Surfactant Companies Offer Solutions
After a questionable study by the National Toxicology Program linking cocamide DEA to cancerous tumors in laboratory mice, surfactant suppliers are offering alternatives to this widely-used personal care surfactant.
C ocamide diethanolamine's potential danger may be the biggest issue facing the surfactant industry at the moment, but it is by no means the only issue. Surfactant suppliers continue to introduce new products and build new plants in the U.S. and abroad to meet the needs of the household, personal care and industrial and institutional industry.
But one thing is clear, the cocamide DEA controversy demonstrates that the surfactant industry knows how to handle a crisis. After the technical reports review subcommittee of the National Toxicology Program issued data late last year that showed a possible link between cocamide DEA and carcinogenic activity in female rats, the industry responded quickly with a host of alternatives for the widely-used personal care surfactant.
"I'm sure at some point it will quiet down and be investigated scientifically," predicted Steve Scher, president, Scher Chemicals, Clifton, NJ. "Nonetheless people reacted when the issue was broadcast by CBS."
After that February broadcast on CBS This Morning, surfactant suppliers rushed to defend their products while at the same time offering solutions to companies that may wish to formulate around the cocamide DEA debate. Not that the industry is backing down from NTP's accusations. Several industry observers noted that there may have been flaws in the NTP study. For one thing, it was based on a single strain of laboratory mice, specially-bred for their tumor susceptibility.
Furthermore, the material has been widely studied in the past and as the current Cosmetic Ingredient Review expert panel guidelines point out, "Cocamide DEA is safe as used in rinse-off products and safe at concentrations up to 10% in leave-on cosmetic products. Cocamide DEA should not be used as an ingredient in cosmetic products in which N-nitroso compounds are formed."
On Feb. 26, shortly after the CBS This Morning segment, the Food and Drug Administration issued a fact sheet stating, "the Agency believes that at the present time there is no reason for consumers to be alarmed based on the usage of these ingredients (diethanolamines) in cosmetics." According to sources, FDA has put cocamide DEA and the NTP study on a "fast-track" review, but at press time, no results had been announced.
"The marketplace has overreacted to the published information regarding the safety of DEA in amides," said Ernest Randolph of DeForest Enterprises, Boca Raton, FL. "If this trend continues, all amines will be under this type of scrutiny." Mr. Randolph told happi that there is also some question as to whether or not marketers are willing to pay for higher priced, non-DEA amides.
Until there is more news, some industry executives said they are concerned that the cocamide DEA issue may mushroom. "We have not experienced any short-term business disruptions but we may see a problem in the future," noted Nick La Magna, marketing manager, detergents, personal care and I&I for Huntsman, Houston. He said Huntsman has other amide chemistry for customers to choose from and added that the company continues to work with the Chemical Manufacturers Association and other groups to better educate the public about the issues.
Mona Launches Promidium
Many other surfactant suppliers are touting alternatives to cocamide DEA. Perhaps the most aggressive alternative program has been developed by Mona Industries, Paterson, NJ. At a press conference held prior to last month's Society of Cosmetic Chemists Supplier's Day, in Secaucus, NJ, Mona executives introduced Promidium surfactants, a new class of liquid nonionics for use in personal care products. Promidium products contain no mono- ethanolamine, diethan-olamine or secondary amines. Although Mona could not have timed the introduction better, company executives insisted they have been working on Promidium for years.
"About 10 years ago we began a research and development effort aimed at improving this widely used class of chemistry," explained Jay McAndrews, president of Mona. "During that time we developed dozens of products that were better, in one fashion or another. But we always held back from putting them on the market, because we felt, internally, that we hadn't gotten them right. Now, we've got it right."
Mona maintains that it conducted numerous tests comparing the performance of the three Promidium surfactants with traditional liquid alkanolamide surfactants such as cocamide DEA and lauramide DEA. In every test Promidium offered equivalent or better performance in the critical areas of foam boosting, foam stabilization, viscosity control and wetting. Furthermore, Promidium surfactants are liquid, compatible with nearly all traditional personal care ingredients and are used at similar concentration levels as standard alkanolamides.
"Promidium surfactants have near 'drop-in' performance," said Dennis Fost, Mona's vice president, business development. "This is a big advantage to formulators, since they will not have to create completely new production procedures." Dr. Fost also noted that existing formulations will not have to be entirely re-worked to compensate for a wide fluctuation in performance and existing facilities and equipment can be used without modification. "Promidium surfactants enable our customers to reformulate once, quickly and economically," Dr. Fost concluded.
Other Alternatives Offered
Other companies have also been dealing with the cocoamide DEA issue and several are offering their own solution to the problem. Mr. Scher noted that his company addressed the issue several years ago in the metal working industry, which is closely monitored by the United Auto Workers union. "We're looking to reduce DEA or develop one-to-one substitutes such as MEA or monoisopropanolamide (MIPA)," said Mr. Scher. "These materials are more expensive at the moment and they are solids, which makes them more cumbersome, but we have a lot of experience with this issue in other industries. We just have to find a solution suitable to the cosmetic industry." With its large surfactant position in Europe, where the cocamide DEA issue has simmered for years, Albright & Wilson has developed a complete range of alternatives, noted Carolyn Covey Morris of Albright & Wilson. "Fortunately, there are substitutes for these products in the form of amphoacetates, betaines, monoethanolamides and ethoxylated monoethanolamides and other carboxylates," said Ms. Covey Morris. "All of these products are easy to handle and frequently offer benefits not found in diethanolamides."
For personal care manufacturers that want to reformulate around cocamide DEA, Witco markets the Rewoderm/Varonic LI series of glycerol esters. "These materials improve the creaminess of the foam in hair and shower shampoos and leave a pleasant and smooth skin feel after washing," said Jeffrey Walton, business manager, Witco, Greenwich, CT. "They are an excellent alternative to coco-DEA and they are non irritating, non-sensitizing, mild and offer good thickening properties. Furthermore, they are also good solubilizers for perfumes."
Although Pilot Chemical manufactures cocamide DEA, Neil Burns, vice president of marketing, insisted the controversy has had some positive effects for the company. "About 10 months ago we introduced Eucarol alkyl glucoesters. They are mild, high foaming surfactants that have similar functions of the cocamide DEA, but Eucarol is a much more exciting chemistry."
Croda has been active during the cocamide DEA controversy, too. The company recently published an Alkanolamide Replacement Guide which provides details on formulating alternatives.
Norman, Fox & Co., Vernon, CA, offers two DEA replacements. Norfox DCSA-N is a coconut oil-based amide with no free DEA. Norfox DGCA is billed as a non-DEA "drop-in" for conventional amides.
Expansion Abounds Overseas
Observers note that U.S. demand for surfactants is rising only modestly, while price pressure at the retail level has restricted raw material suppliers' ability to raise prices. These market conditions have, in recent years, forced some suppliers out of the market. Despite this climate, some manufacturers continue to thrive in the U.S. Elsewhere, demand for more sophisticated formulas is driving Latin America and even Asia is presenting growth opportunities.
Croda, for example, will commission a new, fully-integrated plant in Singapore in July, 1999. "It will triple the capacity of the current manufacturing facility and increase our product range in that region," said Penny Venamon, marketing manager, hair care. Croda is also building a specialty alkoxylates plant in the UK which will significantly increase production capacity.
Expanding in Malaysia
Although some multinational consumer product companies have reported sales declines in Asia as a result of the region's recent economic problems, that hasn't deterred Witco and Union Carbide from expanding in Malaysia.
"Parts of Asia may be having economic problems, but it remains an important part of our business," noted Mr. Walton. "In fact, we are expanding in the region with a new oleochemical derivatives facility in Malaysia."
The new Witco plant will manufacture consumer and functional surfactants for sale and distribution throughout the Asia/Pacific region. According to Witco, the plant is expected to begin operations in the fourth quarter of 1999. Company executives maintain that the plant will manufacture the most advanced consumer and functional surfactants using locally available, renewable resources.
"We are not backing away from Asia," agreed Hazel Kreuz, marketing manager, Union Carbide. "Economic issues that have slowed growth in that region will be successfully addressed in time." Ms. Kreuz said Union Carbide's new Malaysian surfactant plant, which will manufacture Triton and Tergitol surfactants, will begin production in 2001. In the U.S., Union Carbide's surfactant plant in Taft, LA, is scheduled to come on-stream later this year.
3M manufactures Fluorad fluorosurfactants, which are primarily used as additives in household products and industrial applications. According to Judith Dow-Grant, marketing manager, 3M Performance Chemicals & Fluids division, sales of these products have not been affected by the Asian crisis. Furthermore, said Ms. Dow-Grant, Latin America continues to be an area of growth for 3M fluorosurfactants.
U.S. Expansion Plans
The sheer size of the U.S. market makes it impossible to ignore growth opportunities in the states and several companies recently announced expansions. Perhaps the most dramatic was ICI's announcement in May that it was acquiring Mona Industries for an undisclosed amount. Mona's annual sales, according to reports, are around $45 million.
"Mona fits very well with ICI's strategy of building a network of platforms to help solve a customer's problem," said Craig Aiken, Americas business manager, household, ICI Surfactants. "We're building a global company and Mona has some very interesting technologies."
Last year, ICI acquired several businesses from Unilever including National Starch & Chemical, Unichema International and Quest International. Mr. Aiken said these acquisitions, along with Solaveil and ICI's existing surfactant business, all play an important role in the ICI personal care network.
Mr. Aiken said there are no plans to make any changes at Mona. "This acquisition isn't about cost reduction. It's about expanding business. Mona is doing very well by themselves. We want to be very careful about the way we put things together."
ICI has also been expanding existing facilities. Later this year an alkoxylation facility in New Castle, DE will become operational. On the product side, ICI launched Arlacel P series, a new range of high performance polymeric emulsion stabilizers and Arlatone MAP Concentrate. "MAP moved us into the specialty cleansing segment and both products have done very well in the marketplace," noted Mr. Aiken.
Janice Mabe, business manager, alkylates, Huntsman, called surfactant demand growth in the U.S., "almost surprisingly strong." This strength, she said, has been attributed to many events: more casual clothes in the workplace, more washloads per household, overdosing of compacts and pantry buildup due to a high level of consumer confidence.
Similarly, J. Fred Buether, market development, Dow Corning, said growth has remained strong for Dow Corning's specialty surfactants for household and personal care products. "However, it is certainly fair to say that sales were not helped due to the strength of the U.S. dollar in relation to Asian currencies."
Growth in Latin America
Ms. Mabe reported that Huntsman's surfactant sales have also been strong in Latin America. "It is a growth region for the foreseeable future and an important market for Huntsman," maintained Ms. Mabe.
Tom Frazier, senior market manager, Dowfax surfactants, Dow Chemical, noted that Latin America, particularly Mexico, Brazil, Argentina, Colombia and Chile, has been a growth region for quite some time for Dow.
"Latin America has been and will remain an area of focus for us," said Chuck Utberg, vice president, marketing, Burlington Chemical. "Pricing on specialties meets more resistance in Latin America than in the U.S., but as technology there increases, resistance should diminish." Burlington Chemical is investigating a joint venture in South America. "Goverment and monetary policies have stabilized and good potential exists for our products," said Mr. Utberg.
Another Record Year for Stepan
Back in the U.S., Stepan recorded its third straight year of record sales and earnings in 1997 due to the strong growth in its North American surfactant market. Last year the company acquired the west coast surfactant business of Lonza, integrated it into its existing surfactant plant in Anaheim, CA and, as a result, significantly increased productivity at the site. Elsewhere, Stepan opened an office in Brazil.
Albright & Wilson also expanded in the U.S. with the acquisition of the Blue Island, IL surfactant manufacturing facility. "Sales have increased dramatically in the past six months," noted Ms. Covey Morris. "Although Blue Island accounted for much of that growth, growth has also come from the transfer of new technology from our European operations."
In the U.S., Witco has just completed the first year of a three-year restructuring program. "We are streamlining manufacturing from 46 plants to 31 and our strategy is to become less focused on commodity surfactants and more focused on specialty surfactants," said Mr. Walton. He noted that amphoterics are the fastest growing segment in the surfactant industry due to strong consumer demand for low-irritation products. "Our amphoterics are based on renewable resources and have very low impurity levels."
Mr. Burns told happi that Pilot will invest at least $10 million in capacity sulphonation and sulfation expansions this year. In another move Pilot acquired Olin Chemical's disulfonate business. According to Mr. Burns, the acquisition was a great fit for Pilot. "Olin's products are similar to our chemistry," said Mr. Burns. "You couldn't ask for a better fit."
More than a year ago, Pilot formed a partnership with Lamberti, an Italian surfactant manufacturer. "It's our model for future growth overseas. It's an efficient way to expand globally," explained Mr. Burns, who added that Pilot is in negotiations with other companies outside the U.S. and will probably announce another partnership in Europe or Asia by the end of the summer.
Hideaki Fujioka, of High Point Chemical, told happi that his company is planning new capacity for surfactants in Japan, Asia and the U.S. Meanwhile, Burlington Chemical will complete phase two of its synthesis plant by the fourth quarter.
Condea is involved in a series of debottlenecking projects to increase its worldwide fatty alcohol production capacity by 120,000 metric tons by 1999. The projects are located at Condea Vista's alcohol unit in Lake Charles, LA; Condea Chemie's alcohol facility in Brunsbüttel, Germany and Condea Augusta's plant in Augusta, Italy. In addition, the company will add new LAB capacity in Augusta, although the company stressed that the new capacity will not add to Condea's current overall world LAB capacity.
Partnerships a Plus
But no matter where their operations exist, suppliers are increasingly taking a one-on-one approach with their customers to help solve their formulation problems. "Albemarle partners with select customers to help them achieve their business goals," said Fred Perkins, business director, surface actives. "We have about 150 customers and partner with a dozen of them," he explained. "It enables us to offer customized solutions to a marketer's problems." Last year, Albemarle's surfactant sales rose 12-15% to $150 millon and Mr. Perkins said the company will grow even faster this year due to more profitable partnerships. He said many marketers want to reduce their research and development costs and Albemarle can provide in-depth chemical analysis, do all the preliminary work and optimize formulas to help customers solve their cleaning problems.
"We're the only manufacturer of single-chain amine oxides," added Bob Kuhlmeier, market manager, cleaning for Albemarle. "These single-chain molecules enable us to deliver the exact performance a customer demands."
The Albemarle executives noted that many marketers are interested in making biocidal and disinfectant claims. Albemarle offers FIFRA-registered biocides and surfactants that are synergistic and enable marketers to make strong performance claims.
Finished Product Trends
Demand for multifunctional systems is also propelling Dow Chemical's business. In the household and I&I cleaners market, according to Mr. Frazier, interest in hypochlorite-based cleaners has triggered the need for multifunctional surfactants capable of bringing stability to bleach-based formulas, along with fragrance coupling and other properties. "The Dowfax family of anionic surfactants can provide this multifunctionality and we expect the need for these multifunctional surfactants to grow."
Even as surfactants become multifunctional, the household cleaning market is also becoming more segmented. "Segmentation to solve specific problems will continue," predicted Marvin Matises, president of Galileo Idea Group, a company that develops new product ideas based in Naperville, IL."For example, Woolite markets carpet care products for stains and another to get out grease," noted Mr. Matises. "In the dishwashing category, Colgate-Palmolive now offers a cleaner for pots and pans. Marketers will continue to segment categories into more narrow areas. The question is, can highly segmented ideas be profitable? As products become segmented to solve a problem, I wonder if there is a big enough consumer base to support that specific need."
Convenience is another driving trend in the household cleaning segment, according to Mr. Matises. "It's prevalent in other industries and we're beginning to see it in household cleaning products." Benckiser's 1997 introduction of Electrasol dishwashing tablets is one example of a more convenient product form. And just last month Unilever began selling Persil laundry tablets in the UK. The product debuted in France and Greece in April under the brand name Skip.
The round tablets are prepacked in pairs and are available in 24- and 48-tablet boxes. According to Unilever, Persil Tablets took seven years to develop. "Our tablets dissolve evenly and thoroughly all around the wash and yet are strong enough to stay in one piece during the journey from factory to supermarket to kitchen," said Helen Fenwick, a company spokesperson.
Unilever executives predicted that within two years tablets will grab a 20% share of the $1.67 billion U.S. detergent market. Not to be outdone, Procter & Gamble is said to testing Ariel Discs in Grimsby, a town in northern England. Tablet-shaped detergents haven't made a big splash in the U.S. yet, but another European idea, high-efficiency washing machines, is beginning to catch on in a big way. These machines require less energy to run since they are smaller and use less water at cooler temperatures.
A year ago, Procter & Gamble and Lever Brothers began producing specially-formulated laundry detergents for these high-efficiency machines. Last month, Lever's Wisk HE rolled out nationally. The company noted that the popularity of these front-loading washers is growing significantly, which should propel demand for the specially formulated detergents.
Lever executives wouldn't comment on Wisk HE sales, but they did say segment growth should mirror sales of high-efficiency washers. Last year, high-efficiency washers accounted for 3% of washer sales and industry observers expect the machines to grab 7% of new washer sales this year.
High efficiency or not, Ron Swantkowski, Condea Vista's vice president, detergents and surfactant intermediates, credited the rise of liquid laundry detergents for helping surfactant sales increase. "LAB has grown at a rate of 3-4% and ethoxylate sales have been similarly strong," said Mr. Swantkowski. "Demand continues to be consistent and has not been falling off."
Consistent demand in the U.S. and Europe, new technologies and growth opportunties in Latin America should be enough to help surfactant suppliers overcome any problems caused by Asia's economic crisis or a fallout from the cocamide DEA controversy.