RICK MULLIN, C&EN NORTHEAST NEWS BUREAU

Every specialty chemicals market has its workhorse materials--chemicals such as resins, solvents, or builders that ride the border between specialty and commodity. In water treatment, these materials are generally found in the filter.

	AROUND THE CLOCK The power market's need for pure water creates a surging market for filtration media.

Most water treatment applications involve a filtration step in which chemical media or membrane filters remove minerals, contaminants, and organic material from a water source or stream. The chemicals involved are distinct from other water treatment chemicals in that they are not consumed in the process.

Water treatment filter media are usually ion-exchange resins or activated carbon. Ion-exchange resins are typically styrene and divinylbenzene copolymers cross-linked to form beads between 0.03 and 1.0 mm. The beads are converted into cation-exchange resins through a sulfonation process, or anion-exchange resins through chloromethylation.

Ion-exchange resins, which pick up positively or negatively charged particles in the water stream, are employed in systems with two towers that alternate between water processing and resin regeneration. In the regeneration cycle, salt or acid is added to effect a reverse ionic exchange, thus removing the contaminants and preparing the resin for reuse.

Activated carbon absorbs toxic organic material that cannot be removed with ion-exchange resins. The carbon, however, must be removed and the contaminants burned off to prepare it for reuse.

Ion-exchange resins and activated carbon are often used in tandem, sometimes in conjunction with membrane filtration. Most membrane systems employ polyamide filters through which water is passed under pressure to remove particulates.

The market for nonconsumable water treatment chemicals is under pressure from the economic downturn, and the business is characterized by stiff competition among a handful of major global suppliers. However, there are growth markets, especially for membrane filtration systems, driven by sustainable development efforts around the world and advances in product development.

Ion-exchange resins are viewed as the true commodity corner in water treatment. There is not much of a market for services for the resins, as there is for activated carbon, so suppliers generally compete on price and production cost efficiency.

"This sector really suffers from the tendency of specialty chemicals to behave like commodities," says Ray Will, a specialty chemicals consultant with SRI Consulting. "Ion-exchange resins are kind of a black box. Customers don't care how they do the job; they just want the job done. It's a tough market where you really have to worry about being the low-price supplier."

Prices for ion-exchange resins in the U.S. market have remained stable over the past three years following a dip through the 1990s, sources say. Prices now average between $0.54 and $1.00 per lb for cationic resins, and between $1.55 and $2.05 per lb for anionic resins, according to Will. "With $1.00 per lb as the basic definition of a commodity, you can see that cationic resins especially are getting clobbered."

 HOWEVER, there is a high-end segment in the category composed of premium products that are often custom manufactured. Leading companies seek to boost profits by pursuing opportunities to manufacture to customers' specifications and by developing products targeted for growth markets.

The top vendors--Rohm and Haas, with a 32% market share, and Purolite, with a 27% share, according to SRI--have focused on lowering the cost of production with plants in China and Romania, respectively. Dow Chemical, with 11% of the market according to SRI, credits its Six Sigma quality manufacturing regime with keeping its U.S. and German manufacturing plants cost-competitive.

Purolite is on target to meet its sales projections for 2002, thanks to growth in the residential water-softening market and success of new technologies, says James Sabzali, North American sales and marketing manager. The privately held firm, with annual revenues of $150 million, claims a heavy emphasis on research and development of new resins. Purolite's four-year-old shallow-shell resin technology, Sabzali says, has achieved steady growth in residential water-softening and in industrial water-softening and demineralization.

The SST-60 shallow-shell resin employs beads of various sizes but with a uniform depth of functionality around a nonfunctionalized core. This, according to Sabzali, optimizes the efficiency of each resin bead, in turn improving the performance of a resin bed. Purolite sells the SST-60 resin at a 30 to 40% price premium.

Sabzali says Purolite focuses on developing products that are selective for targeted ions, but he acknowledges that, by volume, most of the resins the company sells are price-driven and commodity-like in nature. To compete, Purolite has keyed on low-cost manufacturing at four plants around the world: Victoria, Romania; Pontyclun, Wales; Hangzhou, China; and Philadelphia.

Rohm and Haas has spent the past three years developing advanced-technology ion-exchange resins for power generation, semiconductor manufacturing, and other industrial applications, according to Jacques M. Croisetière, business director for ion-exchange resins and Rohm and Haas's European regional director.

Rohm and Haas sees 7% annual growth in the power generation market, where it recently introduced a new product called PowerResin. "In the nuclear industry, reactor generation and steam generation are effectively controlled by ion-exchange resins," says Ian Burke, global business manager for Rohm and Haas. "The key index is asset utilization--power producers need to run the plants all the time."

	Croisetière	Richey
	ROHM AND HAAS PHOTO	BAYER PHOTO

THIS REQUIRES strict control of water purity, he says. "The new resins can bring the level of sulfates in steam generation, for example, down to very low levels." Burke claims that Rohm and Haas has increased its market share in power generation from 20% to 70% over three years.

Sustainable development efforts around the world have also generated a growing market for ion exchange in water treatment. "The best potable water sources are already used," Burke says, "and the old civil engineering methods of treating the more contaminated water sources are becoming less effective. The industry is turning to a chemical treatment approach. We think this is a major opportunity."

The main removal targets are boron, trihalomethane, and perchlorates, Croisetière says. Perchlorate removal has become a major issue in California, where much of the water table is contaminated owing to industrial pollution.

Bayer--with an 8% market share, according to SRI--has been leaning on its expertise in manufacturing resins of uniform particle size, which have the advantage in large power plant applications of allowing for the processing of greater volumes of water, says Jay W. Richey, vice president and general manager of the company's Sybron Chemical Division, which Bayer acquired for $325 million in 2000. Before acquiring Sybron, Bayer commissioned a commercial-scale facility for uniform particle resins in Bitterfeld, Germany, in 1999, Richey says.

Richey, whose division is in charge of North American sales, says the economy is taking its toll this year. "In the industrial market, anything having to do with capital investment is going to be off," he says. Customers are delaying new projects and putting off recharging existing systems. Sales to industrial users are off 20% this year, he says, and residential sales will be flat. Richey, however, sees highly selective ion-exchange resins for chlorate and nitrate removal as a growth patch in municipal water treatment, especially in California, as state and federal legislation tightens.

Dow, which markets both ion-exchange resins and membrane-filter technologies, has seen a retrenchment in traditional residential, commercial, and industrial ion-exchange resin markets, says Alan Greenberg, North American marketing manager for resins. But there are growth markets as well, including wastewater remediation. "I would hesitate to call them niches because these applications are huge," Greenberg says. Resin selectivity is being turned on perchlorates, tannic acid, boron, and radium for environmental remediation, he says.

Resins are also being applied in tandem with reverse-osmosis membrane filtration, according to Greenberg. "Reverse osmosis will often remove up to 99% of a contaminant," he says. "Ion exchange can be added as a polishing step" in applications where contaminants and elements must be removed completely.

Complete removal is a growing criterion, he says. In California, for example, the acceptable levels of perchlorate will soon drop to zero. "In environmental remediation, it's all polish," he says. Reclamation of precious metals such as cobalt, nickel, copper, uranium, and gold from mining streams and other waste streams is another growth patch, Greenberg says.

Activated carbon is the primary filter media for removal of organic contaminants, according to Jim Cederna, chairman and CEO of Calgon Carbon, the leading supplier of activated carbon to the water treatment market. Unlike resins, carbon has a service component--the removal and regeneration of used carbon.

Calgon, however, incorporates ion-exchange resins in mixed media systems, according to Cederna. Water treatment system design is a key focus at Calgon, which for the past two years has been marketing systems that incorporate ultraviolet light to disinfect drinking water. Calgon has patents on a UV system that breaks down the DNA in microorganisms, rendering them harmless, Cederna says.

Membrane-film manufacturers are reporting significantly more robust growth than are makers of filter media because of major new applications and advances in materials performance. Dow, which manufactures reverse-osmosis and nanofiltration membrane filters in its Filmtec division, recently introduced a low-energy membrane for reverse osmosis, says John Goodman, marketing manager.

The company has worked to scale up application of its FT30 polyamide membrane, developed 25 years ago, initially for seawater desalinization applications, for municipal and industrial use. The membrane, which originally operated at a pressure of 225 lb per sq in, can now be used at 100 psi, Goodman says. The new XLE-440 low-pressure/low-energy membranes reduce not only operating costs compared with the FT30, but also system costs, because fewer or smaller pumps and motors are needed, he notes.

Increased salt rejection is another development target for membranes with a major growth application market--seawater desalinization. Major plants are already operating in the Middle East and Spain, and large plants are planned in California and in Florida, where a 25 million-gal-per-day facility is nearing completion in Tampa Bay. Globally, volume sales for membranes are increasing at about 15%, Goodman says.

USFilter, a supplier of reverse-osmosis membrane filtration and microfiltration systems, is keying on the municipal market, which Bob McCarthy, vice president of sales, says is surging owing to tighter federal controls on contaminants. The Environmental Protection Agency's recent addition of Cryptosporidium to the list of bacteria and microbes that must be removed from drinking water has been a boom for microfiltration, McCarthy says.

USFilter this year debuted a polyvinylidene difluoride microfiltration membrane for municipal waste treatment that is being used at a new plant in Monroe, Ga., McCarthy says.

General Electric recently announced plans to purchase another major membrane producer, Osmonics, for $270 million. The company says it will combine Osmonics with its water technology division, formed in 1999 with the purchase of Glegg Water. This would effectively triple the size of the water technology division, according to GE.

In its water technology unit, GE now manufactures and supplies continuous electronic deionization (CEDI) systems--ion-exchange resin technology that uses electricity to continuously recharge resins, eliminating the time, materials, and operating costs involved with running alternate treatment and recharge cycles in standard ion-exchange resin systems.

Industry watchers say CEDI currently accounts for less than 5% of the total market for ion exchange.

The advent of the new technology is viewed as a minor threat and a possible opportunity by resin makers, who are used to selling products to designers of systems that mix resins, carbon, and filters. Dow's Greenberg says CEDI, which is also marketed by USFilter, is a viable technology for high-purity filtration that produces no chemical effluent. It is a competitive threat, he says, but one that fits well within the technologically symbiotic water filtration market. In short, "We'll sell them the resins," Greenberg says.

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