While North America is oversupplied with sodium bicarbonate for the important animal-feed sector of the market, most other segments of the bicarbonate business are in balance. Worldwide demand for sodium bicarbonate has grown 3-4% annually over the past few years and producers expect little change in this rate for the near future. Increasing demand for the chemical in developing regions as their consumer populations expand is offsetting slower growth for sodium bicarbonate in North America and Europe.

The sodium bicarbonate market is divided into two tiers: the agricultural and industrial sector, where there is little product differentiation, prices are low and competition is fierce; and the rest of the market—such as pharmaceuticals, personal care products, foods, cleansers and detergents—where products are more differentiated, prices and margins are higher and there are fewer players.

Prices have sagged and margins shriveled in the animal-feed sector ever since sodium bicarbonate producers in Colorado began supplying this market a few years ago with sodium bicarbonate derived from locally mined ores. The fall of prices in this less differentiated side of the sodium bicarbonate business "has probably bottomed out," says Joseph A. Sipia, Jr., president and chief operating officer of the specialty products division of Church & Dwight Co. Inc., Princeton, N.J., the largest sodium bicarbonate producer in North America. Prices are unlikely to show a rapid rebound this year, he adds but will probably remain "relatively flat for a while."

Most sodium bicarbonate in the U.S. is made synthetically by the reaction of soda ash (sodium carbonate) with carbon dioxide. In Europe, Solvay, the region's largest sodium bicarbonate producer, manufactures the chemical via the "Solvay" process, a series of reactions involving ordinary salt (sodium chloride), limestone (calcium carbonate) and ammonia. The newest source of bicarbonate—and the one that has caused the oversupply in the feed and agricultural sector—is an ore called nahcolite, a natural form of sodium bicarbonate that is mined in Colorado.

Worldwide capacity of sodium bicarbonate is about 1.9 million short tons per year, according to Roger Shamel, president of Consulting Resources Corp., a Lexington, Mass., market research firm. About 50% of this capacity is in North America, 25% in Western Europe and 25% in the rest of the world, he says. Globally, sodium bicarbonate plants have been operating at an average 85% of capacity, Shamel estimates.

Church & Dwight, with about 60% of the market, is the biggest player on the U.S. sodium bicarbonate scene. It also has the widest range of bicarbonate products, including the familiar Arm & Hammer baking soda brand. FMC Corp., Philadelphia, Pa., is the second biggest participant in the U.S. sodium bicarbonate market. The companies that have started selling sodium bicarbonate derived from nahcolite ores in Colorado are American Soda, L.L.P., Parachute, Colo., and IMC Global, Lake Forest, Ill. A small producer of bicarbonate from more conventional sources is Natrium Products, Cortland, N.Y. In Europe, Brussels-based Solvay possesses about two-thirds of the continent's sodium bicarbonate production capacity, while Japan's Asahi is a major supplier of the chemical to the Asian region.

About 30% of the world's sodium bicarbonate sales end up as digestion-promoting additives to animal feed, estimates Shamel, while another 25% go into the food and beverage industry. Other important sectors of the market, he adds, are pharmaceuticals and personal care products, with 10%; chemical manufacturing, 9%; cleansers and detergents, 8%; and water treatment, 7%. Miscellaneous applications make up the rest of the market.

"Historically, sodium bicarbonate has shown stable, steady growth, year in and year out—generally in the 3-4% range," says Curt Siverling, sales and marketing director for specialty products at FMC. He expects these patterns to continue for at least the next five years.

There are no big differences in growth rates for various components of the bicarbonate business, Sipia observes, adding that most are increasing at the rate of GDP. For consumer-related uses of sodium bicarbonate "it is basically population increases that are driving growth," he says. "The same is largely true for the medical and pharmaceuticals areas," he adds. But growth of sodium bicarbonate in the agricultural arena, Sipia believes, is tied less directly to population increases and more to a greater proportion of farmers adding the chemical to their livestock feed each year.

Among the world's regions, rapidly industrializing countries, particularly in Asia, are seen as promising territory for purveyors of sodium bicarbonate products. "There isn't much bicarbonate toothpaste in China right now," says Shamel. "But it's going to be introduced there, and it will probably experience tremendous growth."

The biggest concern among producers is depressed tags for the chemical in the agricultural sector. "Pricing is below where it should be on animal nutrition and some industrial segments," says Siverling.

There are some indications, however, that the overabundance of bicarbonate for animal nutrition that has contributed to anemic prices for this application may not last. One reason is that owners of the nahcolite-based bicarbonate operations in Colorado are seeking to get out of the business. In March, American Soda's majority owner, the Williams Cos., disclosed plans to sell its interest in the company's sodium bicarbonate activities. Meanwhile, IMC has had its nahcolite-sourced sodium bicarbonate operations in Colorado on the selling block for several years although it is still selling sodium bicarbonate from its Colorado operations.