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| The curvaceous edge of a private pool complements the curves of a lone pool float. Photo: ©Brad Walls @bradscanvas Brad Walls Photography |
Even if your summer plans extend only as far as your own backyard, the bill for a barbecue is going up, with chicken breasts and wings in particularly short supply. Planning to float around in a pool?
And, there’s also a shortage of the chlorine tablets that are commonly used to zap parasites and prevent algae from growing in the water. So prices are soaring there, too.
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| Net merchant prices for chlorine from leading producers in Texas and Louisiana have jumped 70% from a year earlier on an indexed basis, with the trendline indicating elevated levels through the end of the summer, according to IHS Markit. Source: IHS Markit |
The chlorine squeeze is especially acute because Americans are more pool-happy than ever. Demand for pool upgrades and new construction skyrocketed during the pandemic as stuck-at-home consumers focused their spending power on sprucing up their backyards. Even pool owners who didn’t do any extra work started using their pools more; what else was there to do?
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| Killian Belliard French Personal Trainer and Social Media Influencer leaps into a Greek Infinity Pool @Killian___ |
The trend was a big help to the industry: Pool Corp., a distributor of maintenance supplies and related products, generated a record $3.9 billion in revenue in 2020. Hayward Holdings Inc., which makes pumps, cleaners and automation equipment and went public in March, reported a nearly 20% jump in net sales last year and forecast another increase of as much as 45% in 2021.
The chlorine market likely would have been able to keep up were it not for a fire at a BioLab chemical plant in Louisiana last August in the wake of Hurricane Laura, Stuart Baker, vice president of business development at Hayward, said in a phone interview.
The damage rendered the plant inoperable, taking out a facility responsible for a significant portion of the popular chlorine tablets produced for the U.S. market. There are few alternative domestic sources of supply, and Chinese imports are complicated by freight issues fouling up other parts of the global supply chain and U.S. tariffs, industry experts say.
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About two-thirds of the 5.2 million residential in-ground pools in the U.S. use traditional chlorine systems, and that means the problem will affect the vast majority of pool owners, Baker said. But few consumers seem aware of the issue. “They think this is our problem,” Stewart Vernon, founder of America's Swimming Pool Co., a franchisor of cleaning and repair service outlets across 22 states, said in a phone interview. “And it is in a way — until there truly is no chlorine and we can’t sanitize their water. I don’t know if it will come to that.”
A 50-pound bucket of chlorine tablets costs about 50% more than it did a year ago, while the 20-pound bucket preferred by residential users is roughly 30% more expensive, Michael Egeck, chief executive officer of Leslie’s Inc., a pool-products retailer that went public last year, said in a phone interview. Leslie’s proactively stocked up on chlorine tablets because of the boom in demand for pools and the company’s models show that supply should last through Labor Day, but “honestly, it’s going to be close,” Egeck said. A banner on the Leslie’s website warns that customers are limited to one bucket of chlorine tablets to help manage the demand.
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| One of the best hotel swimming pools in America The Phoenician, Scotsdale |
The crunch in the chlorine tablet market is a microcosm of the broader vulnerabilities in supply chains that support everything from personal protective gear to semiconductors. Almost any disruption that could happen has happened in the last year and a half: a global pandemic that forced countries into unprecedented lockdowns; volatile swings in demand; shortages of workers and empty cargo space; a ship lodged in the Suez Canal; a cyberattack on a key U.S. pipeline; and hurricanes, deep freezes and fires that shuttered factories. Suddenly, networks that previously seemed rock solid (when did you last worry about chlorine tablets?) started to look rather rickety.
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| "Symmetry" Photo: ©Brad Walls @bradscanvas Brad Walls Photography |
Just to show how interconnected these supply networks are, Egeck of Leslie’s said another pinch point is the tight resin market in the U.S., which has made it harder to get the plastic buckets and lids for packaging products like chlorine tablets.
There are alternatives to tablets: Pool owners can use granulated or liquid forms of chlorine instead but these have to be applied manually and are more of a stopgap measure, Vernon of America’s Swimming Pool said. His franchisees have been pre-buying what tablets they can and he’s been building a supplemental inventory at the corporate level to help patch shortfalls. But even with those efforts, come late August or September he's envisioning having to hand feed these backup chlorine options into pools and “limping along" from week to week. Of course, if too many people lean on these types of chlorine, they might run out, too.
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| Killian Belliard French Personal Trainer and Social Media Influencer contemplating a Greek Infinity Pool @Killian___ |
Hayward and others also sell equipment that generates chlorine from salt via electrolysis. These systems offer the benefits of a chlorinated, clean pool without many of the annoyances, including the harsh chemical smell and itchy eyes. Another option is ultraviolet light or ozone-based sanitizing technology — or some combination of the two. These systems blast viruses and certain bacteria that are resistant to chlorine. They are more common in large, commercial pools but are gaining ground in residential settings, particularly as the pandemic heightens awareness of how the body is exposed to particulates and pathogens, Baker of Hayward said. Some chlorine is still needed as a supplement but with the UV and ozone systems doing the heavy lifting, pools don't need nearly as much to stay clean.
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| Killian Belliard French Personal Trainer and Social Media Influencer pool reflections @Killian___ |
The chlorine shortage may end up inspiring a wave of converts to these alternatives. Salt-to-chlorine systems were already the preferred choice for new pool construction and Hayward and others see an opportunity in the tablet sticker shock to sell more existing owners on the benefits. Vernon of America’s Swimming Pool said the company had sold a record number of salt systems recently. But they don’t work for everyone: Salt systems can corrode certain kinds of stone or metal components without proper maintenance and setup. Installing a salt-chlorine generator, UV or ozone system also entails more upfront expenses than chlorine tablets. The cost should balance out over time, but convincing consumers to make the initial investment may depend on how long chlorine supplies remain tight. The BioLab plant is expected to come back online by the spring of 2022, but Vernon cautions that the supply-demand equation may remain lopsided through next summer and that prices will stay elevated.
"Once prices get raised by the wholesaler, it's unlikely they will dial back once they get customers like us paying those levels," he said. "The pool business is famous" for this.
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| "Fall" Photo: ©Brad Walls @bradscanvas Brad Walls Photography |
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