Ferric Chloride Supply Chain - Executive Summary

Ferric Chloride

Direct Use Chemical

FeCI3

(liquid, solid)

Inputs to Manufacturing Process:

Chlorine

Ferrous Chloride

J* Derivative Water Treatment Chemicals:
*

None

^ % of Total Domestic Consumption
Attributed to Water Sector:
Approximately 80%

Understanding Chemical Supply Chains
Map of Suppliers & Manufacturers

A. Product Family:
Chlor-alkali
Iron

CAS No.: 7705-08-0

2 Shelf Life:
6-12 Months

— RISK OF SUPPLY DISRUPTION (Assessed in 2022)

RISK RATING: Moderate-Low

,eiaw-ww Mode/a,

RISK DRIVERS

Production of ferric chloride de-
pends on the steel and chlor-
alkali industries to produce manu-
facturing inputs. Unplanned and
planned reductions in chlor-alkali
production capacity and de-
creased demand for steel have
reduced the supply of ferric chlo-
ride.

RISK PARAMETERS

Criticality: High. Essential for
coagulation and dewatering.

Likelihood: High. Previous
regional disruptions in supply that
impacted the water sector.

Vulnerability: Low. Distributed
domestic manufacturing and
supply.

MANUFACTURING PROCESS

Water Treatment Applications

Ferrous Chloride

Chlorine

Ferric Chloride

Input	End Use

Coagulation
Sludge dewatering

Other Applications

Etching

•	Metal surface treatment

•	Chemical reaction catalyst

DOMESTIC PRODUCTION AND CONSUMPTION, AND INTERNATIONAL TRADE

Domestic Manufacturing Locations (2015):
19, distributed throughout the U.S.

(^) International Trade (2019)

PrimaryTrading Partner (Imports): Canada
PrimaryTrading Partner (Exports): Thailand

Domestic Consumption (2019):

322 M kg

I Domestic Production (294 M kg)
¦ Imports for Consumption (28 M kg)
I Export of Domestic Production (0.2 M kg)

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Ferric Chloride Supply Chain - Full Profile

Product Description

Ferric chloride (FeCI3), an inorganic iron salt, is a widely used coagulant and dewatering agent. It is primarily
produced as a byproduct of steel pickling, a process that relies on iron oxide, hydrochloric acid, and chlorine.
Water treatment applications are the primary commercial use of ferric chloride in the U.S.

Use in Water Treatment

Ferric chloride is used as a coagulant in both drinking water and wastewater treatment and as a sludge
dewatering agent (NCBI, 2021).

Use as a Precursor to Other Water Treatment Chemicals

Ferric chloride is not used as a precursor in the commercial manufacture of other water treatment chemical.
Other Applications

Ferric chloride is used for electronic and photographic etching, metal surface treatment, and as a catalyst in
chemical reactions for products such as vinyl chloride (NCBI, 2021).

Primary Industrial Consumers

A considerable amount of the ferric chloride produced worldwide is used in water treatment. It
estimated that 80% of domestic consumption of ferric chloride is used in water treatment, with
used in wastewater treatment (NCBI, 2021).

Manufacturing, Transport, & Storage

Manufacturing Process

Ferric chloride can be produced with a number of starting materials. Production may start with the process of
steel pickling or with a solution of ferrous chloride produced through steel pickling. Ilmenite, the raw material
used to produce titanium dioxide, can also be used but is a less common source of iron oxide in North America.

The method most commonly used in North America utilizes a reaction of spent steel pickling liquors with
hydrochloric acid, followed by subsequent chlorination of the product (AWWA, 2012). Pickling of steel removes
the surface mixed iron oxides through immersion in a bath containing either a sulfuric or hydrochloric acid
solution. As described in the manufacturing process for the ferrous chloride supply chain (EPA, 2022a), when
hydrochloric acid is used the mixed oxides in the oxidation layer of the steel as well as the underlying iron react
with the hydrochloric acid to form ferrous chloride. The solution is reacted with additional hydrochloric acid to
produce ferrous chloride with a higher iron and lower acid concentration. The solution is filtered and
chlorinated, resulting in production of a concentrated ferric chloride solution, as shown in Figure 1 (Alcaraz et
al., 2021; Michigan DEQ, 2015; Ozdemir, et. al, 2006).

Ferrous Chloride +

Chlorine —>

Ferric Chloride

2FeCI2 +

Cl2 ->

2FeCI3

Figure 1. Chemical Equation for the Reaction to Manufacture Ferric Chloride

Ilmenite, the raw material used to produce titanium dioxide can also be used but is a less common source of
iron oxides in North America. Production as a byproduct of the manufacture of titanium dioxide results from the
process to remove the iron oxide impurities present in low-grade titanium ore such as ilmenite. Iron oxides can
be removed through a process of selective chlorination, which involves heating the titanium ore in the presence

has been
the majority

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Ferric Chloride Supply Chain - Full Profile

of additional carbon and chlorine gas and results in titanium tetrachloride, carbon monoxide, and ferric chloride
(EPA, 2001; Habashi et al., 2014; Jung et al., 2021).

Product Transport

Ferric chloride may be transported in bulk or container by truck, rail, and ship (LabChem, 2017).

Storage and Shelf Life

Ferric chloride is corrosive and acidic, and as such should be stored in corrosion-resistant container in a cool, dry
area. When stored properly, ferric chloride can have a shelf life of approximately 6-12 months (LabChem, 2017;
SalChem, 2015).

Domestic Production & Consumption

Domestic Production

Production data was collected from the 2020 Toxic Substances Control Act (TSCA) Chemical Data Reporting
(CDR) for the year 2019, while trade data was collected from the U.S. International Trade Commission (USITC)
Dataweb, as shown in Table 1. While production data is specific to ferric chloride, trade data includes ferric
chloride as part of the trade category for iron chlorides.

Table 1. Ferric Chloride Production and Trade Data Sources

Production and Trade Data

Category

Data Source

Identifier

Description

Domestic Production

2020 TSCA Chemical Data Reporting

CAS No.: 7705-08-0

Ferric Chloride

Imports and Exports

U.S. International Trade Commission

HTS Code: 2827.39.55

Iron Chlorides, including
Ferric Chloride

Total U.S. domestic manufacturing of ferric chloride reported under the CDR was approximately 322 million
kilograms (M kg) in 2019 (EPA, 2020). Domestic commercial manufacture of ferric chloride takes place at select
facilities located throughout the contiguous U.S. Primary producers include PVS Technologies, Inc., and Kemira
Water Solutions. Most ferric chloride production facilities rely on the availability of chlorine and hydrochloric
acid, as well as scrap steel. The number of domestic manufacturing locations shown in Figure 2 represents
operating facilities as of 2015 (EPA, 2016). Supply of NSF/ANSI Standard 60 certified ferric chloride for use in
drinking water treatment is widely distributed throughout the U.S. (NSF International, 2021). For a more current
listing of manufacturing locations and supplier locations, visit the U.S. Environmental Protection Agency's (EPA's)
Chemical Locator Tool (EPA. 2022b).

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Ferric Chloride Supply Chain - Full Profile

O

"T!

Domestic Supply and Manufacturing of Ferric Chloride
O 88 NSF/ANSI Standard 60 Certified Suppliers (NSF International, 2021)
19 Domestic Manufacturing Locations (EPA Chemical Data Reporting, 2016)

Figure 2. Domestic Supply and Manufacturing of Ferric Chloride
Domestic Consumption

U.S. consumption of ferric chloride in 2019 is an estimate based on production of ferric chloride and trade of a
broader category of iron chlorides. Trade of ferric chloride is an unknown percentage of import and export
volume in this category. This estimate includes production of 294 M kg, import of 28 M kg, minus export of 0.2
M kg (EPA, 2020; USITC, 2021), as shown in Figure 3. Imports and exports represent small quantities when
compared to domestic production.

Domestic Consumption (2019):
322 M kg

¦	Domestic Production (294 M kg) Imports
I ¦ for Consumption (28 M kg) Export of

¦	Domestic Production (0,2 M kg)

Figure 3. Domestic Production and Consumption of Ferric Chloride in 2019

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Ferric Chloride Supply Chain - Full Profile

Trade &Tariffs

Worldwide Trade

Worldwide import and export data for ferric chloride are reported through the World Bank's World Integrated
Trade Solutions (WITS), as a category representing metal chlorides of tin, barium, iron, cobalt, and zinc. In 2021,
the U.S. ranked 14th worldwide in total exports and 8th in total imports of metal chlorides. In 2021, Germany
ranked first worldwide in total exports (WITS, 2022), as shown in Table 2. Import and export data specific to
ferric chloride are unavailable from the referenced sources.

Table 2. WITS Worldwide Export and Import of Metal Chlorides, Including Ferric Chloride in 2021



2021 Worldwide Trade



Metal Chlorides of Tin, Barium, Iron, Cobalt, Zinc (HS Code 2827.39)

Top 5 Worldwide Exporters

Top 5 Worldwide Importers

Germany

194 M kg

Netherlands

79 M kg

China

110 M kg

France

78 M kg

France

84 M kg

India

76 M kg

Belgium

79 M kg

Belgium

75 M kg

India

71 M kg

Germany

69 M kg

Domestic Imports and Exports

Domestic imports and export data are reported by USITC in categories inclusive of all iron chlorides. Figure 4
summarizes imports for consumption1 and domestic exports2 of iron chlorides between 2015 and 2020. During
this period, the overall quantity of imports grew steadily. The overall quantity of exports was much smaller than
the quantity of imports, with average values of 0.4 M kg and 19.2 M kg, respectively. Over this five-year period,
Thailand was the primary recipient of domestic exports while Canada was the primary source of imports (USITC,
2021).

1	Imports for consumption are a subset of general imports, representing the total amount cleared through customs and entering
consumption channels, not anticipated to be reshipped to foreign points, but may include some reexports.

2	Domestic exports are a subset of total exports, representing export of domestic merchandise which are produced or manufactured in
the U.S. and commodities of foreign origin which have been changed in the U.S.

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Ferric Chloride Supply Chain - Full Profile

30

Domestic Trade of Iron Chlorides
HTS Code 2827.39.55

25

e- 20

15

10

I

o o

Q. Q.

o o

Q. Q.

o o

Q. Q.

o o

Q. Q.

o o

Q. Q.

o o

Q. Q.

C x

C |_U

C x

C LU

C x

C LU

C x

C LU

C x

C LU

C x

C LU

2015

2016

2017

2018

2019

2020

I Imports from Canada
I Imports from Germany
Imports from Other Countries

I Exports to Thailand
Exports to Kuwait
Exports to Other Countries

Figure 4. USITC Domestic Import and Export of Iron Chlorides between 2015 and 2020

Tariffs

There is a 3.7% general duty for import ferric chloride and an additional 25% duty on imports from China (USITC,
2022), as summarized in Table 3.

Table 3. 2021 Domestic Tariff Schedule for Iron Chlorides

HTS Number

General Duty

Additional Duty-China
(Section 301 Tariff List)

Special Duty

2827.39.55

3.7%

25%

Free for A, AU, BH, CA, CL, CO, D, E, IL, JO, KR,
MA, MX, OM, P, PA, PE, SG3

Market History & Risk Assessment

History of Shortages

The production of ferric chloride in North America is heavily reliant on the steel industry for the precursor,
ferrous chloride, and the chlor-alkali industry for chlorine and hydrochloric acid. Economic slowdowns and a
drop in domestic steel manufacturing along with greater recycling of steel pickling liquor and fluctuating prices
for hydrochloric acid have been known to impact the availability of ferrous chloride and have led to price
fluctuations for ferric chloride.

In the fall of 2020 and continuing through 2021, there were disruptions in the supply of chlorine and
hydrochloric acid. Concurrently, there was also a contraction in domestic steel production, which reduced
availability of spent steel pickling liquors. Discussion with industry representatives indicated that challenges in
obtaining ferric chloride were primarily due to a shortage of hydrochloric acid and spent pickling liquor. In

3 Symbols used to designate the various preference programs and trade agreements. A full list of special trade agreements and
associated acronyms can be found at https://help.cbp.eov/s/article/Article-310?laneuaee=en US and the General Notes Section of the
Harmonized Tariff Schedule https://hts.usitc.eov/current

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Ferric Chloride Supply Chain - Full Profile

addition to the shortage of precursors, there was also a series of equipment failures at a major ferric chloride
production facility, and due to the specialized nature of the equipment, it took months to complete the repairs
and restore facility operations. There were also reports of truck and driver shortages impacting all parts of the
supply chain.

Risk Evaluation

The complete risk evaluation methodology is described in Understanding Water Treatment Chemical Supply
Chains and the Risk of Disruptions (EPA, 2022c). The risk rating is calculated as the product of the following three
risk parameters:

Risk = Criticality x Likelihood x Vulnerability
Criticality	Measure of the importance of a chemical to the water sector

Likelihood Measure of the probability that the chemical will experience a supply disruption in the
future, which is estimated based on past occurrence of supply disruptions

Vulnerability Measure of the market dynamics that make a chemical market more or less resilient to
supply disruptions

The individual parameter rating is based on evaluation of one or more attributes of the chemical or its supply
chain. The ratings and drivers for these three risk parameters are shown below in Table 4.

Table 4. Supply Chain Risk Evaluation for Ferric Chloride

Risk Parameter Ratings and Drivers



1

i

ICriticality High

1 Likelihood

High

(Vulnerability Low 1

Ferric chloride is an essential water
treatment chemical. It is widely used
as a coagulant and sludge dewatering
agent.

The water sector has experienced
regional ferric chloride supply
disruptions and significant price
fluctuations in the past. Lack of supply
of key inputs (steel pickling liquor,
chlorine, and hydrochloric acid)
contributed to a shortage in 2021.

Strong domestic manufacturing
capabilities and a distributed
manufacturing base provide some
resilience to supply disruptions.
However, the reliance on supply from
both the chlor-alkali and steel
industries increases vulnerability.

Risk Rating: Moderate-Low

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Ferric Chloride Supply Chain - Full Profile

References

American Water Works Association (AWWA), 2012. B407, Ferric Chloride. Denver, CO: American Water
Works Association.

EPA, 2001. Final Titanium Dioxide Listing Background Document for the Inorganic Chemical Listing
Determination, retrieved from https://archive.epa.gov/epawaste/hazard/web/pdf/tio2-bd.pdf

EPA, 2016. 2016 TSCA Chemical Data Reporting, retrieved from https://www.epa.gov/chemical-data-
reporting/access-cdr-data#2016

EPA, 2020. 2020 TSCA Chemical Data Reporting, retrieved from https://www.epa.gov/chemical-data-
reporting/access-cdr-data#2020

EPA, 2022a. Ferrous Chloride Supply Chain - Full Profile, retrieved from

https://www.epa.gov/waterutilitvresponse/water-treatment-chemical-supplv-chain-profiles

EPA, 2022b. Chemical Suppliers and Manufacturers Locator Tool, retrieved from

https://www.epa.gov/waterutilitvresponse/chemical-suppliers-and-manufacturers-locator-tool

EPA, 2022c. Understanding Water Treatment Chemical Supply Chains and the Risk of Disruptions, retrieved
from https://www.epa.gov/waterutilitvresponse/risk-disruptions-supplv-water-treatment-chemicals

Flabashi, F., Kamaleddine, F. and Bourricaudy, E., 2014. A new process to upgrade ilmenite to synthetic
rutile. Metall, 69, pp.27-30.

Jung, E.J., Kim, J. & Lee, Y.R. 2021. A comparative study on the chloride effectiveness of synthetic rutile and
natural rutile manufactured from ilmenite ore. Nature: Scientific Report, 11:4045.

LabChem, 2017. Ferric Chloride Safety Data Sheet, retrieved from
http://www.labchem.com/tools/msds/msds/LC14380.pdf

Michigan Department of Environmental Quality (DEQ), 2015. Activity Report: Scheduled Inspection,

retrieved from https://www.egle.state.mi.us/aps/downloads/SRN/B2371/B2371 SAR 20150826.pdf

National Center for Biotechnology Information (NCBI), 2021. PubChem Compound Summary for CID 24380,
Ferric chloride, retrieved from https://pubchem.ncbi.nlm.nih.gov/compound/Ferric-chloride

NSF International, 2021. Search for NSF Certified Drinking Water Treatment Chemicals, retrieved from
https://info.nsf.org/Certified/PwsChemicals/

Ozdemir, T., Oztin C., and Kincal, N, 2006. Treatment of waste pickling liquors: Process synthesis and
economic analysis. Chemical Engineering Communications, 193(5): 548-563.

SalChem, 2015. Ferric Chloride Safety Data Sheet, retrieved from

https://chemistryconnection.com/sds/data/pdf/Sodium Tripolyphosphate SDS.pdf

U.S. International Trade Commission, 2021. USITC DataWeb, retrieved from https://dataweb.usitc.gov/

U.S. International Trade Commission (USITC), 2022. Harmonized Tariff Schedule (HTS) Search, retrieved from
https://hts.usitc.gov/

World Integrated Trade Solutions, 2022. Trade Statistics by Product (HS 6-digit), retrieved from
https://wits.worldbank.org/trade/countrv-bvhs6product.aspx?lang=en#void

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