World paraffin wax supply shrinking - seller

26 June 2008 22:58  [Source: ICIS news]

GUANACASTE, Costa Rica (ICIS news)--The candle sector is contending with diminished production of its raw material paraffin wax, an industry executive said on Thursday.

“Supply is really tight already because the fully refined paraffin wax is manufactured in only 5% of worldwide refineries, but the situation is getting worse,” said Ricardo Motta Dittmer, technical director of Brazilian wax supplier MEGH.

He was speaking at the eleventh annual Latin American Candle Manufacturers Conference (Alafave) in Guanacaste, Costa Rica.

The future of paraffin wax will depend on Group I base oil production, as wax is a byproduct of the refining process, Dittmer said. “But refiners are cutting back on Group I base oil production as demand for that type of oil decreases, and that is causing paraffin wax supplies to diminish.”

New automotive specifications are driving demand for Group II, II+, III and higher grades of base oils.

In 2003, the Group I base oils were 84% of total world base oil demand, Dittmer said

However, Group I will just be 64% of total world base oil demand by 2015, according to the National Petrochemical & Refiners Association (NPRA).

“We must understand base oil trends to know what will happen with paraffin wax,” Dittmer said. “We can’t get paraffin wax without Group I base oil production.”

In the US, two of the Group I base oil sellers have exited the business this year.

Alternatives to paraffin wax, such as vegetable waxes and hydrogenated tallow, are already a reality for many candle makers, Dittmer said. “There is really not any good news for those who depend on paraffin wax.”

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By: Heather McGuire Doyle
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