Quarterly Update on Global Bulk Helium Market
For the Quarter Ending June 2021
Global Helium shortage surged the prices in North America during this timeframe, as the demand remained consistently firm throughout the quarter. Post recovery from Covid pandemic, regional end users expected an improvement in the supply activities, which never happened in this quarter. However, more than 10% shortage in supplies was observed from the medical, laboratory and semiconductor segment during this timeframe. In addition, traders are expecting that, on the back of supply shortage, there will be another boom in prices in forthcoming months.
Asian imports for Helium remained consistently firm throughout the quarter backed by firm demand from downstream medical and laboratory segments. In the Indian market, most of the cargoes were received from USA. Therefore, amidst critical shortage and firm demand, prices of Helium rose effectively during Q2 2021, across Asia. Asia is an ever-growing market, where the demand for Helium is increasing every year. Global shortage has been providing opportunity for Canada to expand their business across the APAC region.
During Q2 2021, Helium prices in Europe moved in line with the international prices. Prices improved aggressively across the region, despite of having own sources of Helium unlike in Asia. In the meantime, Russia launched the first line of its Amur Gas Processing Plant, which is the one among the total six lines, having a huge potential to extract LNG and Helium. In addition, Russian manufacturers were already aware of the fact that their Helium production level is much lower than that of USA and Qatar, therefore, Russia based companies like Amur planned to expand its capacity to divert some of the demand from USA and Middle East to Europe.
For the Quarter Ending March 2021
In North America, severe shortage of Helium was observed during Q1 2021. As a consequence of the winter storm across the USA gulf coast several plants went through an unplanned shutdown. BLM (Bureau of Land Management) had shut down its Texas based Helium enrichment unit during March for couple of weeks. The company has also planned another shutdown in April 2021. This shutdown is likely to reduce the Helium availability across the region that may support its prices.
As Asia does not have any source to produce Helium, hence it mostly imports all the Helium required for industrial activities. During the quarter, most of the Helium was imported from Qatar while the Helium market in Qatar was experiencing acute shortage due to major planned and unplanned plant shutdowns. Meanwhile, the demand from the semiconductor sector was rising across the region, especially in South Korea, which supported its prices to rise across the region. Though, the industrial activities in other Asian countries like India, remained on low pace during Q1 2021, the demand for Helium imports in India remained significantly low.
In Middle East, Qatar gas is the second largest producer of helium after USA. Qatar extracts Helium with natural gas and that’s why the production of Helium also depends on the production of LNG. In February 2021, Qatar petroleum signed a deal to expand its LNG production capacity from 77 million MT/Year to 110 million MT/Year which is one of the largest single LNG project expansions in the history, which is likely to be completed by end of 2026. This expansion would improve the availability of Helium across the globe. Another news to be heard in the Middle East was the restrictions on transportation of shipments via cargo vessels from the Qatar-based port of Hamad to Jebel Ali on account of ongoing dispute between the UAE and Qatar. The tight supply situation did not see a major change during the quarter.
For the Quarter Ending December 2020
After prolonged shortage of Helium supply since July 2020, final quarter of 2020 brought stability in both supply and prices. In India, prices of Helium got stable and returned to normalcy. According to Air Liquide, a global leading gas company, China witnessed a growth of around 3.5% in the overall industrial gas consumption which was due to the rapid recovery in the industrial activity during the final quarter. Besides, market sentiments of large industrial activities like metal fabrications and electronics appreciably improved in South Korea during Q4 which directly impacted the consumption of industrial gases like Helium.
Demand for Helium gradually declined in North America and remained below average for leading companies like Air Liquide, whose Helium sales went down by 15% in Q4 2020. Furthermore, the sales of carrier gases comparatively improved from the previous quarterswith increase in activities in the manufacturing sector. In addition, Blue Star Helium, one of the leading Helium suppliers of USA, has upgraded its P50 grade Helium resources by 16% to 3.5 billion cubic feet during the final quarter and expanded its drilling program from 3 to 5 wells. This mega expansion is expected to add on to the Helium export potential of the region and is likely to improve the local as well as global Helium supply as well.
In Middle East, Qatar gas is the second largest producer of Helium after USA. Qatar extracts Helium with natural gas and that’s why the production of Helium also depends on the production of Liquified Natural Gas. During October, Qatar’s massive production facilities were shut for maintenance which impacted the global LNG and well as Helium supply and its prices. Later, in December the supply of global Helium came back to normal as several producers resumed their production as the market sentiments appeared optimistic.