The world is a big place…even for the world’s largest consumer products company. Procter & Gamble’s recent decision to focus its efforts on the 10 largest emerging markets demonstrates that growth-chasing companies can spread themselves too thin. Despite the pullback by P&G, emerging markets remain the focus for most household and personal care companies, and many surfactant suppliers are focused on an aggressive expansion plan in countries such as China, India and Brazil.

The sheer size of the Chinese and Indian populations, coupled with the growth rate in Brazil, makes most suppliers confident that emerging markets will continue to drive growth for surfactants especially as consumer products, such as shampoos and laundry detergents, become more established as everyday conveniences, noted Stewart Warburton, global marketing director, home and personal care, Rhodia Novecare.

“This growth will continue with the rise of the middle class, which leads to more consumers trading up to higher performing products,” he explained. “The biggest risk is a controlled economic slowdown inChina as the government seeks to manage inflation.”

BASF executives note that emerging markets represent a key driver in the industry—the emerging middle class, increased consumer spending and new consumer needs. As such, the company expects emerging markets to contribute 45% of sales by 2020. To get there, between 2011 and 2020, BASF plans capital expenditures of €30-35billion. More than one-third of this amount will be invested in emerging markets.

April Yeager, North American head of personal care, Clariant, noted that emerging markets represent the best opportunities for growth within personal care, but cautioned that supply chains must be robust in order to hand the growth.

Tough Times for Detergent
With premium laundry detergent sales sluggish, suppliers that offer surfactants across the value chain are best positioned for success. Rhodia, for example, sells surfactants to brands at all price points, as well as to private label companies that are actually making gains in market share, remarked Warburton.

To turn the tide in favor of premium brands again, multinationals began rolling out single-dose detergent packs but, alas, the much-hyped form hasn’t been the panacea once hoped.

“The pods bring a new level of convenience for customers and limit overuse; however, broad market acceptance is yet to be determined,” observed Warburton.

According to Steve Turner, business line director, household care business line, North America, Evonik Industries, market indications are that pod products have achieved some penetration with consumer product companies and in the market, but not to the level originally anticipated.

“Consumers are used to dosing their own laundry products. When a product is in a pod, the consumer no longer has the freedom to adjust for soil levels, or larger or smaller load sizes,” said Turner.

Consumers stroll down the street in Chengdu, China.

As it keeps an eye on the US market, Evonik is looking elsewhere for growth. The company is building an integrated production plant for organic specialty surfactants at its site in Shanghai, China, with startup scheduled for the latter half of 2013. The various specialty surfactants produced at the plant are based on regional, mainly renewable raw materials, and are in demand for cosmetics and laundry care products, as well as for industrial applications.

“In South America, we are moving forward with an investment for a 25,000 metric ton plant in the São Paulo, Brazil area,” David Del Guercio, senior VP&GM (global), household care business line, Evonik Industries. “The plant will produce a range of surfactants for cosmetics and consumer goods, with startup targeted for 2014.”

According to Del Guercio, these economies are achieving stronger than average growth rates, which in turn, contributes to a rising middle class. Generally, consumers in regions with higher growth rates have more income to spend on higher standard of living items such higher performance laundry detergents, fabric softeners, and home care products.

However, Neil A. Burns, managing partner, Neil A. Burns LLC, Freehold, NJ and CEO of P2 Science Inc., a new surfactant company, warned that emerging markets are not monolithic; rather, they are highly diverse, with difference business conditions and cultures and consumer preferences. He noted that, according to UN figures, US household consumption ($10 trillion) is larger than that of the next five countries (Japan, China, Germany, France and the UK) combined. Meanwhile, Brazil’s consumer market is just one tenth that of the US.

“So, to really address the emerging markets, you have to be ready to handle complexity on a scale you do not see in the mature economies,” said Burns. “By their own admission, it seems that P&G spread itself too thin in the emerging markets and is now focusing on the top 10likely to be Brazil, Russia, India, China, South Africa, Nigeria, Poland, Turkey, Mexico and Indonesia—still more than a handful for any company.”

Personal Care Strength
While laundry detergent makers struggle, surfactant suppliers agree that the personal and hair care sectors remain healthy. According to Warburton, the personal care surfactant market has been resilient in developed countries, growing close to GDP, and growing above GDP inemerging marketswhere personal cleansing products are now established as necessities.

“This is still a great innovative market with the advantage that the small luxury, like a new lipstick, is always possible in even the worst recession,” said Burns.

Meanwhile, the hair care segment has been booming in Asia and Latin America.Asia is seeing strong growth in shampoo and conditioners whereas growth in Latin America is driven by conditioners formulated with cationic surfactants and tertiary amine ingredients, said Warburton.

Natural personal care products continue to be a bright spot, according to Paul Washlock, business line director, personal care business line, North America, Evonik Industries. He noted that in North America, about 4 in 10 shampoo and conditioner launches are for responsible care products—about double the global rate.

“Consumers are very interested in organic sourcing on skin care products, too,” added Washlock. “In the leave-on skin care segment, sun protection and skin feel are often critical attributes. Evonik works with global and regional customers to offer innovative solutions for these trends.”

More Formulation Ideas
Yeager of Clariant suggested that sensory benefits and unique ingredients which provide potentially new claims or performance aspects to the products, sustainable materials and naturals remain high on consumer wish lists for ingredients.

Stepan Company is working with its customers on re-formulation efforts associated with cost/performance and in response to new regulatory requirements, noted Anne Gariepy, marketing services manager, Stepan Technical Service.

“We are also aligned with our customers’ need for sustainable solutions in the areas of cold water cleaning, compaction, concentrates and broad spectrum/reduced contact time disinfection,” she said.
Inemerging markets, the key driver for surfactant-based products is value, according to Warburton.Indeveloped markets value is also important but improved ingredient and packaging sustainability is driving a lot of new product design.

“Consumers have an increasing desire for products tailored to specific hair and skin types, such as shampoo for fine hair and ultra mild body wash for sensitive skin,” he added.

According to Turner, in today’s market, customers still seek cost savings or price-performance advantages.

“Additionally, sustainability goals and environmentally-friendly products continue to play an important role in markets, but consumers still want to have products which guarantee high-performance, too,” said Turner. “So the goal must be to achieve both performance and value.”

According to Mark Miller, VP-care chemicals; home and personal care, I&I, North America, BASF is focused on intelligent solutions that combine high performance with sustainability. Care Chemicals’ broad portfolio based on renewables and petro-based chemicals opens a wide range for a variety of formulations and product claims. BASF’s products, formulated in detergents and cleaners, support energy saving, resource efficiency and safety.

Specific examples are:

• Readily biodegradable products like Trilon M (an alternative to phosphates in automatic dishwashing) and Lutropur MSA (an organic acid for hard surface cleaning); and
• Low temperature washing due to Tinocat TRS KB2 (highly efficient metal catalyst for bleaching additives, stain removers) and Tinopal CBS type (fluorescent whitening agents with a high bleach stability and outstanding whiteness on cellulosic fabrics).

Regulatory Factors
Although most suppliers agreed that the regulatory climate is quiet, Gariepy noted that California OEHHA Proposition 65 listing of Cocamide DEA (CAS 68603-42-9) and DEA (CAS 111-42-2) as carcinogens is a concern for consumer product companies who manufacture or sell in California.

People shop inside Meena Bazaar in the Red Fort in Delhi, India. Built 300 years ago by Mukarmat Khan, it was the first covered bazaar in India.

“Stepan Company anticipated that this would be a concern for our customers when the listing was initially proposed and focused research and development efforts on review of our specialty amphoteric portfolio for potential recommended off-sets in the application areas of liquid dish, hard surface care, vehicle care and hand soap,” she explained.

Rhodia’s Warburton pointed to REACHand NGOs that continueto focus on improving the purity ofsurfactants, which can result in reformulation opportunities and improved process efficiencies.

Del Guercio noted that while it’s not new, the REACH initiative requires resources to register and test to generate data for existing and new products. Likewise, for GHS, the UN’s Globally Harmonized System of Classification and Labeling of Chemicals, Evonik will invest resources to educate and train employees and customers on the new classifications. The initiative includes new hazard classifications that will harmonize with OSHA and other regulatory authorities.

According to Del Guercio, many home and fabric care customers are requesting products be listed in the CleanGredients database so end formulators can register their formulation with DfE. Evonik continues work to ensure its products meet the classifications.

What’s New?
During the past year, according to Yeager, Clariant has made a few bolt-on acquisitions that help bolster its store around sustainable ingredients.

“We have plans to further strengthen our platform over the next several years to become known in the industry as the go-to company for sustainable ingredients which provide superior sensorics,” she added.

After purchasing a sulfonation plant in Vespasiano, Brazil in 2006, Stepan has upgraded the facility and added new capabilities including the installation of neutralization equipment that enables the company to expand and diversify its product offerings.

“Expanding our presence in Brazil continues to be an important element in our surfactant growth strategy,” noted Lorraine Maloney, business development manager, Stepan Company.

Elsewhere, Stepan acquired a large methyl ester plant located on Singapore’s Jurong Island. Now, the company is producing coconut oil-derived methyl esters there.

“This facility offers fractionation capability (currently 60ktpa) in a continued effort to build our Asia surfactant franchise and to supply our methyl esters and derivatives to our customers on a worldwide basis,” explained Maloney.

Solvay completed a new surfactant site at Zhuhai, expanding capacity in China by 50,000 metric tons a year.Key surfactants include amphoterics for shampoo and personal cleansing products, and cationics for hair conditioners.

Additionally, Rhodia has taken significant steps inits joint venture with Sibur, the Russian petrochemical company. The goal of this strategic partnership is to create a surfactant specialty leader in the Common Wealth of Independent States (CIS).

“We have now completed studies to set up local surfactant production in Russia at Sibur’s petrochemicals site in Dzerzhinsk, 400km east of Moscow,” said Warburton. “Rhodia and Sibur are working together with customers to build opportunities and support regional growth strategies.

Consumer demand in the region is growing rapidly (CAGR 8%) and there is increasing desire for more sophisticated shampoos, conditioners, shower gels, laundry and household detergents.”

Although pods provided a sales lift, they have not been the panacea to what ails the laundry detergent category.

In North America, Evonik is making investments to enhance capacity at Mapleton, IL and Janesville, WI facilities. Evonik has invested in Hopewell, VA, the North American headquarters for the Consumer Specialties unit, to ensure compliance with the future regulatory requirements for organo-modified silicone chemistry.

“In addition to that, with our investments in China and Brazil, we’re also expanding our presence in the emerging markets regions,” explained Del Guercio. “Our goal is to provide our customers with a broad global network which operates strongly on a local level.”

Miller noted that the last two acquisitions in which BASF Care Chemicals was involved were Ciba in 2008 and Cognis in 2010. Company executives said the moves completed BASF’s product range and fit perfectly with the company’s growth strategy.

“As a result, BASF can offer a unique portfolio of surfactants (petro-based and renewables), polymers, chelating agents, optical effect products, biocides, waxes and wax emulsions as well as corrosion inhibitors and methanesulfonic acid,” explained Miller.

At the same time, he noted, Care Chemicals operates production and development sites as well as sales offices in all regions.

“The company’s investments in world-scale plants underline our commitment to the home care and I&I market, for instance, the Trilon M and the nonionic surfactant plant in Nanjing,” said Miller.

Most recently, BASF broke ground on a new production facility for personal care in Dahej, India and good progress continues at the BASF research campus in Shanghai.

In other moves, BASF unveiled its new personal care brand Care Creations and communications concept “Inspired by Life,” along with several product launches at In-Cosmetics Barcelona and the New York Society of Cosmetic Chemists Suppliers’ Day.

As CEO of P2 Science Inc., Burns spends much of his time developing and patenting intellectual property around new products and new process technologies used in making those products.

“In fact, that really is a linchpin for our business,” he told Happi. “As a relatively new start-up, we need a strong patent portfolio to protect ourselves as we enter the global markets alongside some multinational, multibillion-dollar companies.”

For surfactant suppliers looking to grow, going global today is the only way to go.

Looking for a new surfactant? A list of them begins on the following page.

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New Surfacants

Here is a list of new surfactants introduced by industry suppliers within the past 12 months. For more information on any of the products listed here, contact the companies directly using the contact information provided.

BASF Corporation
Florham Park NJ
Tel: 800.962.7831
Email: [email protected]
Website: www.personal-care.basf.com/?utm_source=HAP&utm_medium=ContentMarketing&utm_campaign=HAP
Plantapon TF
Description: Decyl glucoside (and) polyglyceryl-10 caprylate/caprate (and) coco glucoside (and) glyceryl oleate
Applications: Ideal for baby care products such as shampoos and washes.
Use levels: ~20%
Comments: Extremely mild tear-free and sulfate-free surfactant blend based on APG technology.
plurafac lf 900
Description: Fatty alcohol alkoxylate
Applications: Excellent for use in rinse aid formulations, auto dishwashing detergents, ware washing detergents and rinse aids, HE liquid laundry formulations, and high pressure hard surface cleaning formulations
Use levels: 15-30% (application dependent)
Comments: Designed to provide a balance of defoaming and wetting properties in applications that encounter intensive mechanical action such as auto dish and ware washing products.
Rheovis AT 120
Description: Methacrylic acid/acrylic acid copolymer, modified
Applications: Liquid laundry detergent, manual dish detergent, hand soaps and alkaline surface cleaners Use levels: 0.1-1.0% (application dependent)
Comments: Provides multiple benefits based on its high thickening efficiency, improved rheology profile (shear thinning) and its ability to be post-added in a typical manufacturing process.

Croda Inc
Edison, NJ
Tel: 732.417.0800
Email: [email protected]
Website: www.croda.com/homecare
Crodasol WS
Application: Wide-spectrum fragrance solubilizer for aqueous systems
Use levels: up to 3%
Comments: An effective low-dosage, fast dissolving universal fragrance solubilizer, well suited for product classes where low levels of surfactant are used. Solubilizes a broad range of fragrance classes in water-based systems.
ModiSurf Clarity
Applications: Bathroom/shower cleaners, glass cleaners, multi-purpose cleaners
Use levels: up to 3%
Comments: A new additive for hard surface cleaners. Forms a protective layer on glass and polymeric surfaces, which repels limescale and reduces the tendency of surfaces to fog up. Can be formulated into a wide range of products. Biodegradable and made from 60% renewable materials. Patent pending.

Evonik Goldschmidt Corp.
Hopewell, VA
Tel: 800.446.1809
Website: www.evonik.com/household-care
Rewoquat WE 45
Description: TEA ester quat
Applications: Fabric softener
Use levels: 3-20%
Comments: Room-temperature dispersible ester quat.

Rhodia
Cranbury, NJ
Tel: 888.776.7337
Email: [email protected]
Website: www.rhodia.com
Mackam BC 39
Description: Cocamidopropyl betaine, cocamide MEA
Applications: Shampoos, liquid hand soaps, body washes, bubble baths and bath gels
Use levels: 2-8%
Comments: Mackam BC 39 is a cocamide MEA-based, liquid amide. It is designed for easy dispersion at ambient temperatures. Mackam BC 39 should be added slowly to a batch with moderate agitation to boost foam and build viscosity. This liquid CMEA concentrate is preserved with DMDM hydantoin.
Mirasheen SSE
Description: Sodium C14-16 olefin sulfonate, glycol stearate, cocamidopropyl betaine
Applications: Shampoos, liquid hand soaps, body washes, bubble baths, bath gels
Use levels: 3-12%
Comments: Mirasheen SSE is an amide-free liquid pearl agent designed for easy dispersion at ambient temperatures. Mirasheen SSE should be added slowly to a batch with moderate agitation to obtain attractive pearlescence and stability. The amount of Mirasheen SSE will vary from 3% to 12% based on pearl effect desired. Mirasheen SSE is exceptionally easy to handle at low temperatures as it becomes thinner below room temperature. This liquid pearl blend is glycol stearate based and is free of formaldehyde and paraben.
Mackamide CPA
Description: Cocamide MIPA
Applications: Shampoos, liquid hand soaps, body washes, bubble baths, bath gels
Use levels: 0.2-1%
Comments: Mackamide CPA is a 1:1 coconut monoisopropanolamide that is 100% DEA and MEA free. Ultra pure and optimized Mackamide CPA provides enhanced viscosity response and foam stability. Mackamide CPA has very low residual reactants and by-products making it ideal for natural formulations.

Stepan Company
Northfield, IL
Tel: 800.745.7837
Email: [email protected]
Website: www.stepan.com
Steol CS-270 C
Description: Sodium laureth sulfate, 2 moles EO
Applications: Detergents, dishwash, laundry, liquid hand soap, industrial cleaners, shampoo.
Use levels: 5-20%
Comments: This product is listed on www.cleaningredients.org and meets the DfE screen for surfactants. It is citrate-buffered.
Stepanol WA-Extra HP
Description: Sodium lauryl sulfate
Applications: All-purpose cleaning, bar soap, body wash, carpet/upholstery cleaning, facial cleansers, hand dishwashing, hard surface care, laundry, light duty cleaning, liquid hand soap, shampoo.
Use levels: 10-35%
Comments: This product is high pH preserved.

TRI-K Industries
Denville, NJ
Tel: 973.298.8850
Email: [email protected]
Website: www.tri-k.com
TRIglyphix Sense
Description: Hordeum vulgare seed isolate (proposed)
Applications: Skin care, sun care
Use Levels: 2-5%
Comments: Proven to help reduce redness and irritation, while increasing collagen, elastin & hyaluronic acid synthesis.
Quinoa Pro EX
Description: Hydrolyzed quinoa
Applications: Skin care, hair care
Use levels: 1-10%
Comments: Hydrolyzed quinoa protein with high amino acid content for nourishment and moisturization of the hair and skin
Rice Pro-Tein BK-G
Description: Hydrolyzed rice protein
Applications: Skin care, hair care
Use levels: 1-10%
Comments: Soluble, cosmetic-grade, vegetable protein derived from rice bran. Gluten-free.