11 November 2010 20:51 [Source: ICIS news]
HOUSTON (ICIS)--Worldwide production of paraffin wax is declining, and the industry needs to find alternatives to prevent shortages in the next decade, a US wax supplier said on Thursday.
In the short-to-medium term, a shortage of paraffin wax will pressure prices, but these will become more elastic as customers shift to alternative products, Jose Luis Montes, manager of the wax division at Schumann/Steier Inc (SSI), said.
Montes made his comments during a presentation at the National Petrochemical & Refiners Association (NPRA) International Lubricants & Waxes meeting.
The expected decline of Group I base oil production, in favour of Group II and Group III, will reduce the availability of paraffin wax, Montes said. Around 750,000 tonnes of wax capacity had been lost since 1995, he added.
Demand for wax had been increasing over the same period. Montes said that the volumes required by the US candle industry had exploded in the late 1990s, but that wax demand was now growing fastest in the polyvinyl chloride (PVC) sector, where it is used as a plasticiser.
The wood-board industry was also placing strong demand on the shrinking supply of slackwax, he said.
Wax from soy, palm and tallow was already extending the supply of wax in some industries, with soy-based wax being favoured in the US and palm-based wax used more widely in Asia and Europe.
Already, 30-35% of wax used in candles derives from these lower-priced alternatives to paraffin wax.
David Hess, of South Chicago Packing, said tallow-based wax would also fill a gap as markets looked to replace lost paraffin wax and extend the supply of hydrocarbons.
Synthetic routes to wax production were also an alternative, Eduard Baralt of Chevron Phillips Chemical, said.
Alpha olefin waxes derived from ethylene could also be used as a paraffin wax extender, he said. These could improve colour and opacity and offered good mould-release properties.
Greater production of Fischer-Tropsch waxes depended on developments in gas-to-liquids technology, Tony Cook, of Sasol Wax North America, said.
Although these waxes were fully interchangeable with paraffin waxes, they were not expected to play a major role in meeting the shortfall, he said. Fischer-Tropsch wax production would compete for feedstock natural gas with diesel production and lubricant base oils, he added.
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