The Chemical world This week
PETROCHEMICAL FEEDSTOCK COSTS IN TURMOIL Producers of petrochemicals are asking the now question—how much will costs increase for feed stocks for making petrochemicals? There is no doubt they will increase. The answer to how much depends on many aspects of ecology, on poli tics in oil and gas exporting coun tries, and on steps taken by govern ments of countries which make petrochemicals. If the increase should become too much for U.S. producers of petro chemicals to remain competitive worldwide, the U.S. industry could shrink to a shadow of its present relative size. The decline may even now be under way. The need to do something about all this and to improve the future position of the U.S. petrochemical markets was one of the main themes during two days of packed sessions at the Dallas, Tex., meeting of the American Institute of Chemi cal Engineers last week. In a major keynote address at the meeting, Werner C. Brown, pres ident of Hercules, predicted that within five years the domestic pet rochemical industry could repre sent just a fourth of the world total if current trends and existing na tional energy policies continue. Currently the U.S. petrochemical industry accounts for almost half of the world total. In 1976, Mr. Brown says, the U.S. could have a 2 to 1 deficit in the balance of trade in petrochemicals instead of the 2 to 1 positive balance of today. He also points out that in the 12 months ending June 1971, 449 new petrochemical plants and expan sions were initiated worldwide. But only 45 were in the U.S. Mr. Brown calls for specific changes in U.S. energy policy to allow the American petrochemical industry to remain competitive worldwide. The minimum changes would be to allow access to feed stocks on a free international basis for those petrochemical producers who can use them, and increased allocation for producers tied to natural gas liquids. The allocation 6
C&EN FEB. 28, 1972
increase must be large to offset feedstock cost disparities with over seas producers. Domestic produc ers should have the same free com petitive choice of the lowest-priced feedstocks available, foreign or do mestic, that overseas competitors have, he says. In light of growing worldwide competition, three basic options are open to producers of aromatics and aromatics derivatives, according to H. K. Nieuwenhuis of Chemical Projects Associates, Inc. If no trade restrictions are added, im ports of benzene, toluene, xylenes, and cumene, now quota- and duty free, will increase. The result S would be to reassure producers of basic chemicals who need these Ν I c3 raw materials, and to permit pro r duction of intermediates and end F products at a lower cost than under virtually any other course. ρ A second option would be to per Brown: changes in energy policy needed mit quota-free importation of naph tha for chemical conversion. the value of olefin products, par Whether this option would provide ticularly ethylene, goes higher. aromatics as inexpensively as the What is needed to make new olefin first option is not yet known. The units attractive—or a 20% return on option would firm world naphtha investment level—is a price for prices, especially if U.S. gas utilities ethylene between 4 and 4.5 cents a also bid for naphtha, and offset pound in contrast with current sell some of the much talked about cost ing prices of about 3 cents a pound. advantages of European and Jap With feedstock costs for making anese petrochemical industries. olefins now nearly at the limit A third option would be to limit which will allow a reasonable re by quota or duty imports of basic turn, the demand for new olefins aromatics and cumene. This option capacity could force a rise in ethyl would almost inevitably mean ene prices to meet future increases higher domestic prices for aromat in feedstock costs, conclude Mr. ics and their derivatives, Mr. Nieu Lambrix and his coauthor C. S. wenhuis believes. If the higher Morris. In the U.S., feedstock prices could be passed on to the prices will also be aggravated by consumer, the domestic industry energy shortages, the ecology crisis, might come out even, but it would and restricted imports. seriously hurt the industry's com Western European olefin produc petitive status in exports. ers face much the same problems Feedstocks will continue to be the that U.S. producers face, according major contributor to production to M. G. A. Chadwick of Imperial Improve costs for olefins, ranging between Chemical Industries. 60 and 75% of total costs for vari ments in production technology in ous types of feedstocks, says J. R. the past two decades have swamped Lambrix of M. W. Kellogg. As a the former relatively low rates of result, at current prices or values inflation. This is no longer the for feedstocks, a 20% return on in case, however, as the pace of devestment cannot be achieved unless I velopment has slackened. 1
in Passing:
in Brief: How much costs will increase for feedstocks to make petrochemi cals, how higher costs would affect producers' competitive position, and what can be done to improve the future position of the U.S. petro chemical industry were among the major topics of discussion at last week's Dallas, Tex., meeting of the American Institute of Chemical En gineers. (See facing page)
Technological forecasting is pick ing up followers in the chemical process industries as companies seek new ways to cope with tech nological change. Despite the cost and effort involved and continuing uncertainties regarding its reliability and usefulness, its techniques are being applied more and more for research management, long-range planning, and diversification studies. Full understanding and backing by top management, as well as adequate communication with those who are to use the results, are keys to successful forecasting. (See page 11)
Final program for the 163rd ACS National Meeting, to be held in Boston, Mass., April 9-14. A special symposium on nutrition and public policy in the U.S. will be featured at the meeting. Following this symposium there will be an open forum on how ACS and its members can participate in the im provement of nutritional status in the developing countries. (See page 21)
Newly characterized compounds from plants inhibit animal tumors. Maytansine is particularly potent against tumor cells but has rela tively low toxicity with normal cells. Maytansine's structure is related to those of the antibiotic rifamycins
and streptovaricins. Datiscoside, a cucurbitacin derivative, settles a question of cucurbitacin structure. (See page 58)
I
I Nothing like a dame
There is nothing like a dame for selling the industrial cleaning ma terials of Omega Chemical Co., Chi cago. That, at least, is the view of sales manager Jane Hinkle, 33, who Elimination of malnutrition in most ramrods a dozen saleswomen, all with degrees in chemistry or related of the world's underdeveloped fields (physics, microbiology). areas is a long way off. Current Omega started five years ago in a methods for combating malnutri trailer, and 1971 sales exceeded $1 tion include new low-cost protein million. The company manufac foods, chemical and microbial pro tures phosphatizers, products for conveyor cleaning systems, rust re duction of pure amino acids, tex movers, paint strippers, and the tured animal food analogs, and re like. Mrs. Hinkle (Rosary College, covery of whey proteins. (See page '57) joined up four years ago as a 60) laboratory chemist and general Girl Friday. She did a lot of technical service work, often on the job, and Noted consultant Robert MacMullin gradually worked into sales. She did well, helped by her chemical is 1972 recipient of the Perkin background—the salesmen who Medal, presented annually by the were later displaced were not tech American Section of the Society of nically trained—and Omega decided Chemical Industry for outstanding there had to be other women who work in applied chemistry. The could sell, too. As a result, the company switched from men to award winner's major contributions women about 15 months ago. have been in the field of plus val Working with women is a little ence chlorine chemistry. (See different. The sales force tends to page 62) cry en masse when chastised in a sales meeting. The usual sales training literature simply doesn't In coming weeks... apply to women, Mrs. Hinkle says, except in real estate. The girls • The who and what of federal sci must learn to crawl around fac ence policy in the U.S.—a threetories discreetly in their miniskirts. part series "I used to carry a pair of jeans," Mrs. Hinkle says, "but 90% of the • Hiring plans in the CPI for 1972 time there's no opportunity to • What should ACS be doing about change. I can crawl on top of a professionalism? tank car now without showing any thing." The girls are trained extensively in what goes on in customers' plants, manufacturing being a Chemical & Engineering News sealed book to most of them when February 28, 1972 they're hired. They must learn not Volume 50, Number 9 to react to business situations in the normal male-female manner. 3 Editorial They've got to be subtle about their 6 The Chemical World This Week knowledge, "because of the male In Brief: In Passing: ego thing" (women, of course, hav Concentrates ing no egos). The work, in short, requires maturity. 8,9 Industry/Government/lntemational 56,57 Science/Education/Technology Omega started to expand outside the Chicago area about six months The Departments ago, and Mrs. Hinkle has been hav 11 Industry/Business ing trouble hiring saleswomen. 21 ACS Meeting Program "Most of the chemists I talk to are 58 Science recluse types," she says. She plans 64 New Products 69 ACS News/People now to try some nonchemists with 78 Newscripts sales experience. Says realist 78 Letters Hinkle: "This is no job for the ι sweet young thing." Cover design: Joe Phillips FEB. 28, 1972 C&EN 7
