IChemE Education Subject Group - Resources
Chemicals, Utilities and Materials Cost Guide 2001
FOR EDUCATIONAL USE ONLY
The following pages give costs of common process utilities, bulk chemicals
and materials of construction for use by staff and students in educational
institutions for economic calculations. They are not intended for any other
purpose and do not imply that materials will be available from any supplier
at that price. Having said the above, it is hoped that this information
will be of use in giving students a rough but realistic idea of costs,
and will enable academics to give examples and projects which are at least
plausible. We will be pleased to receive suggestions of additions and corrections
from knowledgeable parties. This document is copyright the Institution
of Chemical Engineers, but may be freely quoted and linked providing due
acknowledgment is given.
Costs of bulk chemicals in 20-tonne loads
in the UK or European home market
Costs of utilities and other process variable
costs
Costs of materials of construction of chemical
plant equipment
Cost estimates for
items of process equipment by Matches
A note on costs
The price for a commodity or service is dependent upon the market conditions
and the situation of both the supplier and buyer as well as the cost of
production. Many chemicals are interrelated in the market place. For example
chlorine is produced along with sodium hydroxide from sodium chloride.
Increased demand for one will increase the availability of the other and
possibly reduce its price. Some materials are used in several different
manufacturing processes. Increased demand for one end product is liable
to pull up the cost to all users. Conversely, new plant to satisfy this
particular demand may produce greater quantities and lower prices for all
users. Buyers and suppliers often enter into contracts which fix or control
the price over several years, and this may be significantly above or below
the fluctuating market price for single purchases. Companies transferring
material internally (e.g. from a refinery to an adjacent chemical plant)
can often do so at a lower cost than the general market price.
Please note that purity is not the same as quality. A material of 96%
purity but without a particular contaminant (such as a catalyst poison)
may be more expensive than the same chemical of 98% purity but having 200
ppm of that contaminant. In some cases, the particle size distribution
(so that a solid flows well and disperses or dissolves quickly) may be
important and command a premium price for meeting the handling specifications.
There is commonly a cost difference of at least a factor of 2 between
different markets for the same material, often more. Generally material
in its home market (i.e. the country where it is produced) will be cheaper
than the same material imported a great distance, so the economics of process
plant are often dependent on location. The same process may be profitable
in one country but not in another. Where a process makes use of a byproduct
or waste, then the raw material cost can be as low as zero or even negative
(i.e. the price you do not pay to dispose of the waste). However, the rate
of the process may then be tied to the source of the byproduct or waste.
This page maintained by Martin Pitt, e-mail: M.J.Pitt@sheffield.ac.uk
Last updated 23 October 2001
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