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Sunday, February 05, 2012
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Summary of Supply Chain and Material Alerts Issued by Rx-360 (Click on Icon) Past Issues of Rx-360 Flash Reports 
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Guar Gum Shortage Minimize
Guar gum is a polysaccharide (galactose/mannose) used to thicken various liquids.  Guar gum powder is used in the pharmaceutical industry as Gelling/ Viscosifying/Thickening, Suspension, Stabilization, Emulsification, Preservation, Water Retention/Water Phase control, Binding, Clouding/Bodying, Process aid and in tablet manufacturing it is used as a binder and disintegrating agent and in micro-encapsulation of drugs.

The reason for the shortage is not fully understood; however, the Oil & Gas industry also uses Guar gum in hydraulic fracturing to prevent fluid loss.   The increase in hydraulic fracturing has caused previous a previous raw material shortage in the pharmaceutical industry (see Rx-360 Flash Report on the Hydrochloric Acid Shortage by clicking here
 

One source states that the weak sugar harvest in Brazil is playing a role, while others state that Oil & Gas has increased their consumption.  Most likely both issues are contributing to the shortage, and ultimately, price volatility.

Firms who use guar should consider taking the following actions: 

1. Contact your supplier and assure their ability to supply
 
2. Assess and understand the Guar gum supply chain for vulnerabilities that could cause supply interruptions and product authentication concerns
 
3. Secure a supply of Guar gum from a trusted supplier
 
4. Conduct full analytical testing upon receipt of Guar gum 
 
Rx-360 is continuing to monitor the situation and will publish updates as necessary.

To learn more about Guar gum go to http://www.guargum.biz/index.html
 

 

  

Hydrochloric Acid Shortage Minimize
Update: The Hydrochloric Acid shortage continues and inventories are not expected to recover until the third quarter of 2012. Prices are likely to remain on the higher end through the first half of 2012. However major distributers assure constant supply in the short to medium term due to high inventory levels.

Rx-360 has partnered with Beroe to publish a report that contains a detailed analysis of the Hydrochloric Acid Supply Chain. 

To view of download the report, click here.

 

Hydrochloric acid may be manufactured by several different processes, although over 90 percent of the Hydrochloric Acid produced in the U. S. is a byproduct of a chlorination reaction.  It seems the shortage is a result of decrease production and increasing demand. 

The slowing of the economy has decreased production leading to fewer chlorination byproducts, and a significant increase in demand from the oil and gas industry has resulted in a shortage of Hydrochloric Acid.  Large quantities of Technical Grade Hydrochloric Acid  (25% of the US supply) is now used in hydraulic “fracking”, and the use of "fracking" is expected to grown in popularity.

Man-made Hydraulic fracturing or fracking is the propagation of fractures in a rock layer caused by the presence of a pressurized fluid to release petroleum, natural gas, coal seam gas, or other substances for extraction.

The energy from the injection of a highly-pressurized fluid, such as water, creates new channels in the rock which can increase the extraction rates and ultimate recovery of fossil fuels. The fracture width is typically maintained after the injection by introducing a proppant into the injected fluid. Proppant is a material, such as grains of sand, ceramic, or other particulates, that prevent the fractures from closing when the injection is stopped.

The shortage has occurred with Technical Grade Hydrochloric Acid. The tight supply of Technical Grade Hydrochloric Acid, and the steady demand from the oil and gas industry is beginning to impact supply of High Purity Hydrochloric Acid.
 

Several suppliers have reported that they are being allocated Hydrochloric Acid, and in turn are allocating Hydrochloric Acid to their customers.  There have also been reports of recent specification failures of Hydrochloric Acid at incoming inspection.  

Firms who use Hydrochloric Acid should consider taking the following actions: 

1. Contact your supplier of Hydrochloric Acid and assure their ability to supply

 

2. Assess and understand the Hydrochloric Acid supply chain for vulnerabilities that could cause supply interruptions and product authentication concerns

 

3. Secure a supply of Hydrochloric Acid from a trusted supplier

 

4. Conduct full analytical testing upon receipt of Hydrochloric Acid

Rx-360 is continuing to monitor the situation and will publish updates as necessary.  

  

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