MARKETS
Petroleum Wax Output to Drop This Year Packaging losses will account for third straight annual decline; new uses could reverse downward trend in next few years Petroleum wax production in 1963 will decline for the third straight year. Behind this trend lies diminishing wax consumption in packaging, particularly in the lucrative milk carton field where polyethylene is rapidly assuming a commanding position. But enough new uses lie ahead for wax to reverse this downward trend in the next few years. Just how rapidly output will grow and how high it will go depends, to a large extent, on how much marketing effort oil companies put behind the product. In the past, wax has received relatively little research and development attention from the oil companies. Their main business, after all, is making gasoline. Although wax production reached its high of 1.65 billion pounds in 1960, this is still small when compared with gasoline on a barrelsper-day basis. Since 1960, however, production of
petroleum wax (paraffin wax and microcrystalline wax) has slipped. It dropped to 1.62 billion pounds in 1961, to 1.5 billion pounds last year, and should slide to 1.4 billion pounds this year. Cartons. These production declines are almost entirely reflected in the milk carton market. As late as 1961, when polyethylene was first introduced into the milk carton business, milk and juice cartons consumed 450 million pounds of wax. Now polyethylene is flourishing at wax's expense. Milk cartons used 90 million pounds of polyethylene last year and should increase this to 150 million pounds by 1965. Meanwhile, wax consumption should fall to 200 million pounds this year in milk and juice containers. By 1968, probably only 50 million pounds will be used. Only slight growth prospects are in store for wax in other food-board pack-
aging. Some of these, such as frozen food containers, butter and ice cream cartons, and laminated boxes for cereal and bakery goods, will be under pressure to use polyethylene or other coating materials. In flexible packaging, prospects of wax losing ground aren't as great. But neither are the growth prospects. Household wax paper, biggest single item for wax in flexible packaging, will consume 100 million pounds this year and should grow only modestly, to 110 million pounds, by 1968. One observer sums it up this way: "Housewives of long standing will continue to use wax paper out of habit. But who can figure out what the 20-year-old newlywed will do?" She may prefer the newer packaging films or aluminum foil to waxed paper. Wax has been losing ground to polyethylene in bread wrap, too. This market will take about 65 million
Biggest Outlet for Petroleum Wax Is Packaging
Output of Petroleum Waxes May Reach 1.8 Billion Pounds in 1968
1963 Consumption (Millions of Pounds)
MILLIONS OF POUNDS
1800
Packaging, Food Board Milk and juice containers Butter and ice cream cartons Frozen food containers Cups and round containers Corrugated containers Laminated boxes Miscellaneous
1600
Packaging, Flexible Waxed paper, household Waxed paper, specialty Bread wrap
1400
1200.
1000 1954
195&
1958
1960
Source: Bureau of Mines and C&EN estimates. 30
C&EN
M A Y 2 7,
196 3
1962
1964
1966
1968
Total Packaging Nonpackaging Candles 80 Chlorinated paraffin 40 All other 150 Exports ALL USES TOTAL Source:
C&EN estimates
200 35
25 130 30 20 35 475 100 90 65 255 730 270
400 1400
STOCK. Machine at Du Pont coats milk carton stock with polyethylene, which in past two years has been cutting sharply into the milk carton market for wax
pounds of wax this year, but the downward trend may level off now and remain fairly steady at 65 million pounds. The reason is that wax is still used in bread innerwrap and several bakeries are moving toward longer innerwraps. These wax innerwraps give more "body" to the loaf and provide the bakery with desired advertising. How important is packaging to the wax producer? In 1961, before polyethylene made its impact, packaging took about 950 million pounds of the 1.2 billion pounds consumed in the U.S. In addition, 346 million pounds were exported. This year, about 730 million pounds will go into packaging, and about 400 million pounds will be exported, the same as last year. Meanwhile, a host of miscellaneous outlets, ranging from candles, carbon paper, explosives, and chewing gum to leather and cosmetics, will use 270 million pounds of wax. Logic. It's only logical that wax producers, hoping to reverse their falling production curves, would look
to packaging as one solution. The truly waterproof corrugated container is one promising growth area. Such containers are used to ship poultry and fresh vegetables and fruit. Now only a 30 million pound annual market, it could be consuming 300 to 400 million pounds of wax per year by 1968, according to one estimate. Molded wax products, according to one observer, is another possibility that could become "a Pandora's box if somebody will only take the trouble to open it." "Opening it" will require strenuous market development efforts, such as now support plastics and resins marketing. But many oil companies now make plastics and resins and are familiar with the techniques. Wax to be used in molded products would probably be blended with other materials, such as Du Pont's Elvax, an ethylene-vinyl acetate copolymer. Such blends are receiving a lot of attention now and, in fact, some waxcontaining molded products are now on the market commercially. Agriculture is also attracting the attention of wax producers. Wax mulch, similar to polyethylene mulch, may be one possibility. Coating fertilizer with wax to control release of plant nutrients has been talked about, but there are two distinct schools of thought about its practicality. Opponents say it's impractical to add weight to a fertilizer, vvhose marketing radius is already limited by the weight of the product itself. Only nitrogen, not phosphorus or potassium, needs controlled release. Finally, critics scoff at the thought of spreading a bag of fertilizer that is one big mass of melted wax. Proponents of the idea, certainly aware of these problems, are nevertheless optimistic. It's conceivable that wax-coated urea could replace ureaformaldehyde fertilizer, in which the formaldehyde is used to control nitrogen release. Here, it would be a matter of replacing weight with less weight, cost with less cost. Such an outlet could consume 100 million pounds of wax annually by 1968, according to one estimate. Chemicals. Wax may also become more important as a raw material for chemicals. Certainly one of the most talked-about subjects these days is alpha olefins and their potential as a "soft" detergent material. Three companies (Enjay, California Chemical, and Atlantic Refining) either have or plan units to make alpha olefins by
paraffin cracking. However, it's possible to crack a highly paraffinic crude oil rather than wax feedstock itself. Two questions must be answered, however, before wax's potential in alpha olefins becomes clear. Are alpha olefins the answer to detergent biodegradability; and is wax-cracking the best way to make them? Other methods are possible, such as ethylene polymerization, which is what Continental Oil now uses. It's too early to estimate accurately just how much potential these new possible uses hold for wax. However, it's likely that among them wax can find enough business to increase production to 1.8 billion pounds by 1968. Even that much output would fall short of U.S. capacity, which is estimated at 2.5 billion pounds. Two things about wax are evident. First, wax producers are putting more effort into wax research and development (the American Petroleum Institute, for instance, now has a committee on wax). Second, even more effort will be needed if wax is to make market gains.
BRIEFS Du Pont has trimmed the price of Dacron textile filament yarns by an average of 8% to "broaden" their use. New prices are: 40 denier, $2.20 a pound; 70 denier, $1.82; 150 denier, $1.70; and 220 and 440 denier, $1.54. Celanese is expected to meet the new prices.
WEEK'S PRICE CHANGES May 20,1963 Advances CURRENT
Carnauba wax, No. 1, yellow, lb. Ferric chloride, anhydrous, lb. Gum karaya, powd., No. 3, lb. Menthol, Brazilian, lb. Oil of lemon, Italian, lb. Silver bullion, oz. Silver salts, oz. Chloride Cyanide Nitrate Oxide
$0.91 0.087 2
PREVIOUS
$0.85 0.08
0.47 0.45 3.40 3.10 8.75 8.00 1.2820 1.2770 1.001 0.998 1.007* 0.998 0.8488 0.84V2 1.2205 1.216
Declines Diphenolic acid, quantity orders, lb. $ 0.55 $ 0.75 Mercury, 76-lb. flask 184.00 186.00 MAY 27, 1 9 6 3 C & E N
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