The production of phthalic anhydride has increased remarkably since the discovery of the vapor phase catalytic process of manufacture. Until 1922 the only large outlet was the coal-tar dye industry. The development of new uses for phthalic esters, principally dibutyl phthalate, increased the demand during the period 1922-28. With the drop in price of phthalic anhydride, resins made from it and glycerin became of commercial interest and about 1929 their production began to increase sharply. Most of the increased output since that year is accounted for by its use in alkyd resins. As previously stated, surface coatings made from these resins are now applied to practically all “indoor” surfaces, both wood and metal, and to “outdoor” use on metal. Largely as a result of the growing popularity of surface coatings of the alkyd type the domestic production of phthalic anhydride exceeded 45 million pounds in 1937 and may reach 50 million pounds in 1938. This estimate is based on the present trend of consumption of alkyd resins and current use therein of phthalic anhydride. Should other polybasic acids be used in greater proportion the estimate would have to be revised. Considerable research work is being done on certain polybasic acids, with very promising results in some instances. Maleic anhydride is being used commercially, as are adipic acid, malic acid, and succinic acid. Other possibilities include such acids as citric, tartaric, sebacic, fumaric, and oxalic. Production in other countries. Phthalic anhydride is manufactured in Germany, England, France, Italy, and Japan, but no statistics of foreign production or of international trade are available. The output in Germany is known to be increasing rapidly and is believed to be the principal reason for the German embargo on exports of naphthalene. In England there are two makers: Imperial Chemical Industries, Ltd., and Monsanto Chemicals, Ltd. The latter is a branch of the American firm of the same name. In Italy, production was started in 1928 by the A. C. N. A. at Cengio. Capacity is given as 600,000 pounds annually, and the process is essentially the same as in this country. Japanese production is estimated at 6 million pounds a year. Nihon Seuryo’s plant is the principal one, and the Nishijima mill, at Osaka, the next in importance. United States foreign trade. Imports of phthalic anhydride are dutiable under paragraph 27 at 7 cents per pound and 40 percent ad valorem based on American selling price. There were practically no imports since the World War until 1937, when 223,431 pounds were imported from England to relieve a temporary shortage. Exports, if any, are not shown separately in official statistics. Competitive conditions.