Benzoic Acid  

*Millions of pounds per year. Benzoic acid, a crystalline white solid, is produced commercially by partial oxidation of toluene. Most material is consumed captively in the production of a variety of industrial chemicals. It is estimated that 95 million pounds or 45 percent of Noveon’s benzoic acid is used captively to produce phenol, in a second partial oxidation process.

In 1997 Kalama Chemical, Kalama, Wash., increased benzoic acid capacity from 170 to 210 million pounds. BF Goodrich acquired Kalama Chemical, in 1998. Then, in February 2001, Goodrich Corporation sold its entire Performance Materials division, including the Kalama operations, to an investment group led by AEA Investors. The new company was renamed Noveon.

In 1999, Vesicol expanded benzoic acid capacity in Chattanooga, Tenn., from 65 to 75 million pounds.

Nipa Hardwicke, a subsidary of BTP PLC, became the only domestic producer of USP benzoic acid after acquiring the USP businesses of Kalama Chemical in 1994 and Velsicol in 1998. In 1999, BTP reorganized its fine chemicals and biocides operations to focus on worldwide markets through global business units. The company's fine chemicals activity, was renamed Archimica. Archimica produces USP benzoic acid at its Elgin, S.C., plant.

Profile last published, 5/3/99; this revision, 3/4/02.

DEMAND
1999: 129 million pounds; 2000: 134 million pounds; 2004: 150 million pounds, projected. Demand equals production plus imports (1999: 31 million pounds; 2000: 20 million pounds) less exports (1999: 49 million pounds; 2000: 65 million pounds).

The data exclude benzoic acid used for Noveon’s production of phenol (about 95 million pounds), as crude, unisolated benzoic acid is consumed in this application.

GROWTH
Historical (1995 - 2000): 3.2 percent per year; future: 2.9 percent per year through 2004.

PRICE
Historical (1995 - 2000): High, $0.63 per pound, list, tech., bgs., f.o.b. whse.; low, $0.63, same basis. Current: $0.63, same basis. Contract pricing is approximately one-third less than list.

USES
Benzoate plasticizers, 49 percent; sodium and potassium benzoates, 24 percent; benzoyl chloride, 12 percent; alkyd resins, 4 percent; n-butyl benzozte, 2 percent; miscellaneous, including pharmaceuticals and as a preservative in surface coatings, emulsions, polishes, waxes and liquid detergents, 9 percent.

STRENGTH
Benzoate plasticizers (primarily dibenzoate esters) are used mainly in polyvinyl acetate–based (PVAc) emulsion adhesives, caulks and sealants. Benzoates impart flexibility to PVAc emulsions and increase its adhesion to nonporous substrates such as film, foils and coated paper. Dibenzoates compete with phthalate plasticizers in these applications, but dibenzoates have better growth prospects than the phthalates; partly as a result of continuing environmental pressure on phthalates and as dibenzoates replace phthalates in certain other applications. This sector represents nearly 50 percent of benzoic acid’s demand and it is the most robust, growing at nearly 3 percent. For comparison, U.S. GDP increased only 1.1 percent in 2001. Sodium and potassium benzoates are used as preservatives in a variety of foods and beverages. This segment is also outperforming GDP growth and accounts for nearly one quarter of benzoic acid demand.

WEAKNESS
Benzoic acid improves the hardness, gloss, adhesion and chemical resistance of alkyd resin surface coatings. Demand for alkyd surface coatings has been negatively influenced by clean air regulations limiting the level of volatile organic compounds (VOCs) in these products. Substitute coating technologies, particularly acrylic latexes and to a smaller degree by epoxies, urethanes, polyesters and vinyls, are contributing to a slowly declining situation.

OUTLOOK
Benzoic acid continues to outpace the general economy, primarily due to the healthy demand for benzoate plasticizers. This description, however, does not consider benzoic acid used for phenol, which has been hit hard by the economic contraction. Growth for benzoic acid through 2004 is forecasted at 2.9 percent per year. On the supply side, toluene is plentiful and prices hit a low of $0.69 per gallon in December. Capacity is comfortable as the industry is operating at less than 80 percent capacity, including benzoic acid manufactured as an intermediate for phenol.

*The data excludes benzoic acid used for the production of phenol, as crude, unisolated benzoic acid is consumed in this application.