Wednesday, March 28, 2001

Foot-and-mouth silver lining Bohemian chemicalmaker sees boom in sales as country tries to prevent spread of disease By Frantisek Bouc It's a familiar scene on the evening news these days: amused but weary-looking drivers and passengers, a line of cars trailing behind them, pile out of their vehicles, hoist their pant legs and soak the soles of their shoes in a small pool of disinfectant. Drivers may be exhausted by the lengthy waits that now greet them at the country's border crossings due to the new ritual, part of an effort to keep foot-and-mouth disease from spreading here. But it's nothing compared to the fatigue of workers at Bochemie Bohumin. A crew of 170 has been working three shifts a day, seven days a week, trying to fill a growing stack of orders that are landing on the company's door. Bochemie is the country's only manufacturer of a white powder called chloramine, a key ingredient in the suddenly in-demand agricultural disinfectants that help stanch foot-and-mouth, a disease that has recently devastated British agriculture and has the rest of Europe sweating. Petr Mastny, Bochemie's deputy CEO, acknowledges the crisis has been good for business. "We aren't vultures," he said. "But it's obvious that a situation in which our entire production is sold within hours is quite unique and has positive results on our economic situation." The highly contagious disease, though not a danger to humans, affects cloven-hoofed animals such as sheep, cattle, pigs and goats. It can be transmitted through the air, on the wheels of vehicles or the soles of shoes. Disinfectants are believed to be one of the best methods of containing its spread. Bochemie stepped up production in early March, as soon as it got word that the State Veterinary Office wanted to make disinfectant mandatory at Czech border crossings and every farm. The country also shut 70 pedestrian border crossings, stopped the transport of hoofed animals from certain countries through the Czech Republic, and started confiscating food products at the border. The disease, which has already done damage totaling more than $700 million (25.9 billion Kc) -- and counting -- to British farmers, has spread to Scotland and Ireland, and made its way to continental Europe in mid-March. Cases have shown up in France and the Netherlands, and are suspected in Italy. Until now, the chloramine powder, used for routine agricultural disinfecting, was only a small portion of Bochemie's business. "The demand has risen by over 50 percent. ... We work three shifts, including Saturdays and Sundays, in order to pump up our output to maximum," said Mastny. The company shifted more of its 390 workers than usual to chloramine production, and found itself exceeding its prepaid limits with the electric company in its all-night, frantic efforts to meet the demand. Bochemie sells dozens of tons of chloramine each day to agricultural distributors, who then sell it to farmers, and now, customs offices. Despite Bochemie's increased production, some clients lament it's just not enough. "We order around 100 kilos [220 pounds] every day, but it happens that we get only a third or a half of it," said Karel Benak, a spokesman for the Aspra company, which was in charge of disinfecting border crossings in north Bohemia. Supply and demand Mastny admitted that Bochemie was unable to satisfy around 20 percent of demand. Czechs have other options -- they can buy foreign products, made by giants like Procter & Gamble or Johnson & Johnson -- but they cost more and are more difficult to get, he said. "We cautiously monitored the [foot-and-mouth disease] spread in Britain in February, and we calculated with maximum production in March," Mastny said. "But such a demand is simply beyond our capacities, whatever we do." Josef Duben, spokesman for the State Veterinary Commission, said the short supply puts the country in a difficult position. "While we can order the disinfecting [at farms and borders], we can't influence production of disinfectants," Duben said. The government will likely extend its preventative measures beyond the original March 27 cutoff, Duben said. The Czech Republic isn't the only country struggling to fill the demand for disinfectant. Panicked British farmers cleared shelves in many areas, and there were reports of hoarding and price gouging in several small towns. Bochemie Bohumin is the largest subsidiary of the Bochemie Group -- an umbrella organization for 13 companies in chemical, photochemical and pharmaceutical industries. The group's sales last year climbed up to 1.68 billion Kc ($45.4 million), a 21 percent rise, year-to-year. Bochemie Bohumin, the chemical subsidiary, saw its sales grow from 563 million Kc to 686 million Kc last year. The demand for its disinfectant is expected to further boost the company's bottom line. Mastny declined to discuss sales figures. Though Bochemie, founded in 1904, is one of the country's largest makers of household cleaning and disinfecting products, it's tiny compared to international competitors such as Procter & Gamble or Johnson & Johnson. Bochemie focuses on exports to countries including Vietnam, Russia, Romania and Poland. The disinfectant became a flagship product once before, in 1997, when massive flooding hit. "The demand then was even higher than now, because some two-thirds of the country needed to disinfect," Mastny said. "Thanks to that experience, we can handle the current situation much better." Frantisek Bouc's e-mail address is fbouc@praguepost.cz More business stories The holy grail of beer Bay Area businessman completes 20-year odyssey to bring Budvar to U.S. shelves Deficit irks bank officials World Bank says country must cut spending significantly Movers & Shakers New faces zoom into Zoom Spaces & Places ING becomes three