US ' vV< e K^^^T , *"S"" 1s ' "•w*"*{*'-
IS OVERPRODUCTION PLAGUING US?
all! g|CAl^DMNEERIM
news \/ΛΙ
OCTOBER 2 2 , Ϊ9&
9^ - ΜΛ
As the Late A\ Smith Said, "Let's Look at the
14
; APPLIED JOURNALS, ACS Director of Publications:
C, B. Larrabee
Editorial Director: ^/Executive, Edifor;
W. J . Murphy t James M . Crowni*
m?
Joseph H . Kuney ' .h;> y '
&*s ^Production Manager:
J^f *,' Manag/ng Editor;
Robert F. Gould. ; * :;; " ,'* *V^ ,
:|"irEDITOR!ALTWEAD^QUARTCRS ^ '* A V : > £ : j f / ^ ^ * &? W A S H I N G T O N 6 ^ D . ~C.s>-> \ £ ^ ' ' : f - t: * * ψί& 1155 Sixteenth St.;· N.W.h, * '" \r - V. V. * v,t £ v , - Phone Republic 7-5300 Teletype WA 23 (; « ^ K > / ^Assdciète Editors:'j ' * £\y -V^*» f- ί *~*~'\Λ·*^ * J ! n \ > j „ D a W d M. Klefer, George Β. K r a h t z /* ^ ^ ' / , \ i ï i X * ^ AssistanKEditorst\4S ?" ; J ". N-v~ . f * \ , *;,% r Kathryn Campbell, Helen H . \ Blunt, , ^-l::li Irene 6 / K l e f e r . Betty V. Kieffer, WhiJden -, ' W . Johnson, M o r t o n Sal kind, -David E. Λ ^ -*Γ *%>^G^shee, ArtKur^Poulos;. * s / . « ? vT* *4.,- ; 4 u " , EdifjMiaÇJ&ustanfï^ £ * ^ V J7"'" ^
T e l e t y p e C G T25 *^\*£Assocfafe^Ixfι for: Albert S. Hester^A ^î " * - - ' J fi«#?Asstsfanf EditorrV Chester Placok w
i*«. '
$ f ^4H O U S T O N ^ 2 a ^ T E X . ^ ; ; ί1« >1918 Melrose Bldg.'^ " V f i i t l P h o n e Fairfax 3-7107 ^ Teletype HO 72 Ïl0^^fAssociate ]βήΙ$6τζχ-Harry " ~ - w r H a i n e s / j f . *;^' jj&t^&*'Assistant Editor:; Bruce F. Greek * ^ ' / >-^'ι j î C i 'fN E W Î Y O R K 16/ N I Y . " ' " *;2 Park Ave. '*··--·-•" 3 |Γ;^£ί ^*!°"ΐ«· ί 5? Γββ °; η ^ΐ§46^ ;;^^Teletype* VVÀ 223 ^ i | f j f A i i o c î â f e Editors?'γ*\; FedorT^v^xi \
^^^W^Mëi
C A L ! FS " T N ' Î Ï ^ Î ^ S V ^ ^ Ϋ ν
: 7 ^ S > ' 7 0 3 ' " W e c h a i l I c » , i : i n s t i t u t e Bldg. k%vpf "t^4*»:. a
a
iW>tr>hone;Exbr«l> k2i2B^' ,| #;Î^Télety pè:SF- 549f ^ " ^ V " ^ G a r d o n H? Β Ι « Ι Μ ^ Γ ' - " ^ ' " "
£
"
w
-^
w
5^^^Hazeî»BUho>rRi;K^BoundyrA^C?£Byrns;%vî r ,w ô??^J?^T.tCex^3r./Maurlce;Fr.Cre8S^K^R.'L^ , 'V»ïS • fefe&lcseon,^ Hr-:b;Flsher,%Theodore:S.^Hod.TSt % ^^^qlhsr^.Kinsmanl^Î^|
biliiy £or the statements and ublicarîoas^ "Vicwe expressed inlthlTedi^ç-f*.. «^C %'torial* are those of die editors and do not necessarily r e p r e - f i * ^ j ! ^ : * sent t h e official position of die American Chemical Society.. ' \ -. t j iâK'
•s4Î^^TniΧ*
Record"
j f l F E W DAYS ago w e received a telephone call from a friend i n N e w York who has a vital stake in the continued prosperity of the American chemical industry. To put i t mildly, h e was considerably disturbed. Riding in with a commuter friend h e h a d heard in a rather vague and second-hand fashion that certain economists had announced to a selected list of clients that the chemical industry w a s likely to he in an over-produced position for the next 10 years. Would I confirm or deny such an opinion? Such a sweeping statement, without our knowing all the surrounding details, as not easy for us t o answer with a categorical n o . Thousands of commercial chemicals are produced, some at the moment may he overproduced, others are probably in relatively short supply. W e think t h e question posed by our friend from New York can best be answered by looking at t h e past history of the industry. With s o m e notable years of exception, the chemical industry could, w e think, b e most aptly described as being underproduced rather than overproduced. W e believe this statement could b e substantiated in any study of the more than 3 0 0 years of t h e industry in America. It i s true also of the more than 3 0 years that w e have been personally associated with it. Many so-called classic examples could b e cited where t n e pessimists w e r e completely wrong. Two stand out in our memory. Others could, with a little reflection, b e mentioned. At the close of World War I, phenol and caustic figuratively w e r e running out o£ our ears. W e would not recommend either o n e for earaches or headaches, but those w h o were trying to move these products a t the time, w e are certain, had m u c h use for aspirin. W h a t happened in a short period is characteristic of much of the history of the chemical industry. Phenol-formaldehyde plastics caught on in a big w a y and rayon created the n e e d for still more caustic plants capable of turning out a higher grade of product. Chlorine, which could hardly b e given away, was upgraded through research for n e w products, and an increase in population and in industrial activity stimulated the building of vast numbers o f water-treatment and waste-disposal plants. Anyone in the early twenties suggesting the eventual establishment of a huge alkali industry along the Gulf Coast area would have been laughed at. H o w right he would be in 1956! Perhaps temporarily w e have more nitrogen fixation faculties than the immediate demand would appear to justify. However, we d o n o t think companies in this field have made their decisions blindly and without exercising good judgment. T h e men w h o direct the chemical industry today must and do Have real confidence in research for new products and in nev> u.ses for old ones. T h e y also have confidence in the ability of market research and commercial development personnel. A perfect example of the sort of thing w e mean is illustrated by the article in C&EN (Oct. 8, page 4 9 3 6 ) reporting on the aggressive approaches being taken t o build new markets for our h u g e ammonia capacity. Here is an excellent example of imaginative thinking with research and market research working together to solve a problem and to give a constructive answer to management. T h e vast expenditures for n e w plant and equipment by the chemical industry during a n d after World War II, the expansion undertaken during the Korean war, and t h e continued spending of large amounts i n recent years, have not b e e n based on any hit-or-miss conceptions about w h a t will be n e e d e d by the chemical and chemical-consuming industries in the next decade or two. N o r is there indication of any appreciable diminishing in capital expenditures in t h e next two years. Indeed, these figures may set new records. Economists may differ at the moment as to whether t h e final quarter of 1956 will be the best in all history or will witness considerable weakness in our economic well-being. Plant expansion cannot b e based o n such snortterm prognostications. W e have every confidence in the planners of American chemical industry. In every well managed company, they constitute quite a team of individuals with highly specialized talents who k n o w how to coordinate their efforts properly. If w e look a t the record, their batting averages are very high.
f*"fï
w*etw.
