CHEMICAL & ENGINEERING
NEWS VOLUME
39, NUMBER 43
The Chemical World This W e e k
OCTOBER
23, i96i
Rubber Exports Hit by Overseas Capacity Big market runs out of steam as more synthetic rubber capacity comes on stream overseas The export ball is over for synthetic rubber. Exports are now running 2 1 % behind 1960's level, and the downward trend will continue into 1962 and beyond. As a result, domestic synthetic rubber production is down 11%, while U.S. consumption is 6% below last year. Both consumption and output are likely to end up below 1960's totals this year, although a strong fourth quarter might pull consumption above the previous year. The current problem for the rubber industry is pegged directly to synthetic rubber plants' coming on stream overseas. Last year, capacity was about 510,000 long tons in Free Europe and Asia. (Communist countries have another 770,000 long tons of capacity.) By the end of 1961 an additional 240,000 long tons are scheduled to come on stream, raising European and Asian totals to 750,000 long tons. Further capacity increases are slated for 1963 and later. About 7 5 % to 80% of foreign capacity is for styrene-butadiene rubber; the balance is for neoprene, butyl, stereospecific (polybutadiene and polyisoprene), and miscellaneous rubbers. Other new capacity is expected in South America, where plans now for about 140,000 long tons of synthetic rubber annually are in the works. Initial production should begin later this year, with new facilities coming on stream through 1963. Again, 75 to 80% will be for SBR. In many cases, the new overseas facilities are owned, jointly or completely, by U.S. rubber companies. Loss of export markets does not necessarily mean loss of business, therefore.
A 20,000 long-ton-a-year neoprene plant built and operated by Du Pont in Northern Ireland, for example, went on stream in mid-1960. Firestone began to produce SBR in a 10,000 longton plant near Le Havre, France last month. Also, Goodrich and AKU jointly own a 5000 ton-per-year special-purpose-rubber plant at Arnhem, in the Netherlands. Figures Tell the Story. Declining export markets come as no surprise to rubber producers. They had been expected for many years. But the fact
that the decline has arrived is disturbing. Exports were a modest part of the synthetic rubber business until 1955, when they leaped 200 r / to 93,700 tons. They soared still further, reaching 342,000 tons last year. The sharp increase is due to changing rubber consumption habits overseas; foreign nations essentially were on a natural rubber economy while the U.S. was filling most of its needs from synthetic rubber. In the U.S., about 70% of the rubber consumed was synthetic in 1960. In Great Britain, France, and
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West Germany, synthetic accounted for only about 40%, in Italy about 30%, Japan about 20%, and India somewhere between 10 and 15%. (In the Soviet Union synthetic rubber accounts for about 70% of total needs.) Other nations throughout the world are likely to continue to increase their use of synthetic rubber and depend more and more on local facilities rather than imports. So while needs for U.S. rubber will continue, exports will be declining. This year, total exports should run around 300,000 long tons. SBR should account for 220,000 long tons; neoprene, 40,000 long tons; nitrile, 8000 long tons; butyl, 25,000 long tons; and stereospecific rubbers, 7000 long tons. Next year, total exports should run near 275,000 long tons, with about 70 to 75% SBR. Exports of stereospecific rubbers should be between 10,000 and 15,000 long tons; overseas plants will not produce these rubbers until late 1962 or later. Lower Production. The present export decline is reflected in decreased production in the U.S. According to the Rubber Manufacturers Association, total synthetic rubber output is running 1 1 % behind 1960's level as of August. This is an improvement over the first half, during which production trailed the previous year by 16%. Monthly increases are expected during the balance of 1961, so that production may total about 1.4 million long tons. SBR should account for a little over 1 million long tons and neoprene about 116,000 long tons. Nitrile rubber output should reach 40,000 long tons while butyl rubber amounts to 105,000 long tons. Stereospecific rubber production could reach 50,000 long tons. This year, though, consumption will probably be half that amount as inventory building is in progress. Total domestic synthetic rubber consumption was about 6% behind 1960's pace as of August, but it could come close to last year's 1.1 million long tons before the year is over. Rubber output and consumption closely follow gross national product and industrial production, with automobile output especially significant. Auto production this year should total 5.5 million cars, lower than anticipated. This contributes to a decline in consumption but has not affected the replacement tire market in 1961; this year sales of some 71.5 million tires are expected, compared to 68.6 34
C&EN
OCT. 2 3, 1 9 6 1
million last year. And next year replacement tire sales should be near 74 million units. Rising auto output, GNP, and industrial production point to a better year for the rubber industry in 1962 than in 1961. Total synthetic rubber production should be about 1.5 million tons or a little more and consumption almost 1.2 million tons, record production and consumption levels. Incidentally, the export decline does spell some good news for rubber processing chemical producers. Although overseas nations are building up synthetic rubber capacity they still lag in output of peptizers, blowing agents, antioxidants, and other rubber processing chemicals. This is a $100 million business in the U.S. now and should increase 6 to 8% next year, with exports contributing significantly.
Air Products Buys Interest In Houdry Sun Oil has accepted an offer by Air Products and Chemicals to buy the 160,000 shares of Houdry Process Corp. stock Sun owns (C&EN, Oct. 16, page 19). Air Products will purchase 80,000 of the shares for cash, exchange one of its own shares for each of the remaining Houdry shares. And as part of its plan to merge with Houdry, Air Products will offer all other Houdry stockholders a similar one-for-one exchange for their 183,450 Houdry shares. Houdry will operate as an autonomous division of Air Products if the merger goes through. It probably will assume major responsibility for Air Products' chemical division, now mostly a chemical sales operation. Houdry's wholly-owned Catalytic Construction subsidiary would operate as a separate subsidiary of Air Products, but under Houdry. Merger with Houdry would be the third this year for Air Products. Earlier it acquired Southern Oxygen (C&EN, April 24, page 31) and Delta Oxygen (C&EN, Sept. 11, page 2 9 ) . The company also is involved in a joint oxo alcohol venture with Tidewater Oil at Delaware City, Del. Houdiy does research and development on and licensing of processes and catalysts for the petroleum and chemical industries, as well as engineering and construction of chemical and petroleum plants. It also has been expanding into chemical fields.
Frozen Earth Cavern Holds Liquid Methane Liquefied gases at cryogenic temperatures can be stored in a covered hole in the ground. The new storage concept involves freezing the ground, digging a hole, and installing a vaportight aluminum roof over the hole before filling. No insulation or liner is needed for the hole. Conch International Methane, Ltd., and Constock-Pritchard Liquefaction Corp. developed the new storage technique. The companies claim the method is both safe and economical. The fire hazards involved in storing liquid natural gas underground (at about minus 258° F.) are no greater than the fire hazards involved in storing gasoline or other common fuels, they say. Conch and Constock-Pritchard have not disclosed per barrel storage costs of their method but they do say that the cost will be less than aboveground storage of cryogenic liquids in tanks. Industry experts think the cost of using the Conch-Constock method is comparable to the cost of storing propane underground, which runs about $6 per barrel. Digging a Hole. Conch and Constock-Pritchard's underground storage hole was built by inserting a series of pipes in the ground in a circular pattern. A refrigerant, propane, was circulated through the pipes and prefroze the ground, holding it at 27° F. When the frost barrier had formed, a hole 20 feet deep and 20 feet in diameter was dug using hand tools. The hole was covered with an aluminum roof. A vaportight seal was then formed between the frozen ground surface and the roof. After 30 days of storage, the companies say they have had no problems with leaks or ground heaving. Boiled off gas goes out through a pipe in the roof to a flare. The boil-off could be re-liquefied and returned to the cavern, the companies point out. Conch started to study the process, tagged Operation Mudpie, in 1960. Preliminary tests with ethylene were run at Shell Research's Thornton, England, site. The companies then tested the process at Haymark Terminal near Lake Charles, La., using a cavern with a capacity of about 850 barrels. At this terminal, the tanker Methane Pioneer was loaded with liquid natural gas for shipment to England (C&EN, Feb. 16, 1959, page 2 5 ) .
