Wednesday, March 25, 2020

Chlorine – Uses, Prices, and Production


This blog is the fifth in a series of blogs I plan to write providing use, price, and production data on high-use inorganic and organic chemicals.  Click here to see the first blog in this series and a list of chemicals to be featured.  This blog provides data on chlorine.

Uses.  Uses of chlorine include:

Ø  As a water disinfectant;
Ø  As a surface disinfectant;
Ø  As a raw material in the synthesis of hundreds of compounds; and
Ø  In industrial processes, e.g., as a solvent; in bleaching paper and textiles; in extracting metals from their ores; and others.

The following table provides chlorine percentages in its uses:

use
percentage
in polyvinyl chloride production
28-32%
as industrial solvents
24-26%
In organic compound synthesis
12-15%
In inorganic compound synthesis
12-15%
in water disinfection
5-10%
in the pulp and paper industry
4-6%
others
15% or less


Chlorine’s usefulness as an element derives from its chemical properties of being highly reactive (which accounts for its enabling the synthesis of compounds) and being able to stabilize those compounds, once formed, because of its strength of creating a stable state after it is embedded in the structure.

Prices.  A chlorine 2019 metric ton price (mt), found on the Internet, is $193.   Apparently chlorine does not vary a lot in price over a period of months.

Production.  Global chlorine 2019 production estimates are in the 70s to 90s million mt range.  With a 2019 price for chlorine of $193 per mt (see prices above), estimated global revenues from chlorine sales in 2019 are from $13.5 billion to $17.4 billion ($193 per mt times 70 million mt and times 90 million mt).

The chlorine production values given above are for producing chlorine gas.   Chlorine is too active to be found in elemental (atomic) form.   However, large amounts of chlorine are found in the earth crust as chlorides, e.g., sodium chloride.  Most chlorine gas is produced by electrolysis of a solution of sodium chloride, forming chlorine gas and sodium hydroxide.

Also, the sales values given above are only for the sale of chlorine gas.  For example, the sales values do not include the sale of the many compounds containing chlorine atoms, such as polyvinyl chloride (pvc).   The chlorine sales revenues do include the sale of chlorine gas used in various processes, such as water disinfection.

Assume the cost of chlorine gas for pvc makers in 2019 is approximately $4.7 billion ((30% (above table) times $15.5 billion (from above, average 2019 chlorine sales revenues)).   And, Internet sources indicate that 2019 pvc revenues was approximately $65 billion.  This suggests that pvc makers had very good margins on chlorine gas purchases ($65 billion pvc sales - $4.7 billion chlorine gas cost = $60.3 billion return; $60.3 billion/$65 billion = 93% margin).

The chlorine gas used in making pvc indicates a value added or multiplier effect.  For example, $4.7 billion of chlorine gas value leads to $65 billion of pvc value.  Quantitatively this could be viewed as a multiplier = 13.8 ($65 billion/$4.7 billion).



Wednesday, March 11, 2020

Benzene – Uses, Prices, and Production


This blog is the fourth in a series of blogs I plan to write providing use, price, and production data on high-use inorganic and organic chemicals.  Click here to see the first blog in this series and a list of chemicals to be featured.  This blog provides data on benzene.

Uses.  Uses of benzene include:

Ø  As a starting material in synthesizing other chemicals;
Ø  As a gasoline additive; and
Ø  As a solvent.

Benzene primary use (more than 90% of benzene used) is as a starting material in synthesizing four chemicals:  ethylbenzene (~50%); cumene (isopropyl benzene) (~20%); cyclohexane (~10%); and nitrobenzene (~10%).  These four chemicals are then in turn used in making many industrial and consumer products.  Benzene’s use is growing (estimated in the 3 to 4% range annually) as demand for the many industrial and consumer products (made from those four chemicals) grow.

Benzene’s use as a solvent is decreasing significantly as benzene needs to handled cautiously, due to its exposure limits for health reasons.

Benzene is derived from petroleum using primarily one of two processes: steam cracking (~40% of benzene produced) and catalytic cracking (~40%).   Benzene is also made from methyl benzene (toluene) (~20% of benzene produced).  Methyl benzene is a by-product in the production of gasoline from petroleum.

Prices.  Global benzene 2019 metric ton (mt) prices appearing on the Internet are mostly in the $700 to $800 per mt range.  Benzene prices can vary considerably over short periods as the prices of the petroleum from which it is derived and the prices of the chemicals, which benzene is used to make, change.  These prices depend on many supply, demand, and other factors, causing the prices to change frequently.

Production.  Global benzene 2019 production estimates are in the high 40s to low 50s million mt range.  Assuming a 2019 average price for benzene of $750 per mt (see prices above) and an estimated 2019 production of 50 million mt, estimated global revenues from benzene sales in 2019 are around $38 billion ($750 per mt times 50 million mt).