A global helium shortage has turned the second-most abundant element in the universe (after hydrogen) into a sought-after scarcity, disrupting its use in everything from party balloons and holiday parade floats to M.R.I. machines and scientific research. ...
Experts say the shortage has many causes. Because helium is a byproduct of natural gas extraction, a drop in natural gas prices has reduced the financial incentives for many overseas companies to produce helium. In addition, suppliers’ ability to meet the growing demand for helium has been strained by production problems around the world. Helium plants that are being built or are already operational in Qatar, Algeria, Wyoming and elsewhere have experienced a series of construction delays or maintenance troubles. ...
The federal government’s role in helium production began in the early 20th century. The Army and Navy prized the gas as a nonflammable alternative to the explosive hydrogen that was being used in observation balloons and airships. By 1925, Congress had created a helium program to make sure the gas would be available for national defense.
Though the government’s role has been scaled back since then, it continues to dominate the market, effectively setting the global price and supplying enriched crude helium for sale to private refineries and plants via a 450-mile pipeline system. In October, the Bureau of Land Management raised the government’s price for crude helium to $84 per thousand cubic feet, up from $75.75.
via www.nytimes.com
My knee jerk reaction was that the government is setting a price and exacerbating the shortage. But, this is just the government's price, private firms and consumers are still able to negotiate higher prices, right? Market pricing seems to be the conclusion from this August 24 post.
