Helium shortage means change to some industries
June 21, 2012 at 1:21 a.m.
A nationwide helium shortage has regional industries adjusting business practices to sidestep deflation.
The shortage, which began in late 2011, boils down to supply and demand, said Leslie Theiss, field manager of helium operations at the United States Bureau of Land Management's Amarillo office.
Helium is limited in supply, she said, and lower production at some overseas plants also contributes to the shortage.
"There isn't enough molecules to go around," Theiss said.
The Cliffside Gas Field, just outside Amarillo, is the only federal supplier, and one of two major plants nationwide. Theiss said it produces about 42 percent of the nation's supply, and about one-third of the world's helium.
There, she said, the plant supplies the crude helium, while refiners process and purify the gas. They then supply the product to others.
"We're kind of the first stop," she explained. "We produce what we can for them. Then, if they don't get what they need, they allocate to their customers."
Victoria's AOC Welding Supply Co. began feeling the pinch about three months ago, when the company's helium allocation took a hit, said Marilyn Dufrene, AOC's regional manager.
At the time, the amount of the gas AOC could purchase from suppliers dropped to 88 percent of the previous year's allowance. Shortly after, it dropped further to 50 percent.
Dufrene declined to give exact amounts.
Adding to the distress, she said, was the fact that AOC's local competitor ceased supplying commercial helium in the Crossroads.
"Yes," she said. "There is a shortage."
Dufrene said the company is doing what it can to work through the change.
Customers now see the same type of allocation as AOC, she said, explaining that those who typically purchased two to three cylinders per week cut back. The business is no longer taking on new customers, she added, and is working to find regulators and different gases that might allow clients to do the same work with less helium.
"At this particular time, we are trying to think outside of the box," she said.
Other Crossroads companies said they felt the effects, but to a lesser extent.
The shortage made it more important for the staff at Victoria's Card and Party Factory to plan ahead, said Louie Miller, the store's manager. He said the company's corporate office sent out notices explaining the situation and what it meant.
In the letter dated May 18, the company noted it changed the mixture that went into balloons. While it used to be 100 percent helium, it's down to 60 percent helium, along with another additive.
Victoria's H-E-B floral departments also received memos alerting them to the rising prices, said Regina Garcia, the company's regional director of public affairs. The notice went out in January, she said, to assist with budgeting.
The helium price increase had a nominal impact on Expressions Floral & Gifts, where flowers and plants are bigger sellers than balloons, said Holly Weber, the business' office manager.
Fuel surcharges and similar issues made a bigger difference, she said, but the helium issue is like anything else.
"It's all supply and demand and a matter of Mother Nature," Weber explained. "It's no different than South America being hit by flooding and affecting the rose crops."
Although helium is often used in the medical field for MRIs, representatives with both Victoria Upright MRI and Crossroads MRI said they escaped any negative impacts.
Looking forward, Theiss said she expected the shortage to continue through maybe the end of 2013. New sources will likely be available by then, she said, which should ease some pressure.
As for the staff at AOC, Dufrene said they were confident the situation would improve. In the meantime, she said, the company encouraged customers to use the gas wisely.
"It's certainly time for customers to try to conserve," she said. "And realize it's not that we don't want to sell it to you. When the supplier's on allocation, and you're on allocations, business is not as usual."