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The US outlook for water-treatment chemicals to be strong in the short term

June 02/2011

(ICIS) -- The US outlook for water-treatment chemicals will likely be strong in the short term because of dry, hot weather through much of the country, sources said on Wednesday. In North America, the peak of the water-treatment season lasts from the US holidays of Memorial Day at the end of May to Labor Day at the start of September. The summer heat bodes well for companies such as Arch Chemicals, which makes calcium hypochlorite, used in swimming pools and spas.

Other chemicals used in water treatment includes caustic soda, chlorine-based chemicals and varying coagulants such as aluminium sulphate. But the season comes at a time when the rest of the general economy is still lagging.

Typically, peak summer water usage can be up to double that of winter usage, said Alan Roberson, director of regulatory affairs for the American Water Works Association, a trade group that represents municipal water utilities.

Cost for chemicals to treat the water - ­which can vary depending on the geography and utility - are the second biggest cost outside of power. Together, the two costs can make up about 10% of a utilitys budget.

And utilities are becoming constrained with rising raw material costs, particularly in commodity markets such as caustic soda.

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