Production of Chemicals Abroad by U.S. Firms Grows Production of Chemicals in Foreign Countries by U.S.-Owned Companies

Millions of Dollars

Faster than Chemical Exports 17. & Exports of Chemicals

4000

3500

3000

2500

2000

1500

1000

500

τ£ 1 1

* / S

1957 1960 1961 Source: Office of Business Economics, Department of Commerce

1957 1960 1961

U.S. Companies Make More Overseas Production of chemicals by U.S.-owned firms operating abroad climbed 21% last year to $4 billion

Business was good last year for U.S.-owned chemical companies operating in foreign countries. They boosted output by 2 1 % from the year before to just under $4.0 billion, according to the Department of Commerce ( C&EN, Oct. 1, page 17).

And the gains were scored on a world-wide basis. Output of chemi­cals of U.S. companies in Europe was up 22% to $1.51 billion; output in Canada rose 13% to $1.3 billion; in Latin America it was up 32% to $820 million. For the rest of the world, production totaled $345 million, up 23% from 1961.

Reflecting steadily rising outlays by U.S. chemical firms for foreign plant and equipment since 1959 (C&EN, Sept. 10, page 37), production of chemicals abroad has been climbing more rapidly than that of any other major manufactured product. Since 1957, for example, production of chemicals by U.S.-owned companies abroad has increased by 65%. Next most rapid growth rate since 1957 is the 49% (to $1.3 billion) turned in by paper products. In total volume, moreover, chemicals rank second only

to the $6.0 billion worth of transporta­tion equipment made abroad by U.S. firms last year.

For chemicals, the sharpest growth has come in Europe, where output is up 84 % since 1957. In Latin America, output of chemicals made by U.S. firms is up 64% over the same period, while in Asia, Australia, and Africa combined it has climbed by 79%. Canadian production is up 45%.

Outpacing Exports. But while pro­duction of chemicals abroad has climbed sharply, U.S. exports of chemi­cal products have increased at a much more moderate rate. Last year, the U.S. exported $1.71 billion worth of chemicals, a gain of only 3 % from the year before and of 24% since 1957. As a result, chemical output abroad was 133% higher than exports in 1961.

The greatest increase in exports (as with foreign production) has been to Europe, to which shipments last year totaled $574 million, up 63% since 1957. On the other hand, exports to Latin America actually have declined by 17% since 1957 to $379 million.

Thus exports to Latin America were less than half of production by U.S. firms there last year; in 1957, exports and foreign production in Latin America were nearly equal.

Broad Trend. The rapid rise in production of chemicals abroad is in line with the upsweep registered by over-all manufacturing by U.S. com­panies in foreign countries. Total out­put of overseas manufacturing opera­tions reached $25.6 billion in 1961, an increase of almost 9% from the year before and 40% from 1957, Commerce Department figures indicate. The steepest gains since 1957 have been in Europe, where U.S. manufacturing totaled $10.7 billion, up 70% since 1957. Production of chemicals, food, and machinery showed the biggest gains there last year.

Over-all production in Canada last year amounted to $8.9 billion, un­changed from 1961 but 13% ahead of 1957. Other countries in which manufacturing by U.S. firms is high are: the United Kingdom ($5.1 bil­lion in 1961), West Germany ($2.3 billion), France ($1.2 billion), Aus­tralia ($1.0 billion), and Brazil and Argentina (each with $0.9 billion). The steepest increases last year were in Italy, where production rose by 36% to $475 million, Japan, where there was a rise of 3 1 % to $380 mil­lion, and Argentina, where output was up 29%.

OCT. 8, 1962 C&EN 25

Rep. James J. Delaney (D.-N.Y.) House votes to soften his

anticancer clause

Last week the House and Senate ironed out differences between their respective drug control bills. At press time, passage of the compromise bill seemed imminent. The House ver­sion of the bill, passed the week be­fore, differed so little from that of the Senate that Congressional approval in the rush for adjournment posed no problem.

The House-Senate conferees agreed to a provision in the House version that would require physicians to notify patients that they are receiving an ex­perimental drug. But they modified this requirement by permitting the physicians to waive the proviso if it is deemed contrary to the best interests of the patients.

The conferees also accepted a House requirement that drug producers list, at least in summary, all possible harm­ful side effects in drug advertising ( see below ). But they rejected a Senate proposal that the Government distribute to doctors and clinics infor­mation on side effects and other prop­erties of new drugs. However, they accepted a requirement in the Senate bill that all drug manufacturers must register with the Food and Drug Ad­ministration.

Other key provisions of the Senate bill (C&EN, Sept. 3, page 38) , which

Rep. John Dingell (D.-Mich.) House accepts his proposal on drug ads

late were followed closely by the House heir version, were not changed, ress Despite advance reports that de-bill termined efforts would be made on the ver- House floor to write a tougher bill be- than that reported by the House Com-the merce Committee (C&EN, Oct. 1, 1 in page 19), little real opposition de-no veloped there. After three hours of

rather desultory debate, the House eed passed the bill by a voice vote. 51011 Cancer Clause. One provision of •tify the bill, as approved by the Commerce ex- Committee, would permit the use of

fied suspected carcinogens in animal feeds the if the additive does not harm the ani-it is mal and no residue remains in the ani-ests mal flesh or in animal products for

human consumption, such as milk and >use eggs. Under the Delaney anticancer list, clause, the use of suspected carcino-rm- gens is banned under all circumstances. >ing Rep. Leonor Sullivan (D.-Mo.) pro-1 a posed an amendment to delete the lent animal feed proposal. In her opinion, for- the proposal weakens the anticancer *op- clause, and, since the provision is not hey in the Senate bill, she fears that a late conference might open more loopholes lust in the anticancer clause. Ad- Rep. James J. Delaney (D.-N.Y.)

supported Rep. Sullivan's amendment, late He pointed out that a provision deal-lich ing with animal feeds has no place in

a bill dealing with drugs for human consumption. In view of the possible harmful effects of using suspected car­cinogens, such as stilbestrol, in cattle feeds, he urged that action on the pro­posal be postponed pending further study of this problem. However, after a short debate, the House rejected the Sullivan amendment.

Advertising. As reported by the committee, the House bill would re­quire drug advertising to contain a full statement of possible harmful side ef­fects. However, this would not be necessary if a statement was included in the ad that full details could be ob­tained from the manufacturer.

Rep. John A. Blatnik (D.-Minn.) proposed an amendment that would make listing of side effects and con­traindications mandatory in drug ads. He points out that many busy doctors rely a great deal on drug advertise­ments in deciding what drug to pre­scribe. In his opinion, drug ads should contain all the essential information about a drug so that doctors will have all the facts, both good and bad.

However, some Representatives argued that it would be impractical to list side effects and other detailed in­formation in a drug advertisement in a medical magazine. They feel that including all the required infor­mation in the space allotted would defeat the purpose of advertising.

Rep. John D. Dingell (D.-Mich.) then proposed an amendment to the Blatnik amendment which would re­quire the information to be stated "in brief summary." Some Representa­tives wondered how a "brief sum­mary" could be legally defined to de­termine whether an ad complies with the law. Others failed to see how a capsule presentation could be of any real benefit to doctors. However, after some debate, the House passed the amended amendment.

Other Provisions. In the main, the House bill followed the Senate bill very closely. It would require new drugs to be proved effective as well as safe, would give the Food and Drug Administration authority to take a new drug off the market if there were an imminent hazard to the public health, and would give FDA more time to decide on new drug applications.

The bill would also give FDA much broader authority to make factory in­spections, would require batch cer­tification of all antibiotics, and would require generic names to appear on drug labels.

Drug Bill Moves Toward Passage House-Senate conference irons out differences between two versions to clear way for approval

26 C&EN OCT. 8, 1962

French Chemicals Exceed Planned Growth Output is up 10 to 12%; U.S. competition forces price declines

France's chemical growth target, set in the Fourth Plan at 9 .1% a year, was exceeded during the first half of 1962. The Union des Industries Chimiques estimates a production increase of 10 to 12%.

The 10 to 12% growth is well ahead of the 8% increase of 1961 over 1960; inorganics have grown by 9% and or-ganics by 16%. But UIC points out that results are not all positive. Com­paring tonnages produced during the first six months of 1961 and 1962, ethylene production increased by 54%, polyethylene by 150%, polystyrene 20%, electrolytic soda 28%, chlorine 14%, and ammonia 1 1 % . Below average were the rates for methanol (up 2%) , phenol (up 1%), polyvinyl chloride (7%), sulfuric acid (5%), and sodium carbonate ( 9 % ) . Output ac­tually dropped for calcium carbide (down 4%) and organic pigments, dyes, and paints (down 7%) .

Trade Recovery. A recovery in chemical trading, which, UIC says, was evident during the second half of 1961, strengthened during the first six months of 1962. This was a re­versal of the serious situation caused by a sudden burst of imports in Jan­uary 1962 which drained France of some $8 million. The total gain over the first six months of 1962 was about $13 million.

The sectors of France's chemical in­dustry that managed to increase ex­ports above the industry's average were pharmaceuticals, fertilizers, and plastics. Pharmaceutical exports jumped 30%, fertilizer exports 28%, and plastics exports 24% during this year's first six months compared to the same period a year ago.

Prices Drop. The index of prices for all industrial products in France in­creased very slightly (less than 1%) during the first half of this year, but prices of chemicals turned downward. Based on the old 1952=100 index, chemical prices dropped by 2%, but UIC estimates that the drop was closer to 4%, and even greater for organic chemicals. The lower prices resulted from intense foreign competition on the French market, particularly from U.S. and Italian exporters.

In coming months, the growth in output is not expected to climb beyond 8 to 10% since current inventories are higher than usual. Volume of exports won't change much and UIC estimates that chemical exports for all of 1962 will be valued at about $460 million. UIC expects no recovery in prices since intense foreign competition is likely to continue.

Drug Controls Would Reduce Plans to Expand Drug firms say they'll have to cut expansion plans, do more research abroad

A number of pharmaceutical com­panies say they will have to curtail expansion plans or move abroad if proposed government controls over the research on and testing of new ethical drugs go into effect, as now seems certain (see page 26) .

In a survey conducted by Walter Kidde Constructors, Inc., about -a third of the firms polled said they would cut back on plans to expand plants and labs. About a fourth of them said they would have to relocate facilities abroad. All of the 140 firms that be­long to the Pharmaceutical Manu­facturers Association were polled; about 60% replied. Kidde conducted the survey to determine the impact of the new drug law on its own business, about a third of which is in construc­tion jobs for the drug industry. Re­sults of the survey were sent to mem­bers of the Senate Judiciary Commit­tee and the House Committee on Foreign and Interstate Commerce be­fore the House voted to approve its version of the drug bill.

Small Firms Hit. Kidde says survey results show that smaller firms would be the hardest hit by the proposed drug law. One executive of a small firm says the new controls would ef­fectively eliminate small firms from the area of new drug development. An­other said it would be impossible for smaller companies to continue R&D on new products.

Many of the executives say the controls would raise the cost of drugs. One says that new regulations over clinical investigations would result in a paper-work explosion, a slowdown in drug development, no guarantee of freedom from toxicity, and an increase in the cost of drugs.

As to moves overseas, one executive says obstacles to testing in this country now seem to be so heavy that his firm will probably conduct its work on some promising new botanicals in other areas of the world. Another says he would consider doing more research in a climate more friendly to evaluating new products. A third says his company won't cut down re­search operations here in the U.S., but the company may use foreign facilities for future research.

But not all were pessimistic. One suggested that the industry "wait until the dust settles" before changing plans radically.

New Corn Starch Bids For Paper Market Corn starch is making a bid for prac­tically all of the 600,000-ton market for starch used in paper production. Tests conducted by the Institute of Paper Chemistry, Appleton, Wis., in­dicate that dry-milled corn flour can be used as a substitute for tapioca starch as a beater adhesive to improve dry strength properties of paper and paperboard. The product was devel­oped by IPC under a grant from the Nebraska Department of Agriculture.

Currently, about 150,000 tons a year of tapioca starch are imported for use in paper, trade sources esti­mate. Balance of the market is domi­nated by wet-milled corn starch. Paper makers use a small amount of potato and wheat starch.

The new dry-milled product im­parts strength properties to paper that are equivalent to those obtained with tapioca starch, IPC says. It will be marketed at the same price or lower, will be more uniform in quality than tapioca starch, and it should find use in making lower-priced paper prod­ucts—an area where wet-milled corn starch is too costly to use, the Institute adds. This new market, which could consume up to about 136,000 tons of starch annually, would include wrap­ping and shipping papers, uncoated book papers, folding boxboard, etc.

All told, paper production could take up to 286,000 tons of the dry-milled starch annually, according to Pearle Finigan, director of Nebraska's Agricultural Department. This amount of starch would consume 16.3 million bushels of corn. Wet-milled corn starch now takes about 30 million bushels of corn annually.

OCT. 8, 1962 C&EN 27

BRIEFS

Stauffer Chemical has acquired 76% of the common stock of Urethane In­dustries International, which produces polyurethane foams at Los Angeles, Calif., Chicago, 111., and Franklin, N.J., and has sales in excess of $7 million a year. Stauffer previously owned a substantial amount of Urethane In­dustries' convertible debentures. Ure­thane Industries' Franklin plant is op­erated by its wholly-owned subsidiary, American Urethane, which it acquired earlier this year (C&EN, April 16, page 35) as Stauffer-Hewitt, a me­thane foam company formerly owned jointly by Stauffer and Hewitt-Robins.

Omega Chemical Co. has been formed by Alcolac Chemical, Baltimore, Md., and Kyros Corp., Madison, Wis. The new firm plans to commercialize patent applications filed by Kyros in surfac­tant technology.

Olin Mathieson has bought Pacific Coast Foil Corp., South San Francisco, Calif., and will operate it as Olin Foil Packaging Corp. The Pacific Coast firm makes a variety of foil- and vinyl-laminated packaging products for foods and beverages. Its sales last year totaled $4.5 million.

NEW FACILITIES

Humble Oil & Refining is building a multipurpose chemical plant at its Baton Rouge, La., refinery. The $2 million unit will turn out chemicals in volumes between pilot plant and full commercial scale. When completed in mid-1963, the unit will make cy-clododecatriene, now sold in develop­ment quantities by Enjay, Humble's marketing division. Other products will be trimethylol, trialkyl acetic acids, oxoaldehydes, propane, olefins, diolefins, and aromatics.

Du Pont will build a plant at Circle-ville, Ohio, to make Teflon FEP (fluorinated copolymer of ethylene and propylene) film. Du Pont has had the film under development since 1957 and has been making commercial quantities at a semiworks in Buffalo, N.Y., since 1959. The Ohio plant is scheduled to begin production early in 1964.

St. Regis Paper Co.'s J. Neils Lumber Co. division has started to produce STRactan ( arabinogalactan ) at a new plant in Libby, Mont. The poly­saccharide is used as a dispersing agent to make either oil-in-water or water-in-oil emulsions with low viscosity. The plant has a capacity for more than 300,000 pounds a year.

Union Carbide's Linde Co. division has expanded its gaseous nitrogen facilities at Pittsburg, Calif., by 30% to meet increased requirements of U.S. Steel's nearby tin plate mill.

Penray Co. has completed a $240,000 plant and office building in Centex Industrial Park, near Chicago. The company makes automotive waxes, polishes, cleaning compounds, and oil and cooling system additives.

National Lead has opened new re­search labs at Hightstown, N.J., to re­place facilities located in Brooklyn. The new building, first unit of what is to be a research complex on the 250-acre site, has four laboratory wings connecting to a central core which contains service laboratories. A fifth wing is devoted to administrative of­fices and the sixth contains the li­brary and cafeteria. Research will be devoted to pigments and coatings, nonferrous metals, storage batteries, lead chemicals, and organic and poly­mer chemistry.

WEEK'S PRICE CHANGES October 1, 1962

Advances

CURRENT PREVIOUS

Riboflavin, vitamin B2, imported, kilo. $36.00 $32.00

Silver bullion, oz. 1.2172 1.16 * Silver salts, avoir, oz.

Chloride, powd. 0.94375 0.9157 Cyanide 0.94 0.91 Nitrate 0.8000 9.7760 Oxide 1.147s 1.117s

Declines

Ionones, lb. Alpha-beta $6.10 $6.55 Methyl 5.60 6.40

Polyvinyl alcohols, truckloads, lb. Medium viscosity 0.57 0.64 High viscosity 0.57 0.62

Tin metal, lb. 1.0872 1.087s * 1000-ounce lots

The National Cylinder Gas division of Chemetron has a new acetylene plant in operation at Tampa, Fla. The company has also started pipeline de­livery of ultrahigh-purity hydrogen to Texas Instruments' semiconductor plant in Dallas, Tex., from its new on-site plant there.

Delhi-Taylor has completed facilities to make pseudocumene at its Corpus Christi, Tex., plant. Chemically, the product is 1,2,3-trimethylbenzene.

Schering's new $5.5 million produc­tion center at Union, N.J., is in full operation. The new building has more than 9 acres of floor space, allow­ing the company to consolidate all manufacturing, warehousing, and packaging under one roof.

FINANCE

Gulf Oil is increasing its quarterly cash dividend from 35 cents to 40 cents a share with the dividend payable Dec. 7. But the company's board of di­rectors has decided to eliminate the stock dividend Gulf has been paying at varying rates since 1952, since it feels the company now has less need to conserve cash for capital spending than it did earlier. Gulf's cash divi­dend was increased from 30 cents to 35 cents a share in the first quarter of 1962, after having been raised from 25 cents in last year's third quarter.

American Enka has increased its quar­terly dividend by 10 cents to 50 cents a share with its Oct. 6 payment.

Reynolds Metals has sold $50 mil­lion worth of 5 3 / 8 % first mortgage bonds through a private placement. Proceeds will be used for the most part to refinance existing debt.

INTERNATIONAL

Interchemical has acquired Fabrica Italiana Colori Inchiostri Stampa, S.p.A., Italy's biggest producer of printing inks. FICIS, headquartered at Bollate, a suburb of Milan, has an­nual sales of about $3 million. The acquisition was made for cash, but no

28 C & E N OCT. 8, 1962

further financial details were revealed. The Italian firm's major products are lithographic and letter press inks, and Interchemical expects to complement FICIS's efforts in gravure and flexo graphic inks.

Amercoat Europa, N.V., has started operations in Geldermalsen, the Netherlands, for making protective coatings and acid- and alkali-resistant cements for sale in Europe and the Near and Middle East. The Dutch firm is owned by Amercoat Corp., South Gate, Calif., and Chamotte-Unie, N.V., a publicly held Dutch company. Amercoat Corp's parent is American Pipe and Construction Co.

South African Coal, Oil and Gas Corp. will build a nitrogen complex in Sasol-burg in the Orange Free State. The construction contract has been awarded to Simon-Carves (Africa) (Pty.), Ltd., a member company of Simon Engineering, Ltd., Great Brit­ain. The plant will have a daily ca­pacity for 151 tons of ammonia, 61.5 tons of nitrogen in 56% nitric acid, 120 tons of nitrogen in 82% am­monium nitrate solution, and 75 tons of nitrogen in lime-ammonium nitrate fertilizer.

Britisr Hydrocarbon Chemicals, Ltd., has awarded the construction contract for an isobutylene extraction unit to be built at its Grangemouth works to Badger, Ltd. The extraction process, developed by Compagnie Française de Raffinage, can produce polymeriza­tion-grade isobutylene from a mixed C4 stream containing 30% or more of butadiene with a product recovery of over 90%.

G. D. Searle de Mexico Pharmaceutical division of Products Esteroides, S.A. de C.V., G. D. Searle's Mexican sub­sidiary, has completed facilities for making steroid-based pharmaceuticals in Mexico City.

Interprovincial Co-operatives, Ltd., will build multimillion dollar chemical facilities at Saskatoon, Sask. To be included are a caustic-chlorine unit, which Vickers Krebbe, Ltd., Montreal, will build, and a herbicide unit, which B. D. Bohna, Ltd., Vancouver, B.C.,

will build. Construction has already started and is slated for completion by the end of 1963. Other products may eventually be made at the site.

Australian Fertilizers, Ltd., will build a wet process phosphoric acid plant at Port Kembla, New South Wales. Dorr-Oliver Pty., Ltd., Sydney, has the construction contract. Capacity is to be 100 long tons (on a P 2 0 5 basis) a day.

American Cyanamid and Italy's Coloro-ficio Italiano Max Meyer, S.p.A., Milan, have formed a new company in Italy for the production of synthetic resins. The new firm will be called Cyanamire, S.p.A. Cyanamid holds the majority interest in the new firm and will be responsible for technical service and marketing of the new firm's products. A new manufactur­ing unit will be built next door to Coloroficio's Milan plant. The Italian firm, which makes paints, varnishes, and lacquers, will be responsible for manufacturing operations. Mean­while, Cyanamid's Italian subsidiary, Cyanamid Italia, S.p.A., has com­pleted a $1 million plant for the man­ufacture of antibiotics and malathion insecticide at Catania, Sicily.

International General Electric has been awarded the prime contract to build India's projected $100 million atomic power plant. The plant, to be located about 60 miles north of Bombay, will have a 380,000 kw. boiling water re­actor, consisting of two 190,000 kw. units. It will use slightly enriched uranium fuel. GE says the contract is the largest it has ever undertaken. The construction schedule calls for the plant to go critical in 1966.

Chemstrand will form a new Euro­pean organization, as yet unnamed, to manage its expanding interests in Europe. The new company will have over-all responsibility for Chemstrand, Ltd., which makes acrylic fibers in Northern Ireland; Israel Chemical Fibers, which is building an acrylic fiber plant at Ashdod, Israel; Poly-thane Fibers, which will make span-dex yarns in the United Kingdom; and Lansil, Ltd., which makes cellu­lose acetate flake and yarn in the United Kingdom.

AT LAST! A PORTABLE VACUUM CARRIER

Just ONE of α COMPLETE LINE of PORTABLE SYSTEMS from PENN-CHEM including:

Portable Vacuum Assembly Carrier (Illustrated—Model V-2000 R) AH Purpose Carriers Portable Lab Racks Portable Towers Cantilever Carriers Glassware Carriers

These hardworking carriers put virtually every laboratory operation ON WHEELS. VERSATILE? Sets up for scores of uses . . · • Vacuum Pumps & Accessories • Distillation Columns &

Accessories • Column Chromatographic

Equipment • Gas Analysis Apparatus • Reaction Set-ups • Filtration Equipment, etc.

For catalog and prices contact your laboratory supply dealer or write Dept. B-10

U i . l . U l l J . , I J . U . I ! B f W 232-38 N. MARSHALL STREET LANCASTER, PENNSYLVANIA

OCT. 8, 1962 C&EN 29