> ## Content Index
> Fetch the complete content index at: https://www.bullished.co/llms.txt
> Use this file to discover other available public pages before exploring further.

# Balchem CFO: Oil Near Highs Is 'A Net Negative' Even As Fracking Sales Climb To $8 Million
- URL: https://www.bullished.co/balchem-cfo-oil-near-highs-is-a-net-negative-even-as-fracking-sales-climb-to-8-million-d25b37a1/
- Published: 2026-10-23T16:07:16.000Z
- Updated: 2026-10-23T16:07:16.000Z
- Description: Martin Bengtsson says the fracking-linked choline chloride business is only edging up while oil-driven inflation pushes costs higher.
- Author: Matteo Parrino
- Tags: Earnings, BCPC, Industry: Materials

[Balchem](https://www.bullished.co/tag/bcpc/), which makes specialty ingredients for nutrition, food, pharmaceutical, animal health and industrial markets, gets little help from high oil prices, CFO Martin Bengtsson said on the company's earnings call Friday: "It would be a net negative for us." Fracking demand for its choline chloride is rising, he said, but from a tiny base, and the third-quarter results the company [reported Friday](https://www.globenewswire.com/news-release/2026/10/23/3387159/0/en/balchem-corporation-reports-third-quarter-2026-financial-results.html?ref=bullished.co) came with revenue of $291 million.

## A $105 million business that shrank

Answering an analyst from H.C. Wainwright, Bengtsson said Balchem sells some choline chloride into the fracking industry, which he called a $5 million business last year. The current run rate, he said, is more like $8 million.

Twelve years ago it was a $105 million business. He does not expect a return to that scale, because drillers have reformulated their fluids and started reusing them, and cheap international product is coming in. "I don't think that will be a big driver of upside for us, only on the margin," he said.

Balchem has filed for U.S. anti-dumping action against those low-priced imports. Bengtsson said a preliminary ruling is expected toward the end of the year.

## Oil means inflation

Higher oil prices otherwise mean more inflation for Balchem, Bengtsson said, through transportation and logistics, utilities and raw materials derived from petrochemicals. "High oil prices is not necessarily a good thing for us," he said, adding that the company would be happy to see prices ease.

He said Balchem has seen raw material inflation all year and passed it through to customers. Year to date the effect is about break-even, he said, though passing costs through dollar for dollar slightly dilutes margin percentage, offset by favorable product mix.

## Inventory at $177 million

An analyst asked about inventory, which ended the quarter at $177 million, a high figure historically, Bengtsson said. He gave four reasons: inflation raising purchase costs, growth of 9% year to date, deliberate extra safety stock of critical raw materials because of Middle East and other geopolitical risks, and stock built ahead of product launches.

The balance sheet is otherwise light on debt. Balchem cut net borrowings by $28 million in the quarter and ended with a net leverage ratio of 0.2 times. It also repurchased about $28 million of its stock. Market value was $5.5 billion at the time of the company's report Friday.

Bengtsson said fourth-quarter results are normally lower than the third on seasonality, but Balchem expects continued year-over-year growth, with full-year results due in February.

### Sources

- [Balchem Non-GAAP EPS of $1.57 beats by $0.04, revenue of $290.7M beats by $1.45M (NASDAQ:BCPC) | Seeking Alpha](https://seekingalpha.com/news/4656500-balchem-non-gaap-eps-of-1%5F57-beats-by-0%5F04-revenue-of-290%5F7m-beats-by-1%5F45m?ref=bullished.co) — seekingalpha.com
- [Balchem Corporation Reports Third Quarter 2026 Financial](https://www.globenewswire.com/news-release/2026/10/23/3387159/0/en/balchem-corporation-reports-third-quarter-2026-financial-results.html?ref=bullished.co) — globenewswire.com

### More on Balchem

- [Balchem CEO Says Another Sports Deal Is Coming, With A More Global Reach](https://www.bullished.co/balchem-ceo-says-another-sports-deal-is-coming-with-a-more-global-reach-a29ca8e5/)
- [Balchem Net Earnings Climb 16% As Sales Grow In All Three Segments](https://www.bullished.co/balchem-net-earnings-climb-16-as-sales-grow-in-all-three-segments-fa387700/)

[All Balchem (BCPC) coverage →](https://www.bullished.co/tag/bcpc/)