Headline: A global helium shortage leaves businesses deflated--Production slowdowns, increases in demand have led to shortages
Might be semantics, but when I hear 'shortage,' I immediately think that the quantity demandsed at the current price exceeds the quantity supplied at that price and there is something (usually regulatory) preventing the market from adjusting prices upward to decrease the quantity demanded and increase the quantity supplied.
Unfortunately, in many cases, when a non-economist writer refers to a 'shortage' they simply mean a demand increase or a supply decrease that puts upward pressure on the price and causes people to have to adjust from their current comfy position.
That seems to be the case with helium:
In the Baltimore area, some florists and party-supply businesses are scrambling to find new suppliers for the helium that floats their balloons. Most are paying more for supplies, while some have raised prices or temporarily turned customers away. Other industries are feeling deflated too; besides blowing up balloons and blimps, helium is used to eliminate oxygen in welding in the aerospace industry, to cool magnets in MRI scanners and to help deep-sea divers breathe a nitrogen-free mix of air.
The supply-and-demand imbalance has become more acute recently in the United States, some experts say. The shortage results from cutbacks in global production combined with increased demand from industries such as health care and semiconductor manufacturing, experts said.
A supply decrease combined with a demand increase means a shortage if the price doesn't rise. But, as the first paragraph states--prices are rising to alleviate the shortage. As prices rise, people adjust behavior. They might not like it, but change happens.
But for those who took helium for granted, news of the shortage has popped up unexpectedly.
Nope. Higher prices may have caught them off guard, but I'm pretty sure, there aren't lines at the balloon shop.
"We've been selling balloons for 30 or 40 years, and I've never run into anything like this," said Mike Koletar, second-generation owner of his family's The Flower Cart, a Baltimore-based florist with three locations, including a shop at Johns Hopkins Hospital. "It seems like the last few months it's gotten a lot worse. I can buy balloons with air in them on sticks, but they don't float. Helium makes them float."
Thanks Mr. Wizard.
While medical centers don't appear to be lacking helium supplies, some experts worry about the effect of a long-term shortage.
That's because the demand for helium from medical centers is much less elastic than demand for helium from balloon shops. If the price of helium rises, the quantity demanded for medical purposes doesn't fall by much. I'm no doctor, despite the sign on my office door, but I doubt there are many ready substitutes for helium for medical imaging.
"I've been concerned about it," said Jeff Brown, chairman of radiology at the Washington University School of Medicine in St. Louis, who has been involved in MRI scanning for 25 years and said helium has proved to be the most efficient coolant for powerful MRI magnets. "There aren't really any good alternatives for MR imaging."
Hmmm...maybe I should be a doctor.
The latest shortage, which started about two years ago, has left some medical facilities, researchers and even the military scrambling to replenish supplies or forced to curtail work, said Joe Peterson, assistant field manager for helium reserves for the federal Bureau of Land Management.
"There are orders out there for helium that are not able to be fulfilled as immediately as customers would like to have them," Peterson said. But "the industry hit the hardest has been party balloons and those types of applications, where helium is a nice thing to do but not an absolute necessity. I've heard about difficulties in meeting needs for helium and delays of two to three months."
Oh, the humanity. There are substitutes for helium balloons. I'm pretty sure we will survive with balloons on a stick for a while.
Koletar, The Flower Cart owner, said his two main suppliers began informing him of shortages around Christmas.
"We had to wait for tanks to come in and get on a waiting list," he said "We just made it through Valentine's Day."
Wow, that was close. Men around the world sighed in relief.
At one point, he ran out of helium for about a week and had to turn balloon orders down. He was finally able to rent a helium tank from a welding supply company.
We may not be able to build skyscrapers, but at least desperate moms around the world can buy balloons for their one-year old's birthday party.
But just wait until Thanksgiving in New York. I can't have turkey without seeing 40ft Snoopy floating through Herald Square.