Supplies tighten, but prices remain flat
By Staff -- Purchasing, 4/8/1999 2:00:00 AM
PRICES: Stable
Despite an expected tightening of supply in 1999, prices for both industrial and USP grades of sodium bicarbonate have been relatively flat on average across the country and will continue to be so, according to buyers responding to Purchasing's monthly chemical price transaction survey.
In December 1998, domestic producers of sodium bicarbonate--Church & Dwight, FMC Corp., IMC Global, and Natrium Products--boosted tags by 2¢/lb for all grades of sodium bicarbonate except industrial-grade product--which was increased by 1¢/lb.
According to Purchasing's survey data, buyers expect flat prices until a possible increase takes place in the first quarter of next year. Currently, the average contract price for industrial-grade sodium bicarbonate is approximately 17¢/lb, and spot tags are just slightly lower at about 16.8¢/lb. These prices are forecast to hover around 17¢/lb on average for the rest of the year.
Similarly, prices for the USP grade of sodium bicarbonate are also flat at about 18¢/lb.
SUPPLY: Tightening
It's possible that tightening supplies of sodium bicarbonate could begin to force prices up slightly toward the end of the year. Presently, there is approximately 635,000 tons of capacity in the U.S.
Earlier this year, Rhodia sold its sodium bicarbonate production business at its Chicago Heights, Ill., plant, removing about 70,000 tons/yr of capacity from the marketplace.
As a result, expansions are under way at Church & Dwight, FMC Corp., IMC Global, and Natrium Products. Church & Dwight will boost capacity at its Old Fort, Ohio, and Green River, Wyo., facilities by 40,000 tons/yr respectively. The Old Fort expansion is under way; Green River expansion is scheduled for completion by the end of this year. Also, IMC Global is in the process of debottlenecking its White River, Colo., facility and expects to increase capacity to 110,000 tons/yr by late 1999.
DEMAND: Steady
Producers estimate U.S. demand for sodium bicarbonate to be growing at 4%/yr, although that figure varies dramatically by specific grade and granulation.
Any lessening of demand for sodium bicarbonate in recent years has been offset by modest growth in the food end use, which is its largest application.
MARKETS: Diverse
The domestic market for sodium bicarbonate is dominated by food--end uses in the food industry account for about 32% of demand. The second-highest end use is in agriculture as a rumen buffer in cattle feeds.
Demand for sodium bicarbonate for use in agricultural applications is expected to increase in the next year, though sodium sesquicarbonate and ground trona are alternates that have made inroads in the market and competition is fierce.
Other applications for sodium bicarbonate include cleaning products, the manufacture of other chemicals, personal-care and pharmaceutical items, in water treatment and in making paint blast media.
Producers and annual capacities
Capacity
Producer and plant location (tons/yr)
* Church & Dwight & Co.
Green River, Wyo. 200,000
* Church & Dwight & Co.
Old Fort, Ohio 240,000
* FMC
Green River, Wyo. 70,000
* Natrium Products
Cortland, N.Y. 15,000
* IMC Global
White River, Colo. 110,000
Total 635,000
Prices will inch up this year
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