Scarcity of helium keeping prices aloft

July 6, 2014
Monica Fernandez, floral designer at the Washington Square Flower Shop, fills up a helium balloon at the shop. Because of a helium shortage, prices for helium filled balloons have gone up. - Katie Roupe / Observer-Reporter Order a Print

Bob Lloyd has seen the price of helium rise as precipitously as a balloon he fills with it.

“It’s $165 to fill a tank,” said the owner of Washington Square Flower Shop in the city. “When I started this business in 1988, it cost $35.”

That’s a 471 percent increase, not out of line with spikes in food, gasoline, housing and sports tickets over the past quarter-century, but a formidable hike nonetheless. Especially in light of this cruel irony: Helium is the second most abundant element in the universe.

An insufficient amount of it is being produced, however, and there is a global shortage – and has been for several years. This scarcity has hoisted the price of a gas that not only boosts businesses that sell balloons, like Lloyd’s, but is necessary to key industries such as health care.

The cost that suppliers charge providers, of course, gets passed to consumers – meaning those graduation, birthday and wedding balloons are sky high in a financial as well as literal sense.

Lloyd, whose shop has been on North College Avenue for 17 of its 26 years, has felt an impact from the inflated cost of helium. He said it hasn’t been prohibitive, though, because balloons are a complementary element of his main product.

“Our business is fresh flowers,” he said. “We use helium as an add-on to our sale.”

He did acknowledge that the add-on of helium-filled balloons has resulted in add-ons to the prices of arrangements, but not large ones.

But unlike some merchants, Lloyd said he has a reliable – and local – helium supplier: Cryogenics Gas Industries International of Washington. And because floral arrangements are Washington Square’s specialty, the owner said “we go through only four tanks (of helium) a year. That’s not an extensive amount.”

Balloons over Washington, conversely, is all about, well, balloons. Judy Kubichar runs the business from her home along Washington Road in North Strabane Township, a seven-minute stroll from The Meadows.

She uses a lot of helium for balloons she provides in arches and small bunches for many occasions, usually going on site to decorate. For an article nearly two years ago, Kubichar said the gas was costing her 35 to 50 percent more than previously and thus had to charge customers more.

Last week, she said her cost had stablized, but she doesn’t expect it to decrease. “Prices won’t go down because they never do – in anything,” she said, laughing.

Kubichar said business has been steady, and that she efficiently got through June – her busiest month, due largely to graduations and weddings. She credited her supplier, Welding Repair Equipment and Service of Meadow Lands, for never leaving her short.

Helium also is essential to health care, computer chip manufacturing and cooling nuclear reactors, and is used in cryogenics, high-energy accelerators, arc welding and silicon wafer manufacturing.

That gas is a priority in a hospital, for magnetic resonance imaging systems.

“Helium is absolutely essential to MRI production,” Tom Rauch, global sourcing manager for GE Healthcare, said in a 2012 article in Popular Mechanics magazine. GE Healthcare is a giant among makers of magnetic resonance imaging systems.

The most important part of an MRI system is a magnet that has superconducting wire cooled to minus 452 degrees Fahrenheit.

“Helium,” Rauch explained, “is currently the only element on Earth that can effectively keep the magnet this cold and consequently allow for the high field strength, stable and uniform magnetic fields that make modern MRI systems possible.”

Global scarcity of the gas, however, “hasn’t had much effect” on operations at Washington Hospital, said Larry Pantuso, vice president of planning and business development for Washington Health System. He said there is an adequate supply.

Pantuso said another common use for helium at the hospital is for intra-aortic balloon pumps, for patients needing circulatory support with a failing heart.

The helium story is many-sided.

The U.S. produces about 75 percent of the world’s helium. much of it in the Texas panhandle. Helium used for industry is a byproduct of the production of natural gas, and fields between Amarillo, Texas, and Hugoton, Kan., have a very high concentration of helium – higher than in fields in other helium-producing nations.

That is why the U.S. government, in 1925, built the nation’s largest storehouse for helium, the Bush Dome near Amarillo. It is an underground reservoir connected to a pipeline that links the stored gas with helium refining facilities and natural gas fields.

About a half-century ago, because helium was integral to military reconnaissance and the space race, Congress wanted to assure a large reserve. So it mandated that the government urge private producers to sell the gas to the nation, as part of the Federal Helium Program.

Nearly 30 years later, Congress reversed itself by privatizing the helium program. It required the government’s helium supplies to be sold by 2015. The thinking was that by 2015, with the reserve sold, other sources of helium would be tapped to fulfill demand. Some production plants are expected to start up in the next few years, but private firms haven’t produced the quantity of helium that Congress had envisioned in 1996.

This is why the price of that gas is increasing, availability is diminishing and consumers lament the ballooning costs.

Rick Shrum joined the Observer-Reporter as a reporter in 2012, after serving as a section editor, sports reporter and copy editor at the Pittsburgh Post-Gazette. Rick has won seven individual writing awards, including two Golden Quills.

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