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Posted: 8:00 p.m. Wednesday, Sept. 19, 2012

Helium shortage affects small businesses first

By Eric Schwartzberg and Kelli Wynn

Staff Writer

A global helium shortage that has caused balloon retailers to scramble for tanks of the gas and raise their prices is expected to last into 2013, according to an official with the U.S. Department of the Interior’s Bureau of Land Management.

Local welding and gas companies and balloon retailers rely on helium, which is a non-renewable resource and considered to be a much safer gas to use. The gas also is used by high-tech businesses and hospitals.

Susan Smith, owner of Flowers by Nancy at 6401 Germantown Road in Middletown, said prices for a tank of helium have rocketed from under $100 dollars a tank a year ago to nearly $200 today.

In her 32 years in business, there’s never been a price increase like that, Smith said.

“We’ve been told where we get our helium that eventually it’s just going to be for medical use because it is a shortage and it’s not a gas that reproduces,” she said.

Keith Stall, general manager at Party City in Bridgewater Falls, said customers have been surprised and relieved to get any of the in-demand gas.

When helium supplies dried up at other locations earlier this month, the Fairfield Twp. store picked up the slack, inflating 200 more balloons than a typical weekend and lifting business by about 30 percent.

“We were slammed,” he said. “We were one of the only stores that had it, so they all flocked to us.”

Stall attributes the difference in the amount of helium available to certain stores being allocated different amounts every month.

“We just either had a slow amount going into it or their stores were busier,” he said.

Tom Newman of Matheson Gas, which has location in Hamilton, Cincinnati and Dayton, said although the company is trying to do all it can to help meet the needs of its customers, orders for equipment that require speciality helium - which goes through a different purification process - take priority.

This speciality helium can be used for balloons, “but it’s more expensive,” Newman said.

The increased cost of buying the helium tanks has led to an increased cost for consumers, Smith said.

“We’ve had to raise our prices … to make sure we weren’t losing, not going in the hole filling the balloons,” she said.

A latex balloon that sold for $1.25 at this time last year now retails for $2, Smith said.

“We are producing as much (helium) as we can, but we cannot keep up with the demand,” said Sam Burton, assistant field manager for the Bureau of Land Management’s Federal Helium Program in Amarillo, Texas. He said that the bureau offers 2.1 billion cubic feet of crude helium for sale a year.

The overseas demand for helium, a byproduct of natural gas, is increasing. For example, Asian markets have increased their helium requests by seven to 10 percent, Burton said.

“Natural gas fields are high in helium in the United States, but not overseas,” Burton said. “The good news is that we have a lot of it. It just needs to be extracted and purified.”

The government extracts the crude helium and sells it to private companies, which refine it and sell it.

Federal market needs are taken care of before private companies can purchase supplies, according to Burton. However, he said, “about a tenth of what we sell goes to government use and about 90 percent is for private use.”

Private companies are selling helium to hospitals, airplane manufacturers and those in the research industry. Helium is critical because it is used for things such as fiber optics, lasers, weapon systems, rockets and missiles. It can be used to detect dirty bombs.

“If it’s high tech, there is helium in there somewhere,” Burton said, adding that the Department of Defense, the Department of Homeland Security, NASA and Boeing all rely on helium for their operations.

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