Benzene, an aromatic hydrocarbon, is currently witnessing a price rise globally with the rising price of crude oil. Primarliy used in the manufacture of caprolactum and linear alkyl benzene (LAB), benzene has been pushing up manufacturing costs for soap and detergent companies in the last few months.
These manufacturers have been facing reduced margins of over 50 per cent owing to a near 100 per cent increase in benzene prices. From nearly the beginning of 2002 (February) prices have gone up from Rs 12,000 per tonne to over Rs 22000 per tonne, for benzene.
LAB is a component of laundry detergents and other cleaning products. An environmentally safe product, it is used by many companies around the world. Consumption has been increasing every year owing to consumer acceptance.
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LAB is also used to produce linear alkyl sulphonites (LAS), derived from petroleum by-products benzene and paraffins derived from kerosene. LAB currently represents one-third of the active ingredients in detergents worldwide. This increase in its raw material prices is bound to affect prices of detergents and house and floor cleaning solution.
Says an FMCG analyst