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Nanotube Supply Glut Claims First Victim

Bayer Material Science closes carbon nanotube production to focus on core business

2 min read
Nanotube Supply Glut Claims First Victim

Just three years after announcing a huge capacity increase to its multi-walled carbon nanotube (MWNT) production, Bayer Material Science has announced that it will completely close down its MWNT production to focus on its core business.

This is no surprise since there was a huge glut of product resulting in industry utilization rates that must have been in the single digits. This oversupplied market was the result of a MWNT capacity arms race that started in the mid-2000s. While this steep ramping up of production capacity reduced pricing from $700/kg in 2006 to below $100/kg in 2009—with some estimates putting the price at $50/kg as of last year—the problem seemed to be that no matter how cheap you made the stuff nobody was buying it because there were no applications for it. This resulted in stories, at once humorous and worrisome, of big chemical companies that had gotten themselves caught up in this arm race making desperate phone calls to laboratory researchers pitching application ideas for the material.

While some observers believed that this price cut would result in the applications being developed, most people recognized that this was a case of putting the cart before the horse, or “technology push” ahead of the preferable “market pull.”

This is not to say strategically it was wrong for a company like Bayer Material Science to build out capacity for a product that nobody seemed to want at that moment but may in the future. A company like Bayer can ramp up production with relatively little capital cost and manage to price everyone else out of the market. It was worth the risk.

However, hindsight makes it pretty clear that MWNTs applications were never really going to materialize as had been hoped. This became painfully clear when after a few years into production one of the target applications being touted for the material was the blades of large wind turbines. That announcement smacked of desperation.

Despite this, the story of MWNT capacity growth has been very instructive for how the so-called “nanotechnology industry” will shake out.

First, it’s clear that small operations that have found a way to produce a nanomaterial cheaply will have a difficult time competing with large chemical companies. This is not because they can’t produce the material more cheaply or at a better quality, but because they do not have the supply chain that well-established chemical companies have.

Second, you don’t want to be in the business of producing a nanomaterial that serves just to make some other product. You want to be making the final product. Many small start-ups no longer exist because they figured that they could just license their technology to a company that would make a product from their nanomaterial.

Bayer Material Science is in the position where it can just mothball its production without too much pain, but there may be some other companies that are less diversified for which that may not be an option. Sometimes when one domino falls the rest go in quick succession. So this should be an area to watch in the near future.

Image: Martin McCarthy/iStockphoto

The Conversation (0)

3D-Stacked CMOS Takes Moore’s Law to New Heights

When transistors can’t get any smaller, the only direction is up

10 min read
An image of stacked squares with yellow flat bars through them.
Emily Cooper

Perhaps the most far-reaching technological achievement over the last 50 years has been the steady march toward ever smaller transistors, fitting them more tightly together, and reducing their power consumption. And yet, ever since the two of us started our careers at Intel more than 20 years ago, we’ve been hearing the alarms that the descent into the infinitesimal was about to end. Yet year after year, brilliant new innovations continue to propel the semiconductor industry further.

Along this journey, we engineers had to change the transistor’s architecture as we continued to scale down area and power consumption while boosting performance. The “planar” transistor designs that took us through the last half of the 20th century gave way to 3D fin-shaped devices by the first half of the 2010s. Now, these too have an end date in sight, with a new gate-all-around (GAA) structure rolling into production soon. But we have to look even further ahead because our ability to scale down even this new transistor architecture, which we call RibbonFET, has its limits.

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