Issue Date: December 7, 2015
Why Chemical Makers Have Their Eyes On Formic Acid
Held together by only one carbon atom, formic acid is the simplest carboxylic acid. The market for this chemical is relatively small as well—a fraction of the demand for organic acids such as two-carbon acetic acid.
Because the market is modest, only a handful of companies make the molecule. In fact, the U.S. had been without a formic acid plant until a month ago, when BASF started manufacturing the chemical at its complex in Geismar, La.
But formic acid might not be relegated to obscurity for long. Demand for the compound is growing because of its nontoxic and noncorrosive qualities. It is finding use in applications as varied as feed silos and oil wells. It might even be of assistance in alternative energy. Because of formic acid’s potential, BASF and other chemical producers are plunging deeper into the business.
Formic acid has long been well-known in the insect world. Many species of ants find it convenient to carry the stuff in their abdomens to spray at intruders, neutralize venom, and clear pests off their patch of garden. The name of the chemical even comes from the Latin word for ant, formica.
Humans put formic acid to a variety of uses, the largest of which is leather tanning, according to Sriram Mohan, industry manager for chemicals at the market research firm Technavio.
Following closely behind tanning is agriculture. Farmers apply formic acid to hay and other animal feeds as a preservative for long-term storage in silos. They also use it to kill mites, an application, Mohan points out, that isn’t unlike what ants use it for.
About 675,000 metric tons—$680 million worth—of formic acid was consumed globally last year, according to Technavio.
Agriculture is the fastest-growing market for formic acid, with about 6.5% annual growth, Mohan says. The acid is both benefiting from the growth of agriculture generally and enjoying widening use in the sector.
Mohan forecasts the entire market for formic acid will grow at a healthy 5.6% annual clip through 2019.
BASF hopes to capitalize on the robust outlook with its new plant, which opened last month with more than 50,000 metric tons per year of capacity.
BASF is far and away the world’s largest formic acid producer. In addition to Geismar, it has plants in Ludwigshafen, Germany, and Nanjing, China, that boast a combined 255,000 metric tons of capacity.
The Geismar plant is the first the U.S. has seen since 2009, when Celanese closed its Pampa, Texas, facility, which made formic acid as a coproduct of acetic acid production. BASF marketed the output. The BASF plant, in contrast, combines carbon monoxide and methanol into methyl formate, which is then reacted with water to make formic acid and methanol.
The new plant serves North and South America, where BASF sees a lot of opportunity for the chemical. The oil and gas industry, which adds formate salts to drilling fluids to make them heavier, is a strong market in North America.
BASF also sees North America as a fertile ground for emerging applications. One example is deicing airport runways with potassium formate. The chemical may be environmentally preferable to deicers based on potassium acetate because it’s digested more readily in wastewater treatment facilities.
“European airports have been using potassium formate runway deicers for over a decade, but the North American market has yet to benefit,” a BASF spokesman says.
The new plant isn’t the only change to the formic acid supply lineup recently. In 2014, the amines specialist Taminco paid $190 million for Kemira’s formic acid business, which included a plant in Oulu, Finland. Later that year, Eastman Chemical purchased Taminco.
At the time of the formic acid deal, Taminco Chief Executive Officer Laurent Lenoir told investors that the business serves “markets that are benefiting from megatrends.”
Also aiming to break into formic acid is the British Columbia-based start-up Mantra Energy Alternatives, which owns a technology invented by Colin Oloman, a professor of chemical engineering at the University of British Columbia. Oloman developed an electrochemical process that reduces carbon dioxide using water. Oxygen forms at the anode and formate salts at the cathode.
A few challenges remain in getting the process off the ground, notes Sona Kazemi, Mantra’s chief technology officer. One is the low solubility of carbon dioxide in water, which limits the throughput of the process. The company is seeking funds to build a pilot facility next to a cement factory in Richmond, British Columbia, that will supply CO2 emitted from its kiln.
Instead of aiming at conventional markets, Kazemi says, Mantra wants to establish formic acid as a direct fuel for fuel cells and for hydrogen storage. Kazemi points out that formic acid is safer and more convenient than highly pressurized hydrogen gas.
Kazemi envisions an integrated process where renewable power runs the electrochemical process, which creates formic acid as a way to store energy for later use in the fuel cell. “These two together provide a nice energy loop,” she says.
Mantra might not be alone. BASF says it also has its eye on formic acid for fuel cells. The application is potentially another use for the already useful chemical.
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