The North American hydrogen peroxide market experienced strong demand growth last year, but the lack of new capacity led to a tight supply-demand balance. However, this year's demand growth is expected to slow down. According to Harriman Chemsult, a London-based consulting firm, U.S. demand for hydrogen peroxide is projected to grow by 3% to 4% in 2005, significantly lower than previous years. Degussa, one of the major players in the industry, noted that the actual demand for hydrogen peroxide in North America hasn't met initial expectations. Despite a three-year upward trend in prices, the profitability of hydrogen peroxide production in the region is under pressure. This is mainly due to rising natural gas prices and soaring transportation and logistics costs, which have increased operating expenses for manufacturers. Moreover, with the current tight supply situation, it has become increasingly difficult to establish new production facilities. Companies are now focusing on optimizing existing operations rather than expanding through new construction. Some are even considering deconstruction or reconfiguration of older plants to meet growing needs without significant capital investment. This shift in strategy highlights the challenges facing the hydrogen peroxide industry in North America as it navigates a more complex economic landscape. While demand remains steady, the combination of higher input costs and limited capacity expansion options is reshaping the competitive dynamics of the market.

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