Friday, May 19, 2017

ePTFE Membranes – The Possibilities are Endless

It doesn’t require a scientist or an engineer to take a basic property of a material and extrapolate the possible areas of application.

We have spent the last one year developing ePTFE membranes, as we saw it as a key growth area within the PTFE space. As a technology, it remains obscure. Yet the demand for this product is so vast that it is no wonder that the few companies that have perfected it have been able to command the market (and by extension, the price).

To say that we have perfected ePTFE membranes would still be an overstatement. Being an SME, we have had to focus our R&D in those areas where clients have shown interest, rather than take a broader approach and simultaneously develop multiple variants. However, in our pursuit of client satisfaction, there have been consistent findings that have slowly allowed us to start tapping into the broader demand in the market. In addition to this, what we know about the property of the material gives us insights into other, perhaps less explored areas of application.

To start with, let us lay out the most fundamental property of this material:

ePTFE membranes allow gases and vapours to pass, while restricting liquids

This ability is what lays the foundation for the myriad applications (and potential applications) of ePTFE membranes. When coupled with the other properties of PTFE – such as temperature resistance, chemical inertness and dielectric strength – it is easy to see why the product is so much in demand.
  1. ePTFE Membranes in Automotive Vent Applications

    Auto is a well traversed industry for ePTFE usage. We started our development of ePTFE membranes when we were asked to replicate an automotive vent as manufactured by Gore. The vent is a small disk of ePTFE membrane, with an adhesive backing. We were able to develop it in both virgin form and with a carbon filling.The purpose of this vent is to sit on a small opening at the back of the headlamp chamber. Any moisture that could potentially fog the headlights and/or condense within the chamber is released via the vent. However, as the vent is only permeable to gases and not liquids, water is no allowed back into the headlamp chamber, keeping it free from moisture.

    automotive vent
  2. ePTFE Membranes in PCB applications

    The effect of moisture on PCBs is well known. Apart from rust and corrosion, the presence of excess moisture can cause multiple short circuits, destroying the device within which the PCB is operating.ePTFE membranes are ideal in allowing any moisture built up within the PCB assembly to escape. At the same time, in the event of direct exposure to liquids, the ePTFE membrane shields the PCB, keeping it dry.
    The usefulness of this application is seen in nearly every industry where electronics are used. With mobility becoming more important, the chance of exposing a device to moisture becomes nearly unavoidable (think, dropping your smartphone into water). Having the protection of a breathable ePTFE membrane means the device is less likely to fail in such an event.
    eptfe pcb
  3. ePTFE Membranes in Cable Wrapping

    We have covered this in an earlier post. However, it is useful to reiterate that the high dielectric capabilities of ePTFE drive its use as a cable wrapping medium.ePTFE insulator tape can be made with tightly controlled thicknesses of as little as 0.05mm, with a uniform density, and dielectric constant. Wrapping individual conductors in ePTFE can cut interference, noise, cross-talk, and signal attenuation. In some applications, ePTFE tape helps limit phase shift to 4.3° and signal attenuation to 0.05 dB at 110 GHz.
    ePTFE Cable
  4. ePTFE Membranes in Filtration

    Multiple applications within filtration exist for the use of ePTFE. Filtration itself requires different levels of porosity and pore size and the membrane needs to be customised accordingly.

    One of the most commonly known filters is used in vacuum pumps. It consists of a single ePTFE layer, moulded into a polypropylene housing (see below).
    eptfe filter
  5. ePTFE Membranes in Desalination

    We believe this may be a huge growth area going forward. Desalination is an expensive process currently. An ePTFE layer could be used to allow for evaporated vapours from a salt water reservoir to pass through it and into an upper chamber. Consequently, it would prevent the condensed liquid from re-entering the salt water reservoir. In this manner, the water is separated from the salt using only solar energy. Spread over a wide enough area, this could effectively trap evaporating sea water to convert to fresh water.
We expect to continue adding to this list as more uses of ePTFE membrane become apparent. One thing we do know is that is a material of the future and that being able to modify and customise its texture and form would be a key proprietary skill going forward.

Tuesday, May 9, 2017

PTFE Pricing – Is volatility making a comeback?

An introduction to PTFE Pricing

Being a niche industry, PTFE doesn’t exactly get a lot of press even when large shock waves surge through it, disrupting the operations of manufacturers and end-users alike.

In 2010-11, the price of virgin PTFE began climbing, after having dipped consistently over the preceding 5 years. What started out as an understandable correction soon turned into an all-out crisis, as the price nearly quintupled over the next 8-10 months.

Imagine that scenario in any other industry. If the steel price to see a 5x increase in less than a year, what horrors would that unleash into the broader market? That the PTFE industry survived is a testament to the incredible properties of the material, that make it so difficult to substitute using other polymers.

To make matters worse, since the industry is small, there was no one to really make sense of the economic factors driving the price increases.

We stepped in at that time, partly driven by our own need to analyse the situation, but also because the information we collected seemed like it would be useful to other industry players.

Many articles were released between 2011 and 2013 that charted the various drivers of PTFE pricing and made sense of the driver that would play out going forward.

Over the past few months, there have been murmurs of a return to the high pricing seen in 2011. Resin suppliers have offered ample warning that a price revision was imminent. So far, this has translated into 2 price corrections to the extent of 10-15% and 8-10% in the months of April and May respectively.

We need to compare this with the escalations seen in 2011-12 and understand that the rise is not quite so sharp. Nonetheless, we also need to compare the cost drivers and ensure that the same pattern is not repeating.

Key Drivers of PTFE Price

Unlike other polymers – such as polythene, polypropylene and polycarbonates, PTFE does not result as a by-product of the oil refining process. This comes as a shock to many, who assume that our fates are tied to oil prices and that we should therefore be benchmarking our final rates accordingly.

PTFE is made from the polymerisation of R22 gas – a refrigerant that finds its use mainly in the air conditioning and refrigerator industries. As a result, PTFE prices are driven by the demand and supply of R22.

When prices started increasing in 2011, the key driver was thought to be Fluorspar – a mineral that is critical to the manufacture of R22. In conjunction with this, a spike in demand from the AC and refrigerator markets in China along with a general crackdown on R22 usage (as it is not an environmentally friendly gas) caused prices to shoot up.

Today, the scenario is slightly different.

For one – we’re over halfway through the summer, so we’re not likely to see any shocks due to AC and refrigerator demand. Furthermore, Fluorspar supply has also regularised. A key effect of the price increase in 2011 was that idle Fluorspar mines in South Africa were reopened, offering an easing of supply to the market that was otherwise dominated by China.

If industry insiders are to be believed, the key driver this time around is environmental. China has been actively seeking to clamp down on R22 usage and has, in the process, shut down two PTFE plants that were not adhering to the standards. It is from here than the supply constraint has originated, driving up PTFE raw material prices within China. Obviously, as the China price is usually the floor price for most goods in the world, this has allowed resin manufacturers around the world to increase rates accordingly.
Where the prices go from here depend on three factors:
  1. Whether the shut-down plants will be coming back on line after making the necessary changes

    It is yet unclear if the plants have been permanently shut down or are only undergoing an overhaul to make them compliant with the environmental codes. If they do come back online within the next 6-8 months, we would see a return to lower prices
  2. Whether the move to phase out R22 will go as scheduled

    R22 is being phased out not only in China, but all over the world. India has also committed to stop using the gas completely by 2032. If this phase out continues, it could result in a supply surplus to the PTFE industry, driving down prices. However, if the use of R22 in PTFE is itself restricted, then it would require a shift to alternatives of R22, which would be

    expensive.Currently, as there is no talk of restricting R22 in PTFE specifically, it is likely that the former would result
  3. Price inelasticity of PTFE

    In 2011, one thing that was made clear was that even at 5x multiples, there was still demand for PTFE resins. This allowed the resin manufacturers to continue increasing prices well above the rates that would have resulted from purely economic factors.
Ultimately, it was due to competition from China that forced prices back to normal levels.
In the short term, it is likely that resin suppliers will again try and test the market to see what levels they can sustain at. With the threat of China temporality removed, it remains to be seen how far they will push the market.
We only have snippets of information at this point to make sense of the situation. Clearly, with PTFE being used in so many fields, this poses some concern to many industries. We will be keeping our ears to the ground to see if anything else come up.