Stable Alcohol Costs Forecast at Market Research Meeting

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Richard F. Warren* (Jhen*.icaI Engi- neering: Sam P. Gibson* president of Chemical Market: Research As- sucitition; Charles L. Gabriel, Pub- lickvr Industries* Inr.^ind (speak- ing) fames C Park, Ε ηjay Co., Inc. Stable Alcohol tots Forecast at Market Research Meeting A STAFF REPORT 3YNTHKTIC alcohol will In* a factor in stabilizing or lowering raw materials costs in other solvents processes, notably molasses, it was coritt'tiili'd before the meeting of the Chemical Market Research Association in Xew York ('it v, Oct. 7. In a discussion of fermentation proc- esses, Charles L. Gabriel, vice president, Publickcr Industries, Philadelphia, also thought that, because of location as well as product and plant cossts, present molas- ses alcohol plants will continue to op- crate competitively for many* years. After reviewing the situation in molasses since the inflation in 1920, Dr. Gabriel said: "I think that the price of molasses will be reasonable. Blackstrap molasses can- not be dumped on the ground by the sugar mills, and if they cannot sell it they must take it to sea for disjiosal. This costs money, and the (Cuban) mills would be better off if thev gave the blackstrap molasses away to concerns who would store it and carry it off in tankers. "There has been a substantial increase in the production of alcohol from ethylene since 1941, and in 1950 alcohol obtained in the Fischer-Tropsch process may be- come available. Production of synthetic alcohol is bound to have a stabilizing effect on the cost of molasses and its price must be low enough to enable the alcohol fermentation industry to compete on a fair basis with alcohol produced by syn- thesis, whether obtained as a by-product or not." Dr. Gabriel felt that molasses would be available at a reasonable price and in sufficient quantities to supply existing industrial alcohol fermentation plants. These will produce and distribute alcohol competitively with the synthetic product. He estimate»I that before the war, in a well-operated large alcohol fermentation plant, molasses constituted 75% of the total production cost. Since 2.5 gallons of molasses containing 50% sugar is re- quired for 1 gallon of 95% alcohol, it is evident that low cost molasses means a rea- sonable production cost for alcohol. De- preciation charges in molasses alcohol plants now in operation ought to he substantially lower than in synthetic alcohol plants recently built or to be built. Tin» cost of a plant to refine the oxy- genated compounds obtained in the Fischer-Tropsch process is not low, and the alcohol must be separated, the speaker said, not only from materials boiling below and above it, but also from several chem- icals which distill at practically the same temperature as does alcohol. Process and amortization costs are not apt to be too low. Plants to produce alcohol from eth- ylene are costly as compared with fermen- tation projects of similar capacity. The present plants for making alcohol from molasses were built when costs were much less than half of recent figures and these plants are well depreciated. Molasses alcohol plants, especially those on the eastern coast, also will continue to enjoy lower shipping costs than synthetic plants. Syn I he t ic Solvents Dr. Gabriel was followed by James G. Park, vice president, Enjay Co., Inc., who discussed the synthetic, processes for solvents. Industrial ethyl alcohol has become one» of our most basic chemicals for a host of manufacturing processes. Its greatest outlet, he said, is for acctaidehydc, which consumes about 40% of the total produced. From acetaldehyde comes acetic acid, and anhydride for cellulose acetate manu- facture. It is also the source of synthetic η-butyl alcohol and 2-cthylhexanol. Other industrial solvents were described. Isopropyl alcohol has been growing in commercial importance since the early 20's. It is made from propylene gas and it is the source for 85% of the national output of acetone, hence a source for ace- tic anhydride, diacetone alcohol, methyl isobutyl ketone, and numerous other derivatives. The glycols have risen from small be- ginnings around 1922 to a capacity which today is distributed among five producers, of perhaps 350 million pounds. Mr. Park said that the capital invest- ment involved in hydrocarbon synthesis is heavy, but this is a characteristic of all synthetic solvents. For example, the capital requirements for a synthetic etha- nol plant with the large amounts of acid resisting equipment and facilities to pro- duce ethylene and recovering acid is heavy—considerably larger than for the fermentation process. ''Despite the handicap of large capital i!ιvestment, ,, Mr. Park continued, "the evidence is that production of solvents by synthesis from petroleum is cheaper than the production by fermentation, in the present state of efficiency of the latter, or unless fermentation raw materials arc available at such levels as prevailed dur- ing the thirties. "The evidence of lower costs is con- firmed by the fact that where» the same product is made by fermentation and by synthesis, the price tends to come down. Again, cthanol is a case in point. Take the 10-year period from 1930 to the outbreak of the war, when synthetic production was steadily rising, and we find a fairly defined 3194 CHEMICAL AND ENGINEERING NEWS

Transcript of Stable Alcohol Costs Forecast at Market Research Meeting

Richard F. Warren* (Jhen*.icaI Engi­neering: Sam P. Gibson* president of Chemical Market: Research As-sucitition; Charles L . Gabriel, Pub-lickvr Industries* Inr.^ind (speak­ing) fames C Park, Ε η jay Co., Inc. Stable Alcohol

tots Forecast at Market

Research Meeting A STAFF REPORT

3 Y N T H K T I C alcohol will In* a factor in stabilizing or lowering raw materials costs in other solvents processes, notably molasses, it was coritt'tiili'd before the meeting of the Chemical Market Research Association in Xew York ('it v , Oct. 7.

In a discussion of fermentation proc­esses, Charles L. Gabriel, vice president, Publickcr Industries, Philadelphia, also thought that, because of location as well as product and plant cossts, present molas­ses alcohol plants will continue to op-crate competitively for many* years.

After reviewing the situation in molasses since the inflation in 1920, Dr. Gabriel said:

"I think that the price of molasses will be reasonable. Blackstrap molasses can­not be dumped on the ground by the sugar mills, and if they cannot sell it they must take it to sea for disjiosal. This costs money, and the (Cuban) mills would be better off if thev gave the blackstrap molasses away to concerns who would store it and carry it off in tankers.

"There has been a substantial increase in the production of alcohol from ethylene since 1941, and in 1950 alcohol obtained in the Fischer-Tropsch process may be­come available. Production of synthetic alcohol i s bound to have a stabilizing effect on the cost of molasses and its price must be low enough to enable the alcohol fermentation industry to compete on a fair basis with alcohol produced by syn­thesis, whether obtained as a by-product or not."

Dr . Gabriel felt that molasses would be available at a reasonable price and in sufficient quantities t o supply existing industrial alcohol fermentation plants. These will produce and distribute alcohol competitively with the synthetic product.

H e estimate»I that before the war, in a

well-operated large alcohol fermentation plant, molasses constituted 7 5 % of the total production cost. Since 2.5 gallons of molasses containing 50% sugar is re­quired for 1 gallon of 95% alcohol, it is evident that low cost molasses means a rea­sonable production cost for alcohol. De­preciation charges in molasses alcohol plants now in operation ought to he substantially lower than in synthetic alcohol plants recently built or to be built.

Tin» cost of a plant to refine the oxy­genated compounds obtained in the Fischer-Tropsch process is not low, and the alcohol must be separated, the speaker said, not only from materials boiling below and above it, but also from several chem­icals which distill at practically the same temperature as does alcohol. Process and amortization costs are not apt to be too low. Plants to produce alcohol from eth­ylene are costly as compared with fermen­tation projects of similar capacity. The present plants for making alcohol from molasses were built when costs were much less than half of recent figures and these plants are well depreciated. Molasses alcohol plants, especially those on the eastern coast, also will continue to enjoy lower shipping costs than synthetic plants.

Syn I he t ic Solvents Dr. Gabriel was followed by James G.

Park, vice president, Enjay Co., Inc., who discussed the synthetic, processes for solvents.

Industrial ethyl alcohol has become one» of our most basic chemicals for a host of manufacturing processes. Its greatest outlet, he said, is for acctaidehydc, which consumes about 40% of the total produced. From acetaldehyde comes acetic acid,

and anhydride for cellulose acetate manu­facture. It is also the source of synthetic η-butyl alcohol and 2-cthylhexanol.

Other industrial solvents were described. Isopropyl alcohol has been growing in commercial importance since the early 20's. I t is made from propylene gas and it is the source for 85% of the national output of acetone, hence a source for ace­tic anhydride, diacetone alcohol, methyl isobutyl ketone, and numerous other derivatives.

The glycols have risen from small be­ginnings around 1922 to a capacity which today is distributed among five producers, of perhaps 350 million pounds.

Mr. Park said that the capital invest­ment involved in hydrocarbon synthesis is heavy, but this is a characteristic of all synthetic solvents. For example, the capital requirements for a synthetic etha-nol plant with the large amounts of acid resisting equipment and facilities to pro­duce ethylene and recovering acid is heavy—considerably larger than for the fermentation process.

''Despite the handicap of large capital i!ιvestment, , , Mr. Park continued, "the evidence is that production of solvents b y synthesis from petroleum is cheaper than the production by fermentation, in the present state of efficiency of the latter, or unless fermentation raw materials arc available at such levels as prevailed dur­ing the thirties.

"The evidence of lower costs is con­firmed by the fact that where» the same product is made by fermentation and by synthesis, the price tends to come down. Again, cthanol is a case in point. Take the 10-year period from 1930 to the outbreak of the war, when synthetic production was steadily rising, and we find a fairly defined

3194 C H E M I C A L A N D E N G I N E E R I N G N E W S

downward trend in the price of ethyl alcohol.

" I n 1929, before synthetic ethanol had appeared on the market , t he tank car price for SD (specially denatured) No. 1 ethanol was 41 cents per gallon. In 1939, when synthetic ethanol production was running a t about 20 million gallons per year compared with a total production of about 120 million, the price of ethanol was in the low 20's. Dur ing the war when ethyl alcohol reached the enormous out­p u t of 600 million gallons, the fermenta­tion product costing anywhere from 50 cents to $1.00 per gallon was sold at the Government 's subsidized price of 52 cents,

while synthetic was pegged a t 24 cents." Mr. Park contended t ha t one of the

principal reasons why synthetic prices tend to be lower than fermentation prices is that the synthetic product has the ad­vantage of a raw material supply a t a more stable cost. This is not to say that pe­troleum raw materials are static in price, but they are net subject to the same wide fluctuations which beset fermentation raw materials because of t he vagaries of nature and the ups and downs in supply.

Haw material sources for the solvent industry were outlined by Richard F. Warren, marketing editor of Chemical Engineering. Mr. Warren described the

growth, of the solvents industry in this country duxing the early 20's, especially t h a l i > a r t o f it based upon the production of biLtanol^ acetone, and ethyl alcohol through t h e Weizman fermentation proc­ess. IThc r i se of the automobile industry, through its need of butanol, e thyl and amyl acetates a s well as butyl acetates, figured in thkis expansion.

Sam P. Ciibson, Jr . , Commercial Sol­vents Corp. , president of the CMRA, pre­sided a t the meeting. During the evening, at dinner in· the Hotel Biltmore, members heard a discussion of the basing point de­cision in tli€3 cement case by E. B . Paust , law departrxient, Esso Standard Oil Co.

Analytical Work of AOAC Broadens A STAFF HEPORT

J_ HE Association of Official Agricultural Chemists, Inc., convened at the Shoreham Hotel , Washington, 1). C , for its sixty-second annual meeting, Oct. 11 to 13, with 466 members registered.

Probably the most far-reaching action taken was the decision to amend the constitution with respect to the classi­fication of methods of analysis, Methods will no longer be designated as " t en ta t ive" b u t instead as "first action." "First ac t ion" methods will remain in tha t s ta tus for a year before they can become "official" and all methods must first be subjected to collaborative s tudy.

Another important change in procedure was the association's decision to discon­tinue its activities on the formulation of definitions and standards for fertilizers. This action, however, has nothing what­ever to do with methods of analysis for fertilizers, which will continue to be an impor tant part of the work of the organi­zation.

T h e meetings were divided into three sections, all meeting simultaneously with t h e exception of the general sessions Monday morning when President George H . Marsh, director, chemical division, Montgomery, Ala., called the meeting to order, the concluding session Wednesday afternoon when general business was discussed, and on Tuesday afternoon when all of the members assembled to hear the annua l presidential address on "Composi­t ion Found by Analysis with Therapeutical Claims for Some Proprietary Medicines." D r . Marsh pointed out tha t the t ramp medicine man, ever getting slicker and cheaper, is especially active in rural areas in the South and is the direct descendant of the "hawker" who formerly peddled mysterious Indian remedies a t county fairs or on street corners Saturday nights. Now he operates under cover and is much harder to apprehend.

T h e broad scope of the field covered by the association in its study and de­

velopment of analytical methods is at­tested by the fact that referees and their associate referees presented reports on approximately 150 subjects. A number of contributed papers were also given. A new field of work upon which the associa­tion has embarked is the development of chemical tests as a criterion for the detec­tion of decomposition in foods. Several contributed papers indicate that definite progress is being made in this field and that food chemists are actively collab­orating to develop and perfect such chemical methods. In addition to the above, the Wednesday afternoon general session was given over to the presentation of the usual committee reports and rec­ommendations.

The association was honored in having present the sole surviving founding member of the organization—Henry A. Huston. Dr. Huston celebrated his nintieth birth-da3r on April 20 and is still active and

interested i n the affairs of the association and in life in general.

Before adjourning the association paid tribute to the following members who have passed away within the year; Josepih A. Ambler, Edward M . Bailey, Philip E. Blackerby, E. Peck Green, William F_ Hand, Horace T. Herrick, Alfred V. Komi, William D . Lynch, Alan Leigh ton, TTlmdcieus S. Morris, Harry J. Paterson, -Arthur E. Paul, Ray Powers, A. L. Sulli-van, Alfred E. Taylor, Harry IX Wilson, and K. II. Yunker.

The following men were elected to guide the destinies of the organization during the coming year; president, L. S. Walker, Agricultural Experiment Sta­tion, Burlington, Vt.; vice president W. A. "Quee-n, Washington, D . C\; emeri­tus secreta-ry-t reasurer, W. W. Skinner, Washington, D. C ; secretary-treasurer, Henry A. Lepper, Washington, D . C ; additional members of executive com­mittee, H - A. Halvorson, St . Paul, Minn., W. B. White, Washington, D . C ; H . J. Fisher, New Haven, Conn.; G. H. Marsh, Montgomery, Ala.

The next annual meeting will be held in Washington, D. C , Oct. 10 to 12, 1949.

Officers of AOAC. H. A. Lepper, Food and Drug Administration, secretary-treasurer; G. H. Marsh, Alabama Department of Agriculture and Industry, president; L. S. Walker, Vermont Agricultural Experiment Station, vice presi-dent; W. B. White, Food and Drug Adrninistrillion, e^dilor

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