Why Guar Beans Matter

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Audio Transcript:

Lisa Mullins: Now, another story that caught our eye this week involves beans — guar beans to be precise. You might not be familiar with them, but Halliburton is. The company says its profits dropped recently because of a lack of guar beans. It turns out the guar gum is used in Halliburton's hydraulic fracturing operations, you know, fracking, the controversial method used to drill for deep natural gas deposits. As for what guar gum is exactly, we asked Patrick Di Justo, who writes the monthly "What's Inside"  column for Wired magazine.

Patrick Di Justo: Guar gum is used in food as a thickening agent because it's very much like corn starch. It can be used as a lubricant in drilling because, while it's used as a thickener in ice cream, guar gum is less thick than mud. So as they drill through rock and mud, guar gum being less thick, actually works as a lubricant.

Mullins: Well, we asked David Biello to chime in. He is the Associate Editor for Environment & Energy at Scientific American magazine, and we asked him to start off telling us everything he knows about guar beans in thirty seconds or less.

David Biello: Wow, that's quite a test. Well, the guar bean is an agriculturist crop primarily grown in India. The name actually means "cow food" and that's what they used to use it for in India, but now it is primarily grown to produce guar gum which is used as a thickener in foods and has a variety of other industrial applications.

Mullins: So it's pretty amazing that the price of a little guar bean can have such a large impact on an enormous industrial process or the profit margin of a major company such as Halliburton. It seems counter-intuitive, but how does that happen?

Biello: That is surprising and actually that suggests that guar gum is becoming quite the desirable commodity and that we will soon see it growing in places other than India. How it can have such an outsized impact on fracking is because fracking, as you know, is done primarily with water and that's the main ingredient in their kind of "special sauces" for breaking up the rock down there to get the natural gas out. But in addition to the water there's sand, petrochemicals, and then there's guar gum. Obviously, the water and sand are cheap or free and the petrochemicals are relatively inexpensive. That makes guar gum potentially one of the more expensive bits in the special sauce and thus it can start to have this outsized impact. That said, these special sauces tend to vary from company to company, so it's likely that we would see some replacements for guar gum in the not-too-distant future.

Mullins: So about if we look at this in the other direction? How do these big processes affect the production and the availability of the very substance they rely on? For instance, are the guar beans, well, is it likely that they'll become scarce or that more people might start growing them to feed the demand?

Biello: Yeah. Absolutely. They have already become scarce. And this show how something like the weather can have knock-on effects kind of a halfway around the world, and this is the era of globalization. These kinds of supply chain issues are more and more common. It's particularly true with agricultural products. I think probably the most common example is with corn and ethanol that's been used to kind of cut down on our oil imports, but turning all that corn into ethanol has had knock-on effects on everything from cattle feed to food prices around the world and then those food prices, those high food prices, tend to make people upset.

Mullins: So does what's happening right now with a little guar bean create opportunity or present a huge problem, as it seems to be right now, at least for Halliburton?

Biello: It's both. That's probably not a very satisfying answer. It's a problem in that for the moment there's not enough guar gum to go around and so they're going to, you know, the prices will probably continue to rise in the short term. In the long term, that means farmers will plant more guar beans, we'll probably start growing it in the United States a little bit more, and Halliburton will also work on ways to kind of minimize let's say it's exposure to this tiny bean from India.

Mullins: David Biello, Associate Editor for Environment & Energy at Scientific American. Thanks for being in the program and explaining all about the guar bean. Thank you.

Biello: Thank you.

Mullins: This is PRI — Public Radio International.