Chemical Industry GEORGE A. HARRINGTON INDOIL CHEMICAL CO., CHICAGO, ILL
durable goods. Table I1 shows that the East North Central States account for 32.8% of all of the nation’s manufacturing activity (6). Several industries in the area exceed the average contribution of 32.8% for all manufacturing-for example, the concentration of automobile and railroad car manufacturing facilities helps the area to supply more than half (54.4%) of all the nation’s transportation equipment. Other industries in which the East North Central States contribute heavily to the nation’s supply of good6 are: machinery (50.7%)’ fabricated metals (44.4%), rubber products (43.0%)’primary metal manufacture (41.4%)’ electrical machinery (40.9%), and furniture manufacture (37.2 %). These manufacturing industries are important customers for the chemical industry’s products. They also serve in some instances, as agriculture does, to furnish by-product raw materials for the chemical industry. The by-product aromatic chemicals from coal coking necessary for steel manufacture are illustrative. The area becomes even more important in the nation’s economy because of its central location. The area is bounded on the west by the Mississippi River, on the north by the Great Lakes, and on the south by the Ohio River. These boundaries with their tributary rivers and connecting canals offer water transportation for the movement of bulk goods during most of the year. This water transportation, the railroads, and other transportation media make the area an important concentrator of raw materials from the sparsely settled Great Plains area of the nation and an important exporter of finished goods t o the populated areas of the East. The key to the chemical industry in such an environment is that it is very well placed for easy acncess to its raw materials aiid its customers.
T h e East North Central States contribute about 23% of the manufacturing value of the entire nation’s chemical industry. The area is ideally suited for chemical manufacture, because it contains abundant sources of import a n t raw materials-agricultural products, salt, limestone, coke chemicals, and petroleum. The area is also an important consumer of chemicals because of the concentration of other industries-for example, the automobile, rubber, and paper industries which are large consumers of chemicals. The chemical industry in the East North Central States, because of their central location, also utilizes raw materials from neighboring areas and exports finished chemicals to other industrial centers.
I
N 1950, as shown in Table I, East North Central Division
of the Xorth Central Region of the United States had 20.2y0of the nation’s population and 8.2% of the nation’s area ( 7 ) .
Table I. East North Central States (7) Factor Population 1950 Total emiloyed labor force, 1950 Land area, 1000 acres Farm land 1000 acres Farm l a i d / t o t a l land area Cropland, 1000 acres Ciopland/farm land
East North Central United States
East North Central/U. S., 70
30,399,368
150,697,361
20.2
11,872,955 156,714 112,097
66,239,449 1,903,825 1,158,566
21.1 8.2 9.7
0.716 64,237 0.573
0.609 408,506 0,352
15.7
...
...
CHEMICAL INDUSTRY DEFINED
Thr key to the economic description of this area is its balance between agriculture and industry. The key to the description of the chemical industry in it is its central location-near its raw materials; near its consuming markets. The key to the chemical industry’s future is its ability not only to supply the rapidly groning consumer markets in the area but also to export its products to the adjacent geographical regions. As Table I indicates, 71.5% of the land in the EaAt North Central States is farm land and 57% of this farm land is devoted to crops. Both these ratios are higher than the nation’s average. The land is fertile, and the area’s importance as a source of foodstuffs is well recognized. For example, the area possesses 15.7% of the nation’s cropland, yet in 1951 it produced 33.3% of all the oats, 36.6% of all the corn, and 55.4% of all the soybeans harvested in the nation (4). While these crops are primarily grown for human and animal foodstuffs they are also common raw materials from which chemicals are made-for example, furfural derived from oat hull?, starch, oil, and zein from corn, and oil from soybeans. Such an agricultural area represents a growing market for the chemical industry’s products-fertilizers, insecticides, and weed killers. Yet, along with agriculture, the area contains an important part of the nation’s manufacturing facilities for both durable and non-
In order to define the chemical industry it will be convenient to use the government classification as described in the Standnrd
Table 11. Value Added by Manufacture, 1951 (5)
Industry
(Millions of Dollars) East North Central Total U. S.
Total Food and kindred products Textile mill products Apparel and related products Lumber and products Furniture and fixtures Paper and allied products Printing and publishing Chemicals and allied products Petroleum and coal products Rubber products 1,esthe.r
y , and glass try metals cated metals
Miscellaneous
469
33,543 2899 200 554 399 672 1095 1486 1897 668 743 269 1011 4047 3170 5693 2351 5329 713
E a s t lu’orth Central/U. S., %
102,085
32.8
10,579 5,421 4,699 3,523 1,804 4,180 5,288 8,164 2,687 1,729 1,475 3,561 9,769 7,139 11,219 5,763 9,789 2,842
27.4 3.7 11.8 11.3 37.2 26.2 28.1 23.2 24.9 43.0 18.2 28.4 41.4 44.4 50.7 40.9 54.4 25.1
I N D U S T R I A L A N D E N G I N E E R I N G CHEMISTRY
470
Znclushal Classificalion Jfanual ( 2 ) . Subsequent desci iption of the industry’s statistical record v. ill then be easiei I n Table 111 the major headings that are used in the government’s description of “Chemicals and iillied Products” are given, Industrial inorganic chemicals, the first major subdivision, includes sulfuric acid, alkalies and chlorine, and miscellaneous inorganic chemicals such as the inorganic acids, salts, and elements-i.e., brominc and iodine. The second, industrial organic chemicals, is further subdivided into coal tar crudes, dye intermediates, plastic mateiiale, synthetic rubber, synthetic fihers,
0
0
@
5 tolO.OOO
0
1 to 5 , 0 0 0
0
500to1,000
0
100 to 500
Figure 1. Centers of Chemical Industry of East North Central States S y m b o L indicate n u m b e r of people employed
explosive$, and miscellaneous organic chemicals ,miah as ethyl alcohol, ethylene glycol, carbon tetrachloride. The drugs and medicine group includes biological products, botanical product?, medicinal chemicals, and pharmaceutical preparations. The soap and glycerol group also contains cleaning and polishing preparations, and sulfonated oils. The paint and varnish group includes not only the paints and varnishes but the inorganic color pigments, whiting, putt,y, and wood fillers. The gum and wood cheinicals group includes those products from wood distillation, as well as the naval stores and the tannins. The fertilizer group is self-evident as is the vegetable and animal oil group. The final group, miscellaneous chemicals, is broken down further into perfumes and cosmetics, glue and gelatin, carbon black and bone black, compressed gases, insecticides, salt, and the chemical specidties such as household disinfectants, and boiler treating compounds. The classification “Chemicals and Allied Products” defines an exceedingly coniplex group of products, some of which will hardly be recognized as chemicals. However, the government’s classification is fundamentally a classification of establishments for manu-
Vol. 46, No, 3
facturing aiid riot it classifiixtion of products. The objective in such a system is to include establishment3 that inanufactme products by predominantly chemical processes. The rough st’ructuraof subdivision result? in three divisions: basic cheniicdp, intermediate products for further manufacture, and h a 1 pi’ocluct,. for ultimate consumption-for example, drugs, soaps, and pailits.
Table 111. Definition of Chemical Industry (2) (Major Groups of Standard Industrial Classification G r o u p 2 8 , Clieiiiicals and Allied product,^) Industrial inorganic chemical8 281 Industrial organic chemicals 282 Drugs and medicine 283 Soap and glycerol, cleaning and polishing preparations, ani1 .iilionatcd oils and assistants 284 Paints, varnishes, lacquers, japans, aiid enarliels: inorgaiiic c o h r pipments, whiting, putty, and wood fillers 285 Gum and mood chemicals ”6 Fertilizers 287 Vegetable and animal oils aiid fats 288 llibcellaueous chemicals, indudins industrial cheniic,ai ii;.odiirts aud p i eyarations 280
The centers of this complex chemical industi slio\vn in Figure 1. These are located by the U.8. Departmont of Commerce studies on payroll figures lor the industry iw 1950 ( 8 ) . As would be expected the industry is concentrated in the metropolitan areas-Chicago, Cleveland, Detroit, Aliron, Cincinnati, Columbus, and Indianapolis. The extent of the chemical industry in the East North Centr:il States is shown in Table IV (6). The Bureau of Census figures €or “Value Added by Manufacture” is a relative guide a t least of the chemical industry in this area. Study of Table IV s h o w that the area accounted for 25.2% of the nation’s chemiral industry. This figure in Table IV is different from the 23.2% given in Table 11. Table I1 relates to the year 1951 whereas Table ITI’ relates t o 1947. The 1947 figures are, unfortunately, the latest available for indust,ry breakdown statistics. 11, is true however, that the chemical industry in the East North Ceiiiral States, though expanding in “value added by manufacture” from $1356 million in 1947 to 81897 million in 1951, did drop slightly in relative importance. I n all probability the extraordinary expansion in chemical activity in the Southwest and Pacific Coast areas is responsible for this percentage derreaFe which is indicated for the East North Central States.
Table IV.
Chemical Industry in East North Central States (6) Value Added by 11anufartuie (Villions of Dollais) East
Central Sorth United States Centralj‘U. East S O ! Stll, Industry 25.2 Chemicals and allied products I ,336,796 5,365,201 131,226 454,6YQ 28.8 Inorganic chemicals Alkalies and chlorine 47,518 113,868 41.7 83,708 340,881 24.0 Inorganic chemicals 208,484 1 ,551,381 1 s .1 Organic chemicals 279,741 148,570 37.4 Drugs and medicines Pharmaceutical preparations 246,037 609,104 40.5 Soap and related products 219,764 606,079 36.2 Paints and related products 193,984 573,237 33.8 Gums and Tvood chemicals 62,965 ii;i38 126,856 id.2 Fertilizers 28.2 121,503 482,476 Vegetable and animal oils Soybean oil 72,709 105,291 69.3 Grease and tallow, 33,575 118,830 28.2 Aliscellanoous chemicals 109,813 699,193 24.2
CHEMICAL INDUSTRIES Table 1V shows that the chemical industrj in this area has contributed more than its average share in the manufacture oE alkalies and chlorine, soap, paint, and medicines; it has hcen noticeably below average in the production of industrial organir chemicals and fertilizerP.
Much 1954
-
c
j.
!
-
c
.
I N D U S T R I A L A N D ENG INEVRING CHEMISTRY
Chl.xine and caustic manufactnre accounted for 41.7% of the mtion’stotal in 1947. The industry is centered in the Detroit and Cleveland m a n and is baaed on the availability df extenaive d t dsposits in the area. While the East North Central States are net g e n e d y recogniEed an a mineral-rich area, the salt deposits are, nevetthelem, among the largest h o r n . Thee deposita are dish shaped, and brine appears in the center region@of tbe a.Am a wnsequence salt brines are obtained in Upper t is mined near Detroit. The BureW of Michigan, and solid d Minea reported in 1850 that 6,961,872 tons of salt were used or soldfromtheMichigan-Ohioarea(5). Thieis41.9%ofthetotal U. 8. produetion of 16,629,809 tons for the same year. The hurean also reports that 67% of the total ealt output currently goss into the manufmture of chemicals. The earliest utilization of these beds of salt wcurred because of the ease in obtaining, from nearby sawmills, the waste wood slabs which were ueed for fuel. In the 1890’s the salt brines of interior Miahigan were w d for the first production of bromine, and the salt beds amund the Detroit area were used for the first production of soda ash in the Middle West. Before 1910 several firma had lwsted in this area and were producing soda ash, bromine, chlorine, bleaching powder, magnesium salts, and magnesium oxide. Additional opportunities appewd along the border of northern Ohio for the manufacture of soda ash, and the Painesville and Barbitom areas were opened ahout that time. Michigan and northern Ohio have proved to be ideal for the manufactureof heavy inorganic chemiaale, not only because of the necessary salt, but because of the ahundance of good quality limestone, fresh water, 00.4, and the eany aceees to lake transports, tion. In the past 60yesrs, this area has hewme one of the most important centers of chemical industry in these United States. However, the earliest beginnings of the chemical industry in the E& North Central States were actually not baeed upon u ~ e of the salt beda hut upon the uae of agricultural prcducte. As early an 1840 the Cincinnati area, because of its convenient river traaeportation, had become a center of the meat packing industry. In fact, Cincinnati was nicknamed “Porkopois“ in those days. It is logical,therefop, that our enterprisingforefathers an early an 1840 would begin the manufacture of lard oil (for illumination), tallow candles, and soap here. Thin area in atill a major one for the production of map, detergents, and fat and oil chemicals even though the activities have far ontatripped the raw materials of this particular nr8.3. The meat pdchg industry in the chiosgo area came at a later date, approximately in the 1870’8, when it appeared to be more advantagmus to locate the meat packing industry in the West near ita source of raw materials rather than to ship the animals to thelhtforalaughter. Withthemeatpakkbgindustryinthe Chicago area came the earliest w of p a c e h o w by-products. The manufacture of phosphoric mid and phwphata began in the Chicago area because’ofthe availabity of bones 88 raw mated. The manufacture of fertiliaers from packing h o w wastes establinhed the fertilizer industry which in growing rapidly in the area today, even though the pm!&g h o w wastes now are used for more valuahle products. AB &omhy Table N the fertilizei industry in the area did not meet the national average in 1947. In part this wan because the traditional market for fertilizers has alwaya been the aonth&tern part of the United States. It is certain, however, that any future c e m will show a greatly increased pemntage of the fertilizer induntry attributed to the area. T h e rapidly expanding m a r b t for fertilizer nitrogen in this predominantly agricultural region has led the manufecturars of synthetic ammonia and fertiliaer solutionsto invest in new manufacturing facilities in the area. The organic chemicals group of the chemical industry has not been w important an other groups in this m a , an Table N &om. In part tht, is due to the fact that the chemicals in this olaqs are derived from coal.tar crudes, from cellulose (rayon), and from petroleum and natural gsr. As a wnsequence other region?
. .
in the United States, where such raw materials are more easily available, havethemajorshareof the organic chemicala output. The United States T d ComEAS1 mimion k e d ite first “ C e w of Dyes and Synthetic Organic WORT chemicals” in leal. Previous editions did not include the mthetic organic chemicals. In that year 40 firms reported they manufactnred synthetic or&c chemicals in the area. The 1951 census, 30 yem later, showed 121firms reportine. The figures given in Table IV are for the year 1947, the latest year for which such figures have been published. This branch of the chemical industry has received serious attention, and an a consequence the area’s future wntrihutions to the organic chemicals industry should he wnsiderahly more important than in the pant. Drugs and medicinea are a very important part of the chemical industry in the area %me of the largest pharmaceutical houses and veterinsrV d r u ~manufacturers in the wtmtry are located in the area The drug industry started eomparatively early in the Middle Weat, and pill factoriea were in operation 88 early an 1876. Before 1900 pharmaceutical manufacturer8 were located in Indianapolis, Detroit, Kalamaroo, Chicago, and Elkart, and the centem of the industry are still located in these arean. There is apparently do gwgraphical reamn for the pharmaceutical industry locating hers. Rather history rewrdn that the individual companies in the industry have been started by druggi5A or studenta in chemistry who had some innovation in home remedies to oUer the public.
-.
FUTWREIOF~CHEMICALINDUSTRY IN EA8T NORTH CENTluLSTATEs The indnstry’s earlieat beginnings waa h d largely on the availability of basic raw m a t e n u t , limemoe, fuel, and agrieultura) products. AB the country developed westward the chemical industry met the requirements of th8 wosuming indub tries that developed in the area. It in to be expected that this trend d l wntinne. For example, the Bureau of the Cem estimates that the population of the area wiIl a p p w h 34,I 17,oO by 1960. Thh is ementially equivalent to addmg another city the Si.e of Chicago to the areal If these future citiaens are to have a staodard of living equivalent to or greater than their present conditions,the area will indeed have a large wlf-cootained market for chemical products. A partial answer to the thinking of both government and io-
Eut
GX.“P
NOd
cm,.~ 308.0 28.3 44.0 16.4 0.7
6i:a 22.4
E u t North
~ 0 ~ u . acatnl/u.a.% . 2407.4 449.1
309.2 m.9
50.8
rn.6 279.7
a1.a
91.6 149.2 168.4
108.8
464.8
a5.s 23.2
105.6
lS.1 (1.3 14.2 7.0 ia.2
ii:1 24.4 21.0 2a.i 23.0 24.0
472
INDUSTRIAL AND .ENGINEERING CHEMISTRY
dustry regarding expansion in the East Xorth Central States can be obtained by considering the DP.I Certificates of Kecessity for chemical manufacture in the area. Table V summarizes such certificates ( 1 ) . The table has been rearranged to depart from the government cla.vifiration of the industry so as to shoiv better the trend towards new markrts. Table T' shows that about 23% of the expansion of facilities to manufacture resins and plaPtics and about 14% of the expansion of facilities to produce aromatic hydrocarbons a,nd intermediate chemicals, from which many of those resins and plastics must be prepared, is planned for the area. Recalling Table IV such activity will correct the area's iveakness in the manufacture of the industrial organic chemicals. A word of caution is necessary when the DPA4Certificates of Tecesaity are used as a guide to the direction of the chemical industry. Possibly many of the certificates will not be acted upon at all, arid considerable expansion in the chemical industry has taken place rvithout the benefit of such Certificates of Secessity. As a consequence, Table IT' merely indicates the direction of expansion t o government and industry planning groups. I n the future the chemical industry in this area will not only make increased use of the raw inaterials indigenous to the area, but it, rill also use low cost imported raxv materials. The mea is
Yol. 46,No. 3
covered with a network of natural gas, cmitle oii, i ~ n dprotluct pipelines. This means that it is possible t,o manufacture chemicals based on these ran- materials near their consuming mark The petrochemical industry can be expected to incrcasc markedly in the East Yorth Central States in the future. The largr: pet>rochemical installation a t Tuscola, Ill.! is testimony to thip fact. Thus by using the raw materials that the area L L I ~ S possesses R~~ and the raw materials that are imported from neighboring meas, the chemical industry in the East North Central Sthies ivill continue to manufacture products to meet the diverse needs of it. customers. LITERATURE CITED ( I ) Chern. Eng. S e w s , 30, 5043 (1963). ( 2 ) Executive Office of the P r e s i d e n t . Ruicau of t h e I3urlgct, 1945,
( 5 ) E. S. D e p t . C o m m e r c e , "Annual S u r v e y of .\larluiacturcu. 1951 " (6) U. 8.D e p t . C o n i m e r m . "Census of ,\Ianuiactures, 1947." (7) I:. S.Dept. C o m m e r c e , " C o u n t r y and City D a t a Book, 1953." ( 8 ) U. S.Dept. Commerce, " C o u n t r y Business P a t t e r n s , 1950.'' RECEIVED
for review A u g u s t 11. 1033.
.~CChPTi:D
.January 74, 1
P. BURKE JACOBS AND R. T. MILNER NORTHERN REGIONAL RESEARCH LABORATORY, BUREAU OF AGRICULTURAL AND INDUSTRIAL CHEMISTRY, U. S. DEPARTMENT OF AGRICULTURE, PEORIA, ILL.
T h e area of t h e East North Central States is notable agriculturally for production of a diversity of crops, r a t h e r t h a n for large single crops. However, i t is a n outstanding producer of dairy products, soybeans, a n d fruit. Most of t h e nation's straw processing is located in t h e area, 2 n d m u c h of t h e l u m b e r a n d flour-milling industries. T h e old line chemical industries usually do n o t use primary f a r m products, although some related industries are based wholly on f a r m crops a s raw materials. Increasing use is being m a d e of f a r m intermediate materials, on which d a t a are lacking. The paper therefore tends t o consider all applicable industries, i n addition t o those normally considered as chemical. F u t u r e developments through research o n industrial use of f a r m products m a y bring increasing consumption. Production statistics of various crops i n t h e East North Central area a r e shown in relation t o t o t a l U . S.production.
M
OST of the industries usually characterized as chemical do not utilize agricultural products as originated on the farm. Conversely, a group of industries, such as sugar, pulp, vegetable oil, and leather are based on use of farm products exclusilely. Certain branches of chemical industry, however, do use some materiala or by-products resulting from the processing of agricultural materials into foods or other commodities, such as furfural for synthetic fibers. Such use may expand in the future, since some of these industries are of recent development. Basically, the greatest use of primary farm products lies in the industries more nearly concerned 11ith producing the necessities of life, such as the food and textile industries, which ordinarily perhaps are not considered a- belonging to the chemical group
However, past, distinctions bctn-een these severid linrs of induetry- arc losing significance, and it is difficult today to set an arbitrary demarcation between chemical and other lines, since chemkal treatment and control are used to a great extent in all of these fields. There is much overlapping or interlocking of products: recovery or use of by-products, ant3 fluctuation of materials, so that any comprehensive study of agricultural resources must cover a rather broad field o i general industrl- :ind not be limited to chemical, if all the possihiliti cated. Dat,a on the industrial use of farm products f'rrqurntly are 11011existent or, at best,, are inexact or inadequate. Only a liniitrd amount of information is available as to the actual gcographicnl source of the farm materials used by a specific industry or piant. The fact that certain processing plants are iocated in a given aw:i is no assurance that local farm production will LIP utilized. 'To x considerable extent, the availability of a n agricultural raw material is a matter of relative cost a$ delivered a t a given processing point, contrasted against the demand arid competing priw for the same material for other uses. The principal cereal farm crops ordinarily are consumed directly- as food or feed, and under normal conditions only relatively sinall percentages of these are in surplus and available to industry. Cash returns to the farmer which are securablc from food and feed use usually are higher than can be obtained from industrial use, since certain industries cannot afford to pay comparable prices, -4current surplus over a basic food or feed demand in a given area, however, may depress the price on such excess quantities and make iiidust,rial use possible. Some industries, of course, pay market prices for agricultural raw materials, but such industrial use tends to be limited by existing
