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Reduced demand for refined cresol products has caused major companies in the cresylic chemical markets to shift their strategies. For example, Sasol Ltd, the largest supplier of cresylic raw materials, is moving into the refined cresol product markets. Merichem Co, which was one of Sasol's largest customers, has shifted to a new supplier: Dakota Gasification Co. Meanwhile, Dakota Gasification is developing its own refining technology and may enter the refined cresol market in the future.

Cyclodextrins, which are toroidal rings of sucrose molecules, are seen as a major growth market due to their ability to bind other molecules within their ring structure. 1992 market demand is 2-5 million pounds, but that could grow to 100 million pounds annually by 2007. One of the first major users of cyclodextrins is Cholorex, a Michael Foods Inc-SKW Nature's Products Inc joint venture, which uses cyclodextrins to extract cholesterol from egg products. Other potential markets and producers of cyclodextrins are also discussed.

The plastic compounding business, in which basic resins are mixed with colors and additives, has become a major part of the plastics industry and accounted for 12.5 billion pounds of thermoplastic demand in 1991. According to R.W. Unterreiner of Sterling Consultants, the plastics compounding business consists of 4 major market segments: dry colored resins, polyvinyl chloride (PVC), color and additive concentrates and reinforced resins. Color resins are the largest market, 7.2 billion pounds annually, while concentrates are the fastest growing segment.

Union Camp Corp. believes that supplies of crude tall oil (CTO) from softwood pulp mills will be sufficient for the company to continue producing CTO rosin, fatty acids and other derivatives. Union Camp has invested $80 million in its business since 1990. The company is trying to boost the recovery of CTO from wood, seeking global sources of CTO, and using non-CTO materials such as vegetable fatty acids and gum rosin.

The Chilean mining company Minsal S.A. plans to begin producing lithium carbonate for commercial use in January 1997 and sell the commodity for 90 cents a pound, well below the present price of $1.50 to $2. Minsal hopes to stimulate greater demand from aluminum and specialty glass manufacturers with the lower price. The strategy is possible because Minsal minimized the cost of its lithium carbonate operations, which are an outgrowth of an existing potassium chloride facility.

Dr Hans Dieter Winkhaus, CEO of Henkel KGAA, is cautiously optimistic about his company's future. The company has restructured its operations to focus on six major businesses balanced between chemicals and consumer products. The balance of products and the wide geographic distribution provide stability. The company plans to continue to develop new products based on its alkyl polyglycoside technology.

Vista Chemical Co and Petroleos Mexicanos (Pemex) have signed a preliminary agreement concerning Vista's plans to build a linear alkylbenzene plant in Mexico. Pemex will supply feedstock chemicals for the $250 million plant, which will produce 260-330 million lbs/yr. Final agreements are expected to be signed during the first six months of 1993, and the plant is expected to come on-stream in 1996.

Producers of polyaluminum chloride (PAC) predict strong demand from water treatment plants and paper manufacturers. However, the PAC supplied by different producers varies in quality. For water treatment, PAC is superior but more costly than alum. Sternson Ltd, which reports 40% growth in sales, plans to build three plants in the US within the next six years. The company wins contracts for its expensive product because of high performance ratios.

Prices in the benzyl alcohol market are rising due to a disruption in European production. DSM Belgium NV had an explosion at its benzoic acid plant in Rotterdam, Netherlands, late in 1991. This resulted in reduced production of benzyl alcohol and, several months later, in a tightened market and a price increase of nine to 10 cents per pound. The US imported 1.5 million pounds of benzyl alcohol from the Netherlands between Jan and Apr 1991 but only 312,000 pounds during the same period of 1992, according to Census Bureau data. Though DSM resumed production in Mar 1992, the market is expected to remain tight until 4th qtr 1992.

A coalition of US antimony oxide (Sb2O3) producers is unhappy with an anti-dumping ruling against Chinese sales agents China Minmetals and CNIEC. The International Trade Commission did find that the two companies were selling Sb2O3 in the US below fair market value, but it imposed separate duties of 80.64% on China Minmetals and 13.05% on CNIEC. The coalition feels that the 13.05% duty is insufficient and that Chinese Sb2O3 manufacturers may simply shift to selling through CNIEC to avoid the higher duty.

Acetate ester production has run at 94% of capacity from Mar 1992 through Feb 1993, but prices are not high enough to enable producers to consider extensive capacity expansions. Producers have seen a dramatic increase in demand for acetate esters as alternatives to traditional solvents like xylene and toluene that contribute to air pollution. The long-term future of acetate esters is uncertain, since use of all solvents is likely be reduced or eliminated by regulators.

The early 1992 chlorine and caustic soda markets are exhibiting behavior typical of an economic recovery, when chlorine demand rises much faster than caustic soda demand. Chlorine demand is particularly high in the Gulf of Mexico area, where vinyl chloride manufacturers have difficulty finding enough chlorine for their needs. In other regions, chlorine demand is slack, largely due to effort to reduce chlorine use in paper chemicals, solvents and chlorofluorocarbons. Caustic soda demand is weak nationwide and the low demand is delaying plans for new caustic soda facilities.