What Are the Major Wax Markets?

In North America the consumption of wax is approximately 3 billion pounds per year. There are two major market categories: packaging materials and all others. Packaging represents only 30% of the market, but most people still think of wax as primarily a packaging material. Thirty years ago, with waxed paper, milk cartons, paper drinking cups, etc., this impression might have been true. However, innovative uses have been found for wax in recent years.

Click here to view a chart of North American Wax Consumption

Markets for wax are diverse.

Building Materials: wax is added as a water repellent in the production of wood-based manufactured composite boards such as particle board, medium density, oriented strand and other board products.

Candles: one of the oldest uses of wax, but still vital. No longer used for primary illumination, candles are the fastest growing segment of the wax market with new decorative and therapeutic uses.

Chlorinated paraffins: chemicals manufactured by chlorination of paraffin waxes. The largest application for chlorinated paraffins is as a plasticiser and flame-retardant in flexible PVC. They are also used as plasticisers in paint, sealants and adhesives. The higher chlorine content grades are used as flame-retardants in a wide range of rubber and polymer systems. Another major outlet for chlorinated paraffins is in the formulation of metalworking lubricants where they have long been recognized as one of the most effective additives for lubricants used in a wide range of machining and engineering operations. Finally, they are used in leather formulations.

Corrugated Board: wax is applied to corrugated containers in order to provide wet and top to bottom strength, key concerns in food packaging.

Coatings: wax can be used to form a coating that allows oxygen to pass but not water; generating numerous applications in such diverse areas as cosmetics, food, packaging, furniture, time release properties, etc.

Cosmetics: fully-refined wax is non-toxic, and many products are approved by the FDA for direct use in food and personal care formulations. Waxes are widely used in the cosmetic industry in products such as lipstick, mascara, moisturizing creams and sunblocks.

Chewing gum: chewing gum base is a compound of elastomers, resin and FDA wax to which other materials are added to produce chewing gum. Hard, high melt-point waxes are used in this application, including microcrystalline and candelilla waxes.

Crayons: FDA wax provides the solid structure for a crayon and, since most crayon users are young children, its non-toxic characteristics are critical.

Firelogs: a modern convenience product, wax acts as both a binder and as fuel.

Food: FDA wax is used to cover certain types of cheese that would dehydrate if not properly protected, is sprayed on citrus and other fruit to protect from oxidation and enhance appearance, and in meat/bone wraps.

Hot melt adhesives: waxes are present in most hot melt adhesive formulations, where they control the viscosity of the adhesive and contribute to open time, flexibility and elongation.

Inks: graphical printing inks include wax in their formulation to make them brighter and to improve sliding capabilities, as well as to prevent scratches that affect some printing inks.

Investment casting: in the "lost wax" method of casting of jewelry, industrial products, etc. a wax model of the piece is made, then used to create a clay mold. The wax is melted out, and the clay used to cast the final piece.

Polishes: the application of waxes to wooden floors to improve their appearance and provide protection dates back several hundred years. The application of wax retards the penetration of air and moisture, thereby increasing the life of the flooring material as well as preventing abrasion by surface grit.

PVC: two different lubricants are used in the manufacture of polyvinyl chloride thermoplastic: internal and external. Two different types of wax are used in the lubricants. Internal lubricants are formulated to help PVC flow in the manufacturing process; they form a solution with PVC. External lubricants are not soluble in PVC and they produce a film between the PVC and its extrusion equipment.

Tire and Rubber: wax is a vital component in rubber tire formulations; it is added for protection from atmospheric ozone that will "dry" unprotected rubber, causing cracking that compromises the strength of the tire. Wax creates a physical barrier between the tire surface and the atmosphere.

The biggest single consumer of wax in North America remains the packaging area; the next biggest (and fastest growing) segment is candles, followed by building materials and then firelogs.

Click here to view U.S. Wax Production Data

In recent years US production of wax has suffered becasue several small base oil plants have shut down and another large plant converted from MEK dewaxing process to wax hydroisomerization technology. These changes stem from a move towards the manufacture higher quality Group II base oils. Today, there are 12 US wax producers.

American Wax Producers

Source: NPRA

In North America, fifteen companies currently manufacture finished or semi-refined waxes at 17 locations in North America; not all companies produce both semi-refined and fully refined waxes. Product distribution is about 50/50 between finished and semi-refined, though this can be misleading because semi-refined is sold as feedstock to fully-refined producers as well as being sold into end-use markets

A typical wax producer in North America produces wax concurrently with base oils at an integrated solvent dewaxing/deoiling unit, although there are also "stand-alone" deoiling plants producing finished wax from purchased feedstocks. An average finished wax plant produces about 1,000 barrels a day of product, or 100MM# a year. About half of US wax manufacturers produce low oil content, finished waxes, the rest simply recover slack wax from their operations. One producer sells residual material from waxy crude without further processing. Curiously, no integrated Canadian refiner produces finished wax, nor do most of the Caribbean plants. North American producers operate only solvent deoiling processes. There are other technologies available for deoiling, including sweating and fractional crystallization; the latter process is the only practical alternate for large scale production. After deoiling, product wax is typically finished by hydrogenation or clay treating to decolorize it and assure FDA performance where required.

Click here to view U.S. Wax Import & Export Data

A reduction in capacity for wax production in North America has drawn increased import of raw and finished waxes. EIA data for the period 1992 - 2002 show an increase from about 170 MM# per annum to 270 MM#, or roughly 14% of domestic production in 2002. International Trade Agency (ITA) statistics, however, tell a somewhat different tale: ITA shows low imports in the early '90's with a steep change to about 250 MM#/year in the last half of the decade and continued growth to about 344 MM#/yr estimated for 2002. This chart reinforces one of the problems inherent to the wax business: with so many sources and classifications of product, it's easy to find conflicting data. EIA statistics are based on self-reporting within the relatively small community of producers, so they probably represent their business well; the ITA numbers are subject to classification by tariff codes, etc. and are probably more subject to confusion. This paper takes the higher number as the correct one, assuming that it is easy to miss itemized imports because of the multiple tariff classes. The data do lead to consistent conclusions: that there is an ample world supply of wax; and that US imports have increased sharply in recent years.

U.S. Imports for Consumption, 2001

Source: International Trade Agency

Petroleum wax far outweighs all other sources by volume. But the data must be approached with caution, since, for example, the table shows a trade in feedstocks with Saudi Arabia and Iraq. It is obvious that there are misclassifications of imported products.

Click here to view a chart of U.S. Base Oil Manufacture

ASTM/IP Standards Applicable to Petroleum Waxes

Source: ASTM Significance of Tests