A major shortage of helium has begun to make its impact felt across a number of industries, as a combination of dwindling resources and increasing prices take their toll. The gas, one of the lightest substances in the world, can be harvested from natural underground deposits and from the production of natural gas, in which helium is a by-product. But there are currently no cost-effective ways of artificially producing the gas, which has left a host of sectors scrambling. While helium usage is widespread, its sources are relatively limited, and the U.S. has provided the lion's share of the world's supply for decades. According to Gasworld, more than three-quarters of the globe's helium is produced across three different locations—Texas, Wyoming and Qatar. The U.S. will exit the helium business by the end of September 2021, as established by the Helium Stewardship Act of 2013. Also, resources in Texas have dwindled because of a combination of different factors. Helium production in the U.S. has significantly slowed down and the Bureau of Land Management has been forced to ration its supply, due to political upheaval in the Gulf States. In February last year, Saudi Arabia imposed an economic embargo on Qatar, which effectively took some 30 percent of the global supply off the market. While helium might be best known as laughing gas and for its use in balloons, it plays a crucial role in a number of different industries, from the aerospace to the medical sector. It is used in the manufacturing of electronics and semiconductors, and is also used as a cooling agent for magnetic resonance imaging machines. "It is a serious problem," Roman Dembinski, an organic chemistry professor at Oakland University, told USA Today. "A shortage and disruption would quench our magnets, so we would be without instruments." Experts noted that demand from countries such as China was increasing and the growing development of high-tech manufacturers had also put producers under pressure. With resources shrinking and demand increasing, prices have sky-rocketed. In September, a government auction carried out by the Bureau of Land Management saw crude helium prices for delivery in 2019 jump 135 percent year on year. The global shortage has hit a number of companies. Chief among those is Party City, which announced on Thursday that it would close 45 stores, accounting for 5 percent of its locations. The New Jersey-based party supplier said it normally shuts between 10 to 15 stores each year, and the latest round of closures came as it aimed to improve its market performance. "We've made the decision to close more stores than usual in order to help optimize our market-level performance, focus on the most profitable locations and improve the overall health of our store portfolio," the company's chief executive James Harrison said in a news release. Harrison, however, also indicated Party City had secured a new helium supplier, which should minimize the fallout from the current shortage. "We believe this new source should substantially eliminate the shortfall we are experiencing at current allocation rates and improve our ability to return to a normal level of latex and metallic balloon sales," he said.<doc-sep>Helium is getting hard to find these days, and it’s ruining parties for people of all ages. No helium, of course, means no helium balloons, and what's a celebration without balloons? Among moms who are trying to plan graduation parties and end of the year school events, the worldwide helium shortage has been a hot topic, especially on parent blogs and at PTA meetings. "It’s definitely a bad thing," said Laurie Sigelko, who has been struggling to find helium-filled balloons for weeks. "As simple as balloons are, they are an absolute staple for parties of all different kinds, from little children’s parties to adult anniversary parties.” Balloons make dull rooms come alive, said the 51-year-old Rochester Hills mother. They are colorful, festive, and — in comparison to flowers, cheap. And there's another party benefit: When the gas is inhaled, you sound like a "Wizard of Oz" Munchkin. Still, scientists add, a helium shortage — which has been years in the making — is no laughing matter. Read more: Even in a Michigan outdoor paradise, ticks are a growing public health threat Michigan teen made viral Buzzfeed quizzes for free. Now she's cashing in "It is a serious problem," said Roman Dembinski, an organic chemistry professor at Oakland University. "A shortage and disruption would quench our magnets, so we would be without instruments." In fact, as helium prices surge to new highs, some researchers and companies in the medical industry, which uses the gas as a coolant in magnetic resonance imaging and nuclear magnetic resonance, are suggesting a ban on party balloons. Without helium, doctors will not be able to give patients noninvasive, life-saving MRI scans that detect damage to organs and tissues. Researchers at Oakland University wouldn't be able to use the NMR spectroscope. "If the superconductive magnets warm up because of a shortage of helium, they will quench — the process that the magnets are no longer superconducting," Dembinski said. "To keep the instruments running, there must be a continuous supply of helium." Balloons just got real An element of the periodic table, helium is what chemists call an inert gas. Helium has an atomic number of 2. It's nontoxic, nonflammable, and is used in several industries because it is the element with the lowest boiling point, about minus 452 degrees. But, now that the gas is in short supply and the price of it has shot up, it’s not entirely clear what will happen. No helium means there would be no laboratory particle accelerators — sometimes called atom smashers — that use electromagnetic fields to send changed particles at high speeds for physics research. Helium also is used in space flight to pressurize the fuel tanks of liquid-fueled rockets, in satellite instruments, in aerospace for supersonic wind tunnels and even combined with oxygen to create nitrogen-free atmospheres for deep sea divers. Without helium, there would be no weather balloons and no Goodyear Blimps, the oblong blue and silver airships that float over sports stadiums on game day. A big reason for the shortage is that about 75% of all the helium comes from just three places: Ras Laffan Industrial City in Qatar, ExxonMobil in Wyoming and the National Helium Reserve in Texas, according to gas-trade publication Gasworld.com. In Texas, the reserves are being depleted, while at the same time overall demand for the gas has been growing. The federal government started storing helium during World War I at the Cliffside Storage Facility near Amarillo, Texas, for national defense. Back then, the gas was used for airships. Remember the giant German Zeppelins? The reason the Germans filled their dirigibles with flammable hydrogen instead of nonflammable helium was because the U.S., which had much of the world's helium, limited its export. Military demands for helium continued during World War II, and during the Cold War, as the gas became important for aerospace, the space race with the Soviets and other scientific applications. But by the 1990s, the federal government decided that it didn't need as much helium on hand, likely because airships and spacecraft were seen as less important to national security, and began drawing down the Texas gas reserves. Now, private industry, including Canadian company American Helium, and other countries, such as Qatar, are trying to find new sources of helium and build new plants to process the gas. And even though helium comes out of the ground, it is mixed in with natural gas at varying concentrations. The higher the concentration of helium the more efficient it is to remove, so not every natural gas deposit is a candidate for helium extraction. Willing to pay for it In the meantime, party planning parents are going to great lengths to find stores selling helium. They are driving tomultiple places where helium balloons were once plentiful — party stores, grocery stores and dollar stores — with no luck. Party City, an East Hanover, New Jersey-based retail chain with more than 800 outlets, has even published warning to customers that balloon orders might be affected. Under the heading "Global Helium Shortage," it cautioned that "helium supply has always been a little up in the air (pun intended)." The company proposes alternatives such as balloon arches and walls that don't need helium, just tape, and it pledges to help customers who can't get helium balloons still "throw an unforgettable party." But, that response was no consolation to one mom who posted her failed attempt to find balloons on Facebook. She ended her saga with a curse and a question: “WTF. Now where do I go for fun balloons?” And that kind of post makes Party City executives anxious. In late February, CEO James Harrison blamed the national retailer's lower than expected fourth-quarter results on "helium supply pressures" and "higher helium costs." Still, some parents, when they find a store with helium, are willing to pay more. Earlier this year, when Aimee Symington tried to plan with other moms a banquet for her daughter Gracie's dance club, she had trouble finding a place that would guarantee her helium balloons. Gracie, and Sigelko's daughter, Hannah, are co-captains of the JV dance team. The moms needed 40 to 50 blue and gold balloons — Stoney Creek High School's colors — to make table centerpieces for the hall the group was renting at Cherry Creek Golf Club. They called at least three party stores. None could help. "You can have a party without balloons," said Symington, 43, of Rochester, acknowledging that there are worse things than parties without balloons. "But it's just not the same." Initially, they budgeted $50, about $1 a balloon. The bill: $139.64. The Sterling Heights shop Symington and Sigelko ended up going to, Party Paradise, said it's able to get helium for balloons, although it knows that many other retailers aren't. Kevin Brikho, who co-owns the store with his brother Sam, said the price of helium has gone up about 30% since January. As a result, he said, they have had to pass the costs on to their customers. "Back in 2004, a balloon was like 33 cents," he said. "Now, it's $1.99." Scientists are divided on whether the global supply of helium, a nonrenewable resource, will run out anytime soon. But, helium price increases likely will lead more and more helium balloon buyers to just forgo them. If there aren't helium-filled balloons at your party, don't let it get you too down. "It would be a little sad," Symington said, noting the loss. "But, the world will go on." Contact Frank Witsil: 313-222-5022 or fwitsil@freepress.com. Helium facts What is it? Helium is odorless, colorless and tasteless gas. Where does it come from? It occurs with other gasses in the ground. The most economical source is natural gas. In the United States, it is found in Texas, Kansas, Colorado, Utah and Wyoming. How is helium produced? When a gas pocket containing recoverable amounts of helium is found, a well is drilled to release it. The gas travels by pipeline to a processing plant where the helium is separated out from the other gasses. Source: U.S. Department of Interior<doc-sep>
A woman fills a helium balloon for a customer in Raleigh, North Carolina. Chris Seward| Raleigh News & Observer | Tribune News Service | Getty Images There's a major helium shortage affecting a host of industries — and it's not clear how anyone is going to solve it. The naturally occurring resource is well-known to the general public for its use in balloons, but it is also an important component of medical and aerospace technology. In fact, its list of potential uses includes some cutting-edge technology. But the world is running low on helium and businesses are scrambling. Here's what you need to know. Currently, helium cannot be produced efficiently and economically. The few ways it can be harvested includes extraction from natural underground deposits, or from the production of natural gas in which helium is a byproduct. As helium is a very light gas, it has to be captured quickly, or it will float up into space. Three main sources produce some 75 percent of the world's helium — sites in Qatar, Wyoming and Texas — according to gas industry publication Gasworld. In fact the U.S. has for decades provided much of the world's supply. However, the U.S. government will be exiting the helium business, according to a 2013 law. The helium the government owns is in Texas, which is being depleted. There is no helium futures market, but a U.S. government auction carried out by the Bureau of Land Management last September saw crude helium prices jump a whopping 135 percent on-year for its 2019 delivery, according to Gasworld. It was the last auction of U.S. reserves to be sold to a private industry. Meanwhile, overall U.S. production has also fallen as the bureau has been rationing supply since February 2018 after a group of countries lead by Saudi Arabia announced an economic embargo of Qatar. That created chaos in the helium supply chain for weeks as roughly 30 percent of the global supply was taken off the market. While that has been resolved, new supplies that are supposed to come online have been delayed and unplanned plant outages have further impacted the market, wrote Phil Kornbluth, a veteran helium industry consultant. But demand from high-tech manufacturing, including demand from China, is also rising. In a market dominated by just a few sources, any disruption in the supply chain will have a magnified impact. "The problem is, helium is being used up faster than it can be produced these days," wrote Anders Bylund, an analyst at Motley Fool in a recent note. Why does it matter? A versatile gas, helium is primarily used in electronics and semiconductor manufacturing and is particularly important for medical imaging, such as magnetic resonance imaging (MRI). Helium is used as a cooling agent in MRIs and in manufacturing processes. Because helium is stable and does not react with other elements, it is also used in the making of semiconductors to create a contamination-free environment. Still, the biggest consumer use of the gas is in party supplies — and that area is being hit especially hard by the shortage. Party City — listed on the New York Stock Exchange — warned on its website that supplies of the gas are "a little up in the air" amid a "global helium shortage." At the company's fourth quarter results briefing in February this year, Party City CEO James M. Harrison said revenues were below expectations "in large part due to helium supply pressures." Party City posted revenue gains and locked in 41 percent in gross margins last year. Still, the company's share price has tanked by 30 percent in the last six months. According to Motley Fool's Bylund, that's primarily because it's been hit by the dwindling supplies of helium gas, one of its key raw materials. "A company whose revenue relies on selling helium-filled balloons does suffer from the shortage," said Bylund. "Helium shortages fluctuate over time and across geographical markets, but anywhere between 50 and 200 of Party City's 850 stores don't have any helium in their tanks at any given time." So investors have been punishing Party City's stock for this "obvious shortcoming," he added. Little help seems to be at hand in the short-term to replenish the helium supply, and Party City has had to offer other solutions like decorative air-filled balloons. What's being done?