporters to fill only partially this huge call characterized the foreign chemical trade in 1946. Nevertheless, exports from the United States of chemicals and allied products exceeded $500,000,000 during the year just passed, surpassing all previous expectations. Conditions are still far from normal in practically all world markets, yet there are some indications toward return to prewar market status. World chemical trade remains above prewar levels and is likely so to continue. Consumption of chemicals is 80
bound to be greater but distribution may be changed. Those countries which have expanded their chemical industries seem disposed to maintain an appreciable portion of them when peacetime arrives, and all wish to share in the broadened export trade. However, it is believed that in 1947 the United States will continue to be the major world chemical exporter especially if goods are plentiful once more. Generally speaking, countries in the British Empire are exporting chemicals and allied products to other consuming areas at levels considerably above prewar. In Europe, reconstruction has progressed and CHEMICAL
chemical production at the end of 1946 was much higher than at the beginning of the year, especially in those regions where factories had operated while under German or Russian control during the greater part of hostilities. France has gone a long way toward resumption of its chemical trade. Belgium, Czechoslovakia, Denmark, Finland, Hungary, Italy, Netherlands, Norway, and Poland are all exporting chemicals to a more or less limited extent, largely to one another. With resumption of manufacturing industries, requirements for chemicals from abroad increased, and durAND ENGINEERING
NEWS
