ISDC 2011

INAUGURAL SESSION

Double digit growth in Indian home & personal care markets set to continue
fter two successful conferences in Goa in 2005 and 2008, the 3rd International Conference and Exhibition on Soaps, Detergents & Cosmetics (ISDC 2011) was held in Mumbai from 11-13 December 2011, at Nehru Centre, Worli. The event was jointly organized by the newly formed, Indian Home & Personal Care Industry Association (IHPCIA), and the Oil Technologists Association of India Western Zone (OTAI-WZ). Dynamics of Changes was the theme of the conference in which speakers from various segments of the home and personal care industry highlighted sustainability initiatives and programmes, as well as the significant growth expected in markets in developing countries. International exhibition Leading industry players in raw

materials, equipments, technologies, services and a variety of home and personal care products displayed their offerings in a well-laid out exhibition on two floors at the venue. The Basic Chemicals, Pharmaceuticals and Cosmetics Export Promotion Council (Chemexcil), Ministry of Commerce, Government of India, also organized a Reverse Buyer Seller Meet in which leading exporters participated. Choice of Mumbai appropriate The event, attended by over 300 delegates from India and abroad, started on 11 December, with the inauguration of the technical sessions and exhibition. The main conference was formally inaugurated the same evening by Chief Guest, Mr. Chandrashekhar Oak, Collector and District Magistrate, Mumbai City District, Government of Maharashtra.

DR. AJIT JOSHI drjoshi@chemicalweekly.com In his inaugural address, Mr. Oak pointed to the importance of Mumbai as the financial capital of India and headquarters of several leading Indian and global home & personal care companies. He highlighted the significant growth of the home and personal care products industry, as well as raw materials production, especially in the past few decades, and expected double digit growth during coming years. Mr. Oak also solicited the industrys support to the government for joint efforts to realize the dream of environment-friendly and sustainable high growth in coming years. Mr. N.B. Godrej, Chairman, Steering Committee, ISDC 2011, in his inimitable style delivered a poetic address at the inaugural function! Dr. B.R. Gaikwad, Conference Chairman; Mr. Sanjay Trivedi, Conference Convener; Mr. M.K. Janardan, President, OTAI-WZ; Dr. R.B.N. Prasad, President, OTAI; and Dr. Rajeev Churi, Conference Secretary also presented their views on the event, the current status of the global and Indian home & personal care industry, and its growth potential.
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Dignitaries in the inaugural session Chemical Weekly January 17, 2012

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KEYNOTE ADDRESSES

Sustainability & innovation will drive growth; but economics will reign supreme
The first day of the conference had a strong emphasis on sustainability and innovation as key drivers of growth with speakers addressing technical and business approaches to the issue. Time-bound commitments at Unilever Mr. Pradeep Banerjee, Executive Director Supply Chain, Hindustan Unilever Ltd., presented the business case on sustainable growth and the plan followed by Unilever, which has identified 50 time-bound commitments to attain the goal of sustainability for raw materials. The plan aims to double the size of the business, while reducing impact on the environment; halves the environmental imprint of products; and aims to source a significant portion of raw materials from agricultural sources by 2020. Mr. Banerjee reviewed the environmental concerns about increasing palm oil production, especially those related to deforestation of tropical forests, and described various measures, such as the Roundtable on Sustainable Palm Oil (RSPO), undertaken to make palm oil production sustainable. Make products safer by design Prof. G.D. Yadav, Vice-Chancellor, Institute of Chemical Technology, Mumbai, pointed to the key role of chemicals and chemistry in meeting societal needs, and noted that the many challenges
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to sustainability can be met by the right inputs of chemistry. Green chemistry, he added, comprises of twelve elements, of which three atom economy, use of catalysts and using renewable feedstock for making chemicals are especially important. A study of the relationship between structure and toxicity of chemicals, he pointed out, can lead to design of safer chemicals. Using modern advances in molecular toxicology, catalysis and renewable raw materials, we can build the foundation for change towards sustainability. Prof. Yadav detailed various safer chemicals design strategies such as use of isostearic replacement, substitution of carbon (C) atom by silicon (Si) etc. Many commercial chemical synthesis processes, he added, have been modified to make them green, by having less number of reactions steps, using renewable raw materials, use of efficient catalysts etc. As examples, he cited the green citral process of BASF; stereo-

selective hydrogenation of p-tert-butyl phenol over Rh/C; synthesis of triclosan using phase transfer catalyst; synthesis of yara yara using modified clays as catalyst; air oxidation of benzyl alcohol to benzaldehyde; hydrogenation of styrene oxide to obtain kevda-type perfumery chemicals etc. Sustainable green chemistry can be used to make platform chemicals like glycerol, which can be converted into many different useful derivatives, he added. Technology key to achieving sustainability Mr. Steve Stilliard, Vice President, Huntsman Performance Products APAC, presented sustainability trends in household and personal care products, especially with reference to nonionic surfactants. In his view, in the current situation of increasing costs and decreasing prices of consumer products, technological developments based on innovative chemistry are central to attain sustainability. Mr. Stilliard also dwelt on sustainability initiatives in organizational management. Relevant and topical management philosophy, proximity management with development of local talent and minimizing logistics footprint are important to attain success, he pointed out. Customer reluctance to pay Mr. Hans Juergen Scholz,
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Prof. G.D. Yadav being felicitated by Dr. B.R. Gaikwad

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Clariant, pointed out that although consumers and various non-government organizations are driving increasing use of renewable materials, consumers are not ready to pay a higher price for such products. He hoped that with newer and better technologies the trend towards renewable bio-based chemicals will gain momentum. The new technologies, many of which are being tested at pilot scale today, can reduce specific energy and water consumption, reduce carbon dioxide footprint and do not compete with food materials. But, he warned, success will only come if they enable to manufacture of products that are competitive in cost and performance with petrochemicals-based products and require comparable capital investments. The flexibility imperative Mr. F. Quinn Stepan, Jr., President & CEO, Stepan Company, stressed the MARKETS need for industry to develop security and sustainability of supply with collaborative partners, and develop infrastructure to support alternative options. The supply of critical raw materials can be ensured through collaborative partners, he noted. According to him, sustainability targets reshape product form and sourcing requirements. The prepared organizations will succeed and developing strategic partnerships will enhance the flexibility of the organizations, he added. Exploiting synergies Dr. B.K. Mishra, India Glycols, outlined changes in properties that take place when mixtures of ionic and nonionic surfactants are used. When mixed together, surfactants can undergo either synergistic or antagonistic reactions. For example, when cationic and anionic surfactants are mixed together they form double chain surfactants, with different shapes and visco-elastic properties, enabling creation of formulations with tailored properties and performance. He presented many examples of green surfactants like sugar fatty acid esters, seed oil ethoxylates, 2-ethylhexanol ethylene oxide-propylene oxide condensates, glycereth-2-cocoate, PEG-4 rapeseed oil amide, glycereth7-caprylate/caproate, sorbitan esters of various fatty acids etc. Comparing petroleum-based routes for producing chemicals with bioroutes, he presented the example of sodium lauryl ether sulphate (SLES). Bio-based SLES, where the ethylene oxide is made from ethylene derived from ethanol produced from sugarcane molasses, has a 30% lower carbon intensity compared to its petrochemical equivalent.

Growing disposable income & favourable demographics to drive spends in home & personal care products
The home and personal care industries are reaping the benefits from the countrys demographic dividend. The number of people in the middle class is expected to increase dramatically by 2025. Additionally, the disposable income of this middle class is expected to increase substantially. This will be helped further by increasing urbanization. On the basis of the urbanization rates of 2008, it is estimated that the five states Tamil Nadu, Gujarat, Maharashtra, Karnataka and Punjab are likely to be more than 50% urbanized. Dominant consumer themes in the personal care industry include:
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Emergence of the mastige segment (giving benefit of prestige brands at mass market prices); The slow, but steady, entry of modern retail formats (hyper- and supermarkets);

The emergence of the metrosexual man as a potential market (increasing male consciousness towards wellness and grooming); The recognition that while there is one urban India, there are many rural Indias (urban India merging into homogeneity, with rural regions demanding customized regional marketing). Personal care outpacing home care Mr. U. Shekhar, Managing Director, Galaxy Surfactants, estimated the Indian home and personal care products industry at about US$8-bn in 2010, and projected it to reach a size of US$11.19-bn in 2014. While personal
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care products [bath & shower products (including hand & face wash), skin, hair & oral care] constitutes 82% of this market with a value of US$4.90bn, home care products [fabric care and dish wash products] constituted 18%, valued at US$3.10-bn in 2010. From a growth perspective, the personal care segment is seeing annual growth of 10-15% almost double that seen in the home care segment (5-8%). While the shampoo market in India has grown 20 times in the past 20 years, about 70% of shampoo is still sold in sachets. Similarly, the face wash market is growing albeit from a very small base while skin lightening is the abiding theme in skin care products. Added attributes like moisturisation, sensory feel and young-looking skin are driving premiumisation of skin care products. In oral care products, there is an increasing popularity for toothpastes for sensitive teeth, while in fabric care, with increasing use of washing machines, use of compact detergents is growing. Increasing penetration and growth Dynamic growth is seen in every category and segment of home & personal care products. There is an increasing share of the wallet for better products. There are opportunities to increase market penetration, as well as consumption of various personal care products in the developing markets, Mr. Shekhar noted. According to him, products with basic functionality will drive penetration, while new, innovative products with added benefits and multi-functionality will drive growth. For example, a shampoo which satisfies the basic function of cleansing hair will drive market penetration, while shampoos with
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Mr. U. Shekhar speaking at the conference

added hair conditioning and repairing benefits will drive growth. Two distinct markets Prof. Rajan Kamat, University of Cincinnati, USA, pointed out that emerging markets have two distinct segments high end or premium markets and mass markets. While the former are characterized by low volume, branded products, the latter have large volumes, but rock-bottom prices. According to him, margin enhancement is the crux of business, but is an approach neglected by academics and management consultants. Tapping the dormant knowledge-base of the companys workforce will lead to significant margin enhancement, he noted. Opportunities & challenges in marketing fragrances Although market positioning, segmentation, brand variations & extensions and niche products are important in consumer marketing, the culture of the consumer needs to be understood correctly before trying to market a product, such as a fragrance, pointed out Mr. Sitaram Dixit, Oriental Aromatics.

According to him, there are significant regional variations in fragrance preferences even in India. While woody or sandalwood-type fragrances are more popular in south India, floral fragrances are preferred in the north. In western India, in contrast, fruity, floral and modern fragrances are preferred, while in the east floral bouquets are popular. The liking for a fragrance is so diverse geographically that a marketing strategy successful in one region may not work that successfully in another region. Consumer lifestyles have to be taken into consideration while marketing a fragrance product, he observed. Globalization of a fragrance, with one fragrance selling well in all regions of the world, is extremely difficult, he added. While there can be change in consumer behaviour, Mr. Dixit believed it is never dramatic, but gradual. Limited ingredient palette Mr. Dixit also pointed out that no radically new fragrance has been created for some time. Today, new fragrance products are just modifications of old ones. The ingredients palette, i.e.,
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the number of basic fragrance chemicals and materials, is declining. The use of natural plant oils (essential oils) for fragrance creation is decreasing. At the same time, hundreds of plants useful for making fragrance materials, are yet to be commercially exploited. Dynamics of skin care Mr. Jatin Bhatt, Vice President Business Development & Marketing, Cavin Kare, pointed out that prior to 2000, there was very low consumer awareness about skin care products in India and only very basic products like cold creams, petroleum jelly and antiseptic creams were available in the market. Even toilet soap was consiTable 1 Skin care products & market sizes [2011] (Rs. Crore) Product category Market size Face care 2,879 Moisturizers 2,332 Cleansers 259 Face masks 144 Anti-ageing 86 Toners 58 Body care 392 Total 3,272
Source: Cavin Care

dered to be a part of skin care, he noted. In contrast, in 2011, the skin care products market in India is estimated at about Rs. 3,270-crore and growing at 19% per annum. Of the 2,200 new home and personal care products launched during 2009, 75% were in the make-up, skin care and personal hygiene categories. Table 2 Penetration of select home & personal care products in India [%] Category Toothpaste Shampoo Skin cream Toilet soap Detergent bars Washing powder Dish wash
Source: Galaxy Surfactants

Mr. Bhatt estimated the personal care market in India at US$5.6-bn in 2008, and growing at a CAGR of 11.5%. By 2013, he expected the market to reach a size of US$9-bn, with growth continuing at an impressive CAGR of 10%. Increasing population, disposable income, awareness of personal grooming and modernization of organized retail trade are driving factors for growth in personal care products, he added. Mr. Bhatt pointed out that the top five industry players have 76% of the total market for skin care products, while others (about 150) account for the balance 24%. According to Mr. Bhatt, in future, new products will be launched to cater to the needs of rural consumers and to cater to specific consumer demands and age groups. Rising number of women in full time employment has created a large consumer base with sufficient disposable income and need for beauty products, which will drive growth in personal care products, especially skin care, he noted. Mr. Bhatt also expected premium products to gain momentum, with global products entering the Indian market. The Black Swans According to Mr. Sanjay Sriniwas, ITC, consumer trends which will impact businesses tomorrow include cosmetic dermatology, use of natural ingredients, concepts of wellness etc. The Black Swans, i.e., the opportunities the industry will need to anticipate, include issues related to health & fitness; and growing social and environmental consciousness. Disruptive innovations like waterless showers and dry bath products may revolutionize the market, he added.
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2010 52 45 25 93 90 88 28

2015 65 52 40 95 93 92 35

Table 3 Indian home & personal care markets Sub categories 2010 CAGR [US$bn] 2010-14 [%] Personal care 4.90 Bath & shower incl. face wash & 1.85 10 hand wash Skin care 1.20 15 Hair care 0.85 10 Oral care 1.00 8 Home care 3.10 Fabric care 3.00 5 Dish wash 0.10 8 Total 8.00
Source: Galaxy Surfactants Chemical Weekly January 17, 2012

2014 [US$bn] 7.40 2.70 2.10 1.24 1.36 3.79 3.65 0.14 11.19

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INNOVATIONS

Sustainability, cost reduction & quest for product differentiation driving innovation
Sustainability has emerged as a very clear priority for all home and personal care products companies. This is likely to impact processing, packaging and product design. Intense competition and the need to stand out amongst a crowd are driving companies to invest significant resources in research and development. At times, this is being speeded up by regulatory trends related to product labelling and the need to reformulate to ensure use of safe and green ingredients. Raw material suppliers, such as surfactant producers, also need to respond to cost pressures from their raw material suppliers be it from the petrochemical value chain or from oleochemicals at times compromising on margins. New age of frugality Mr. Norman Ellard, CEO, Rohen Pte. Ltd., representing IPSpecialities Asia, noted that consumers have turned cautious and price conscious while buying personal care products in this new age of frugality. The economic recovery of the world will take another four to five years or even ten years. Demand for home and personal care products will continue to grow, most likely at GDP growth rate; but not at the pace we hope, he warned. As regards surfactants demand, he admitted that while per capita surfactant use in China and India is one-fifth of that in North America and Europe, and the growth potential is very high, several factors will impede this growth. High prices of natural raw materials (palm oil), as well as petroleum resources will result in expensive surfactants. This will cause reformulation, which is happening already. According to Mr. Ellard, innovation will be key to find the right solutions. Water availability or scarcity will be another key issue that will impact consumer habits, especially in home care, and also affect surfactant formulations. Innovation will lead to new products Dr. Farooq Alam, Associate Marketing Director, Dow Chemicals, outlined three trends sustainability, cost reduction and differentiation of products driven by convenience as driving innovation and markets in the homecare industry, including the detergents industry. Important focus areas of companies involved in innovation in fabric care products, according to him, include: Low temperature cleaning; Improved bleaching systems; Cleaning with less water; Use of bio-sourced and biotechnology-based ingredients and builder systems; Providing sensorial benefits, Colour & textile compatibility; Convenience (e.g., easy ironing), and Use of mono-dose systems. Innovations in these areas will lead to improved products, which will be more acceptable to the consumers, Dr. Alam added. For the Indian fabric and surface care markets, the focus, he added, is on foam modification, providing skin sensorial benefits, grease cleaning, better rinsing for water conservation and use of multi-purpose additives. Convenience and beyond According to Dr. Alam, the needs in fabric and surface care can be divided into two broad categories: convenience and beyond (including wellness, and environmental & social responsibility). The increasing disposable income of
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View of the audience

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consumers will support the market for convenience and wellness products, he noted. In hard surface cleaners, for example, while basic products offer just cleanliness; convenience products offer cleaning and additional convenience benefits like multi-purpose cleaning; while wellness products offer cleaning, convenience and wellness benefits. He also pointed to differences in innovation approaches in mature and emerging markets. In hard surface cleaners, for example, while developmental efforts for products in mature markets mainly focus on eco-friendly and convenience benefits, in emerging markets the emphasis seems to be on improved detergency, as well as providing anti-bacterial properties. Costs an important factor in choice of raw materials Dr. Thomas Greindl, Vice President Global Marketing, Home Care and I&I, BASF, pointed out that the detergents industry is grappling with several challenges, including coping with reduced availability of water and ensuring sustainability of products and processes. In developed countries, companies are focussed on addressing issues such as use of less water for washing; and ensuring optimal cleaning performance & fat removal at lower cleaning temperatures. There is a discernible trend PRODUCT INNOVATION He pointed to several new sustainable technologies and product platforms that have been developed by Akzo Nobel. For example, the company has introduced a new surfactant platform from naturally derived raw materials. One such product is Berol ENV226Plus, which offers cost-effective green performance benefits in fabric and heavy duty cleaning, while fulfilling EU Ecolabel criteria for all-purpose and sanitary cleaners. Lower carbon footprint of hybrid platforms Similarly, the hybrid platform offers unique plant-based alternatives to petrochemical-derived chemicals. Hybrid polymers, for example, are 60% based on renewable resources like corn, potato and tapioca starch. Akzo Nobel offers Alcoguard H5240 for use in laundry detergents, while the Aquatreat HP line can be used in scale inhibitors for water treatment. Tests on these hybrid polymers have shown performance similar to that of synthetics for parameters like anti-redeposition, antiencrustation and detergency. According to Dr. Pfaffernoschke, the hybrid technology has a potential reduction of about 1-tonne of CO2 equivalent per tonne of hybrid polymer used, as compared to synthetic polymers. The new hybrid polymers can offer the required performance with sustainability, he concluded.

Dr. Thomas Greindl

to super-concentrated formulations, and catalytic cleaning is coming to the fore. In contrast, in developing countries, the challenges include improved soil/fat removal; reducing scrubbing & crushing in hand wash; saving water; and suds control. Cost and availability, he added, are important criteria in determining choice of raw materials for surfactants be it of petrochemical or natural origin. Sustainability: a prerequisite for the future Dr. Matthias Pfaffernoschke, Business Head, Akzo Nobel (Europe), noted that sustainability rests on three pillars environment, society and economy which are interdependent, but essential elements.

Understanding fundamental science key to application development

Surfactants have a range of applications and are used in formulations where there is a need for mixing hydrophobic and hydrophilic substrates.
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These include paints, cosmetics, pharmaceuticals, nutraceuticals, textile dyeing, fabric care, floor cleaning, fuel additives, food additives, pesticides, etc.

Novel surfactant applications range from nuclear to solar energy, petroleum recovery, as well as emulsion polymerization processes.
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Understanding the fundamental properties of surfactants is key to discover new applications, as well as discover new materials for required applications, Prof. Sunil Bhagwat, Institute of Chemical Technology, Mumbai, noted. A microemulsion is a single phase system composed of water, a waterimmiscible oil, a surfactant and a cosurfactant which is optically isotropic and thermodynamically stable, but translucent or transparent to visible light. Nano emulsions appear similar to EMERGING RAW MATERIALS toxicity and are biodegradable and environment-friendly. Sophorolipids, a class of biosurfactants, have applications as anticancer, antibacterial, antiviral, spermicidal & antifungal agents, and also in enhanced oil recovery and detergents. Gemini surfactants, which are dimeric surfactants with low critical micelle concentrations, have many applications in detergents, cosmetics (shampoos, lotions), textile dyeing, polymerization, paints, corrosion inhibition, micellar catalysis and as antimicrobial agents.

microemulsions, but require more energy for preparation and are not indefinitely stable. Biosurfactants have lower

MES & MEE touted as replacement for LABS & fatty alcohol ethoxylates
Fatty acid methyl esters on sulphonation and ethoxylation yield methyl ester sulphonates (MES) and ethoxylates (MEE) that can find use in the home and personal care products industry as alternatives to more well established ones. But several challenges remain to their wider acceptability, including inertia of end-use customers to alter formulations without adequate comfort on long-term availability, pricing and performance. Technical challenges According to Dr. Corrado Mazzanti, Sales Director, Desmet Ballestra (Italy), colour inhibition during the multistep bleaching and ageing of MES is very critical to obtain light-coloured product a technological skill that has been patented by Desmet Ballestra. MES can be dried to powder, needles or granules, having different dry matter content and bulk densi194

ties, using a variety of options including wiped film evaporators and spray dryers. He noted that these powders have a caking tendency and addition of an anti-caking agent or hydrotrope is necessary. Alternatively, modification in granulometry of the dry MES can help to reduce caking.

Spray drying, he noted, is recommended if the production capacity exceeds 6-tph (tonnes per hour) to obtain light MES powder having high solubility. MES needles can be prepared by using extruders. Since LABS is the largest consumed anionic surfactant in detergents in Asia, replacement of LABS at different levels in the existing detergents formulations offers the greatest potential market for MES. According to Dr. Mazzanti, MES can replace LABS in the range of 20-70% in detergent formulations in Asia. Unlike LABS, MES performs well in hard water. Green MEE an emerging option Dr. George Smith, Huntsman Corporation, dwelled on the properties and performance of MEE. He pointed out that due to increasing awareness and drive for sustainability, the detergents industry is moving towards green surfactants derived from renewable raw materials.
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Since biodiesel (a methyl ester) derived from palm and other vegetable oils (such as soybean oil) are abundantly available today, these have been chosen by Huntsman for direct ethoxylation using proprietary calcium-based catalysts. For example, Surfonic ME 530 PS, based on C16-C18 methyl esters from palm oil, has been found useful in laundry detergents, hard surface COMMODITIES OUTLOOK cleaners and personal care products. For liquid laundry detergents, MEE such as Surfonic ME 550 SO, derived from soybean oil, has been found appropriate. Performance characteristics cloud point, surface absorption, surface tension, critical micelle concentration, interfacial tension, wetting times, foam potential, detergency, etc. of MEEs and conventional fatty alcohol ethoxylates are comparable, according to Dr. Smith. While short chain MEEs exhibit performance similar to alcohol ethoxylates, long chain MEEs show lower foam than alcohol ethoxylates. In textile cleaning, he noted, MEEs exhibit comparable detergency to alcohol ethoxylates.

No dramatic lows or highs expected for palm oil & crude oil prices
Mr. G. Chandrashekhar, The Hindu Business Line, attributed the increased volatility of raw materials used by home and personal care industry to varied factors like rapid demand growth, supply uncertainties, trade & tariff policy changes, geopolitical instabilities, currency dynamics and the sovereign debt crisis. In the short term, he expected twospeed growth in global markets weak and hesitant with high unemployment in the OECD region and strong, yet slowing growth, in emerging markets. Asia could be the silver lining with high growth. Commodity markets, according to Mr. Chandrashekhar, may become an increasingly important factor in setting the limit for growth. Supply of commodities is struggling to keep pace with rising demand. Investments in commodities may see regulatory restrictions in the near future. Strong connect between crude oil and vegetable oil He also saw a strong nexus between crude oil and vegetable oil markets, via biodiesel.
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At present, these markets are torn between worsening sentiment and constructive fundamentals. In the vegetable oil markets, there is expectation of tightening demand-supply fundamentals, strong biodiesel demand, and prospective slowdown in

palm oil output due to season factors. Mr. Chandrashekhar expected continued volatility in palm oil, but, he felt, prices may not rise much as in the past. No dramatic lows or highs are expected for palm oil, as well as crude oil prices.
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