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December 9, 2016
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July 11, 2000
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April 3, 1958
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This document is circulated for agency review prior to formal committee consideration. Agency comments, issues or questions to be brought before the formal meeting;_should.be.reported to the Executive Secretary (Code 112- Extension 4252) (Room 5312, Commerce Building) by the close of business CONFIDENTIAL. April 3, 1958 .OC DOCUP.`ENT NO. 1392 Supplement 1 TO: Chairman, Operating Committee FRONT: Corrmerce Member SUBJECT: Export of Phthalic Anhydride to European Soviet Bloc Reference: OC Document 1392 if Background In the reference document,, the Department of Commerce recommended that three applications covering the export of phthalic anhydride to the European Soviet Bloc be rejected. This recommendation was concurred in by the Operating Committee. (PD 1348). The Department stated,, in the reference document, that a technical review was being conducted to determine whether.phthalic anhydride should be placed on the control list. This study has been completed. (See attachment -1), 2. Recommendation In the light of this study, the Department of Commerce concludes that phthalic anhydride does not qualify for either multilateral or unilateral control; and that the rejection of applications by the U.-S.. does not contribute to the security of the United States, and has no effect other than to transfer the business to.European producers. The Department therefore proposes that future applications for the export of phthalic anhydride to the Soviet bloc be viewed.. favorably. Additionally, it is recommended that favorable action be taken. on a formal appeal which has been received from the applicant in Case No, 150697 (See attached letter from Monsanto); on a request for reconsideration received from the applicant in Case No. 176481, (See attached letter from Leslie Kleyman);,and on, an additional case (No. 197744)which was recently resubmitted. This third case was originally submitted in early February. and iras.RWAtd. CONFIDENTIAL *DOC Exempt Letter On File* Approved For Release 2000/08/26 : CIA-RDP62-00328A000100170005-3 Approved For ReleSse' 2000/08/26CAUAT900328A000170005-3 ?-2- These three cases, all of which are for the USSR, total approximately 52500.9000 lbs. 34 Strategic `valuation An analysis of phthalic anhydride in terns of PD 1100 indicates that the criterion for strategic rating are not met. Specifically, phthalic anhydride is not designed.specially or used principally for the development, production or utilization. of arms,, ammunition, implements of war or atomic energy materials. Its military'signifi- canoe stems from the use of products .for which- it is the raw material, and not from the use of phthalic anhydride as such,, ' Attribute three is therefore not met. The technology for producing phthalio anhydride is well known through- out the world, and in any case such technology is not extractable from. the material itself. ? Attribute four is therefore not met, The primary military 'signVicance of phthalic: anhydride stems from its use as a` raw material for the production of. p hthalate esters, which are plasticizers used in making. rocket fuels and other .military propellants (See 'table 1). The data on Soviet bloc pro ductioii indicate that Soviet production is of such magnitude that no critical deficiency of this material exists. U.S. consumption of phthal:c anhydride far ,plastic:Lzers in. 1944 was 69 . million lbs., used for cable lacquer, -insect repellants, and propellants. Soviet bloc production?of~phthalic-anhydride is reported as 40 to 46 'million' lb's. '.as, of.::1954, which would: be more than ample. for propellant requirements.. Attribute 'five is therefore not met. (It:is..interesting to note that phthalic anhydride was at one time on List III (item 3754) but was decontrolled in 1954. It was one of the items for vuhich the original. U.S*. position was to delete. (JOG Doe 1/3754 dated 5/7/54)? It is not on the current U.S. list of items. proposed for International =?con.trol. as prepared by the Ad Hoc Subcommittee on List Review and adopted by. ]EDAC.) B..0 Unilateral Control The attached fact sheet shows that Western European production capacity is 343 million pounds per year, as compared with 425 million pounds in the United States, and that U.S. exports to Western Europe totalled 10.4 million pounds in 1956 and 17.5 million pounds in the first eight months of 1957 (data includes both phthalic anhydride and phthalate esters). 11"W "M .~xx.~ wa~ rr w~.s~ws a. a. wren .^ 1 !fMk1lF Approved For Release 2000/08/26 : CIA-RDP62-00328A000100170005-3 Approved For Release 2{ ;p/08/26: CIA-RDP62-00328A0001001WO5-3 CONFIDENTIAL -3- These proportions are such that U.S. unilateral controls would clearly be ineffective. In this connection, it should be noted that both France and Italy have included phthalic anhydride in their trade agreements with the U.S.S.R. (hoscow D-365 dated 1/16/58; Paris D-1267 dated 1/29/58; COCOk Doc 2942B dated 2/25/58) Under these circumstances of trade and supply potential, and in view of the indirectness of the relationship of phthalic anhydride to military uses, and of the small proportion of strategic as against non-strategic uses, this commodity does not appear to qualify for unilateral embargo control by the United States.. Attachments: 1. Fact Sheet 2. Letter from Monsanto 3. Letter from Leslie Ifleyman Approved For Release 2000/08/26 : CIA-RDP62-00328A000100170005-3 CONFIDENTIAL Approved FoA %Q0/08/26 : CIAO-00 A000100 W005-3 Fact Sheet .> Phthalic Anhydride march 1958 A. Description Phthalic anhydride (P.A.) is one of the most important cyclic chemicals. It is produced either from coal tar (via naphthalene) or synthetically from petroleum (via orthoxylene). Some 60 -? 70 million dollars worth are produced annually in the United States. Actual U. S. production was 331.4 million lbs. in 1955, and 315.2 million lbs. in 1956. P.A. is a major raw material used for the production of alkyd type surface coating resins (about 55%), esters for plasticizers (35%), an intermediate for a red coloring compound (5%), and miscellaneous other uses (5%). The phthalate esters are produced by reacting P.A. with various alcohols. C. Technology Production of P.A. from naphthalene involves the processes of vaporizing, catalytic conversion, crystallization, and purifica- tion by distillation. The anhydride is then melted and flaked. In its production from orthoxylene, there is vaporization with excess air to avoid explosion, catalytic conversion, condensation, distillation and flaking. Esters are produced by reacting alcohols with P.A. in the presence of concentrated sulfuric acid. Equipment required must be resistant to highly corrosive chemicals, and suitable for working with high pressure or under high vacuum. Heat transfer controls and other controls to keep pressures and temperatures to close tolerances are also necessary. Supervision of equipment must be under highly trained technicians to avoid explosions or the degradation of final products. D. Strategic Uses 1. P.A. esters (phthalates) used as plasticizers give propellants certain desirable. burning characteristics and keep the mixed, solid propellants in condition during storage as such or when incorporated in the shell or missile. (See Table 1.) 2. While peacetime usage in the U. S. is primarily for paints and plastics, the wartime pattern of 1944 shows 122.million lbs. of P.A. practically all allocated to military and other essential requirements. Of this amount 38 million went into alkyd surface coatings (largely paints) and 69 million were used for plasticizers for cable lacquer, insect repellants, and -for single and double base propellants of the types shown in Table 1. CONFIDENTIAL Approved For Release 2000/08/26 : CIA-RDP62-00328A000100170005-3 AttA tdVoP a 2000/08/MK -00328A000 170005-3 A recent survey of U. S. work in the field of solid propellants gives the following information on plasticizers: 1. Use; of plasticizers For plasticizing nitrocellulose type propellants, the phthalate esters used included the dimethyl, diethyl and dioctyl. Other plasticizers used are esters of acetic, adipic and sebacic acids as well as the solvents triacetin and diethylene glycol. Adipo- nitrile is also mentioned, The JATO unit developed for the Air Force by Standard Oil Co. of Indiana, which was based on ammonium nitrate with cellulose acetate as a binder, used a variety of plasticizers, including the phthal- ates, triacetin, glycols and dinitrotoluene. The survey states that the choice of plasticizer has an important effect on the ballistic properties of a propellant. 2. Thy es of plasticizers Plasticizers listed in the current Plastics Encyclopedia for use by the plastics industry demonstrate the availability of many other possibilities. Specifically, those groups known to be useful in plastics include the following chemicals or their derivatives: Abietic acid Camphor Ethers Adipic acid Caprylic acid Ethy'.Lhexoi acid Azelaic acid Citric acid Fumeric acid Benzoic acid Coconut oil Glycerine Biphemyl Epoxy Glycols Hydrocarbons Palmitic acid Ricinoleic acid Laurie acid Paraffin Sebacic acid Malefic acid Pelargonic Stearic acid Myristic acid Pentaerythritol Styrene Naphthalene Phosphoric acid Succinic acid Nitrile Phthalic acid Sucrose Oleic acid Polyesters Sulfonic acid Tall oil Tartaric acid Actually a list of over 300 specific chemicals is shown in the Encyclopedia and the unlisted other chemical combinations are in- finite in number. About half of the 300 listed are phthalates, however, indicating the importance of this type of plasticizer for all uses, i.e., in plastics as well as propellants. For reasons of cost, availability and superior performance, the phthalates appear to be the most attractive both for military and nonmilitary uses, CONFIDENTIAL "} a~~4?~dpprov" " oeea e 20 8729 - - ~Otif"TT Approv A +L ltas1e k 26 : CI kAW4 1 A000100'1"I 005-3 .a 3.. E. 2. Continued: Production of plasticizers in the U. S. is shown in Table 2. In 1955 over 212 million pounds of phthalates were produced out of 396 million of plasticizers. In 1956 the ratio was 237 out of 417 million. Production by type of phthalate is shown in Table 3. F. Sources of Supply 1. World Production Available data. for the rest of the Free World indicate some 393 million pounds of capacity per annum as of 1956. This compares with an estimated 425 million for the U. S. in the same year. (Table 4). By contrast, the 1954 Soviet Bloc production is reported at 40 to 46 million pounds, of which the U.S.S.R. had 15 to 22 million and East Germany most of the balance. Table 5 shows these estimates by country. 2. International Trade in Phthalate Anhydride and its Esters, (Tables 6 and 7). Note: The full extent of such trade cannot. be measured due to statistical classification difficulties. Some countries combine the anhydride with: ethers, or the anhydride with its esters. Some countries show basket categories which include a number of related chemicals, thereby concealing the data completely. G. Free World Trade with the Soviet Bloc Recent shipments to the Soviet Bloc from Western Europe are shown in Table 6. France and Italy have included phthalic Anhydride in trade agreements with the U.S.S.R. A recent report indicates that a Dutch firm has a Russian order for 22 million pounds of P.A. The proposed source of this material is not known. The U. S. licensed 1.3 million pounds for the U.S.S.R. in September 1957 and 200,000 pounds for Czechoslovakia in October. The U. S. rejected applications for an additional 2 million pounds for the U.S.S.R. in January 1958. A request to extend the time validity for Its tons of the P.A. licensed to Czechoslovakia was also rejected in January. CONFIDENTLAL Approved For Release 2000/08/26 : CIA-RDP62-00328A000100170005-3 A4 edtmWiFc9r R '2Q00/08/26 : CIA-RDP62-00328A0001170005-3 CONFIDENTI^ L - -4- Prior Years Control Phthalic anhydride and its esters were formerly Item 3754 (MESL 47101- #B 709), but were deleted during the 1954 review. Task Group Members BFC < Messrs. R. Stewart, F. Magnuson. L. Keiston BDSA .. Mr. W. Lowe Walde Defense Mr. Fred. Bates AEC Mr. Fred C. Lee State Mr. Thomas S. Strong TABLE 1 a.o lb, Propellants which require Phthalate Esters (Illustrative List in Class and Description. or Name Propellant Small arms - .30 light rifles Guns Mortar Rockets - Terrier sustainer Western Ball Powder Single base powder Ml M6 Double-base propellant M8 Double base "0 G Ktt Terrier booster Double base "0 I Y" Nike booster Double-base 110 I Ytt Talos booster Double base 110 I Ytt FFAR (Aircraft folding fin) Double-base "N - 5tt CONFIDENTIPL ,Ap! bs n5Dt Fielea$erQ W08/26 : Cl CC ~ A000100400005-3 -5 - TABLE 2 U.S. Production of Plasticizers 1955-1956 (Millions of lbs.) Price per Pound 1955 1956 1956 Total 396 117 .32 Plasticizers, Cyclic Total 297 315 .30 Phosphoric acid esters 143 41 .32 Phthalic anhydride esters 213 237 .29 All other cyclic plasticizers 21 41 37 .32 Plasticizers, Acyclic 100 101 .39 Adipic acid esters 11 9 .44 Azelaic acid esters 21 - 10 .142 Glyceryl monoricinoleate 0.3 0.3 .32 Oleic acid esters 12 10 .32 Phosphoric acid esters 10 7 .143 Sebacic acid esters 9 11 .58 Stearic acid esters 10 11 .24 Triethylene glycol di(caprylate-caprate) 2 1 .41 All other acyclic plasticizers 2/ 46 43 .37 NOTES: Data for 1956 are preliminary 1/ Includes data for synthetic camphor, certain phosphoric acid esters, toluene-sulfonamides, tetrahydrofurfuryl cleate, and other cyclic plasticizers. Includes data for citric and acetylcitric, azelaic, palmitic, tartaric, and ricinoleic acid esters, and for butyl myristate, glyceryl and glycol esters of certain fatty acids, glyceryl tripropionate, complex polymeric materials, and other scyclic plasticizers. Sources U. S. Tariff Commission. CONFIDENTIAL Approved For Release 2000/08/26 : CIA-RDP62-00328A000100170005-3 AtW0#ftA)bAd orQWbMe 2000/08/WNIS[AAFU3M-00328A000'400170005-3 TABLE 3 U.S. Production of Phthalate Esters - 1955-196 (Mill on lbs.) Tn)e of Phthalate 19 5 1956 Dioctyl 30.6 31.0 Diethyl