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					May 2000                                                                                    Detergent Alcohols
609.5000 A                                                                                              Page 1




                                  CEH Marketing Research Report


                                  DETERGENT ALCOHOLS

                                                  By
                                           Robert F. Modler
                                                 with
                                  Andrew DeBoo and Masahiro Yoneyama




         CEH Marketing Research Reports provide comprehensive analysis, historical data and
         forecasts pertaining to the international competitive market environment for chemical
         products. Detailed supply and demand data are developed for the United States,
         Western Europe and Japan with the cooperation of chemical producers and consumers
         worldwide.
         Updated information may be available from the following CEH Program services:
             q   CEH Online—The full text retrieval and update database. Updated monthly.
             q   CEH CD-ROM—The entire contents of the CEH on one CD-ROM and including CEH
                 Online updates. Issued quarterly.
             q   Manual of Current Indicators (MCI)—Updates of statistical data derived from
                 published sources. Issued semiannually.
             q   The Economic Environment of the Chemical Industry (EECI)—Economic
                 indicators that impact the chemical industry; issued quarterly.
             q   CEH Inquiry Service—SRI Consulting researchers are available to answer your
                 questions.
                         U.S.A.—Telephone:   650/859-3900         Fax:   650/859-2182
                         Zürich—Telephone:   411/283-6333         Fax:   411/283-6320
                         Tokyo—Telephone:    813/5251-1741        Fax:   813/5251-1754




                         © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                                    DETERGENT ALCOHOLS                                                         Detergent Alcohols
609.5000 B                                                                                                                                         Page 2

                                                         TABLE OF CONTENTS

Summary ..................................................................................................................................................    3

Introduction..............................................................................................................................................    7

Manufacturing Processes .........................................................................................................................              8
 Conversion of Natural Fats and Oils....................................................................................................                       8
   Reduction of Methyl Esters .............................................................................................................                    8
   Reduction of Fatty Acids.................................................................................................................                  10
   Saponification of Esters ...................................................................................................................               10
 Synthesis from Petroleum-Derived Raw Materials .............................................................................                                 10
   Oxo (Hydroformylation) Reaction ..................................................................................................                         10
   Linear Primary Alcohols from Ethylene..........................................................................................                            12
      Alfol® Alcohol Process...............................................................................................................                   13
      Controlled Linear Chain-Growth Process....................................................................................                              13
   Linear Secondary Alcohols by Paraffin Oxidation..........................................................................                                  14
   Other Routes ....................................................................................................................................          14

Environmental Issues...............................................................................................................................           15

Supply and Demand by Region ...............................................................................................................                   15
  North America .....................................................................................................................................         15
    Producing Companies ......................................................................................................................                15
    Salient Statistics...............................................................................................................................         17
    Consumption....................................................................................................................................           19
       Alcohol Ethoxylates.....................................................................................................................               23
       Alcohol Sulfates and Ether Sulfates ............................................................................................                       28
         Laundry detergents ..................................................................................................................                30
         Dishwashing liquids.................................................................................................................                 30
         Other household cleaners.........................................................................................................                    30
         Personal care products .............................................................................................................                 30
         Industrial, institutional and commercial uses ..........................................................................                             31
       Polymethacrylate Esters ..............................................................................................................                 31
       Fatty Nitrogen Derivatives ..........................................................................................................                  32
       Alkyl Glyceryl Ether Sulfonates..................................................................................................                      33
       Alkyl Polyglucosides ...................................................................................................................               33
       Hindered Phenols.........................................................................................................................              33
       Thiodipropionate Esters...............................................................................................................                 34
       Other Derivatives.........................................................................................................................             35
         Ethoxylated and propoxylated alcohols...................................................................................                             35
         Alcohol phosphates and ether phosphates ...............................................................................                              35
         Esters of fatty acids..................................................................................................................              35
         Alcohol phosphites ..................................................................................................................                36
         Benzophenones ........................................................................................................................               36
       Free Alcohols...............................................................................................................................           36
         C12-C18 fraction .....................................................................................................................               36
         C20+ fraction ...........................................................................................................................            37
    Price .................................................................................................................................................   37



                                    © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                                    DETERGENT ALCOHOLS                                                           Detergent Alcohols
609.5000 C                                                                                                                                           Page 3

                                             TABLE OF CONTENTS (continued)

     Trade ................................................................................................................................................     39
        Imports.........................................................................................................................................        39
        Exports.........................................................................................................................................        40
   Mexico .................................................................................................................................................     42
   Western Europe....................................................................................................................................           42
     Producing Companies ......................................................................................................................                 42
     Salient Statistics...............................................................................................................................          46
     Consumption....................................................................................................................................            47
        Alcohol Ethoxylates.....................................................................................................................                48
        Alcohol Sulfates ..........................................................................................................................             49
        Polymethacrylate Esters ..............................................................................................................                  49
        Fatty Nitrogen Derivatives ..........................................................................................................                   50
        Thiodipropionate Esters...............................................................................................................                  50
        Other Derivatives, Alcohols Used as Such and C20+ Alcohols..................................................                                            50
     Price .................................................................................................................................................    51
     Trade ................................................................................................................................................     52
   Eastern Europe.....................................................................................................................................          52
     Producing Companies ......................................................................................................................                 52
     Production........................................................................................................................................         53
     Consumption....................................................................................................................................            54
     Trade ................................................................................................................................................     55
   Japan ....................................................................................................................................................   55
     Producing Companies ......................................................................................................................                 55
     Salient Statistics...............................................................................................................................          57
     Consumption....................................................................................................................................            59
     Price .................................................................................................................................................    61
     Trade ................................................................................................................................................     64
   Other Regions ......................................................................................................................................         65
     China................................................................................................................................................      65
     India .................................................................................................................................................    66
     Indonesia ..........................................................................................................................................       66
     Malaysia...........................................................................................................................................        67
     Philippines .......................................................................................................................................        69

Bibliography ............................................................................................................................................       71




                                   © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                  DETERGENT ALCOHOLS                               Detergent Alcohols
609.5000 D                                                                                             Page 4

                                               SUMMARY

Detergent alcohols are those containing twelve or more carbon atoms in chains that are at least 35%
linear.

The following table summarizes the number of producers, capacities, production, consumption and net
imports of detergent alcohols for the three major producing areas of the world in 1998. Where possible,
data for each region are subdivided into those for synthetic alcohols (i.e., derived from petrochemical
sources) and those for natural alcohols (i.e., derived from fats and oils).

                          Supply/Demand for Detergent Alcohols by Major Region—1998a
                                              (millions of pounds)
                              Number of                                    Net
                              Producers     Capacityb     Production     Importsc      Consumptiond

         North Americae
           Synthetic               3            910             --f          --f             --f
           Natural                 2            260             --f          --f             --f

             Total                 5           1,170           993          45            1,036

         Western Europe
          Synthetic                5            595            454           --f             --f
          Natural                  5            871            670           --f             --f


             Total                 9g          1,466         1,124         –66            1,058

         Japan
           Synthetic               3            194            117         –11             106
           Natural                 1             44             31         117             148

             Total                 4            238            148         106             254

         Total
           Synthetic              11           1,699            --f          --f             --f
           Natural                 8           1,175            --f          --f             --f


             Total                18g          2,874         2,265          85            2,348




                          © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                      DETERGENT ALCOHOLS                                        Detergent Alcohols
609.5000 E                                                                                                          Page 5

                      Supply/Demand for Detergent Alcohols by Major Region—1998a (continued)
                                             (thousands of metric tons)
                               Number of                                             Net
                               Producers            Capacityb        Production    Importsc       Consumptiond

         North Americae
           Synthetic                3                  413                --f         --f               --f
           Natural                  2                  118                --f         --f               --f

              Total                 5                  531              450.5        20.5              470

         Western Europe
          Synthetic                 5                  270              206           --f               --f
          Natural                   5                  395              304           --f               --f

              Total                 9g                 665              510         –30                480

         Japan
           Synthetic                3                   88               53          –5                  48
           Natural                  1                   20               14          53                  67

              Total                 6                  108               67          48                115

         Total
           Synthetic               11                  771                --f         --f               --f
           Natural                  9                  533                --f         --f               --f

              Total                19g                1,304            1,027.5       38.5             1,065

         a.   Excludes countries outside the three major producing regions.

         b.   Capacities are those in place as of January 1, 2000.

         c.   A negative net import indicates net exports.

         d.   Equals PRODUCTION plus NET IMPORTS and for North America also includes a producer
              inventory change of plus 3 million pounds ( one thousand metric tons).

         e.   Includes the United States and Canada, but excludes Mexico.

         f.   Only total estimates are available.

         g.   One Western European producer operates both a natural and a synthetic alcohol plant; thus, the total
              number of producers is one less than the sum of the types.

         SOURCE:         CEH estimates.



All of the North American detergent alcohol production is located in the United States. There is no
detergent alcohol capacity in Mexico or Latin America. However, an additional 974 million pounds (442
thousand metric tons) of production capacity is accounted for by natural alcohol producers in Southeast
Asia (outside China), including four in the Philippines, three in Malaysia, three in India and two in
Indonesia.

Worldwide, the Shell Group has the largest capacity for detergent alcohol production. The CONDEA
Group (owned by RWE-DEA für Mineralöl und Chemie [Germany]) is the second-largest. The Cognis
Group (formerly the Henkel Group) is the third-largest and The Procter & Gamble Company (P&G) and
its various joint ventures or other arrangements probably represent the fourth-largest group; Kao

                          © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                     DETERGENT ALCOHOLS                                          Detergent Alcohols
609.5000 F                                                                                                           Page 6

Corporation and its joint ventures probably represent the fifth-largest supplier. Together, these five
multinational corporations account for over 71% of the worldwide (excluding China and the former
USSR) detergent alcohol capacity. Shell produces only synthetic alcohols. Cognis, P&G and Kao produce
only natural alcohols and the CONDEA Group produces both types.

Over 94% of the detergent alcohols consumed in North America in 1998 were C 12-C18 alcohols that were
converted to various derivatives. Another 4% were C 12-C18 alcohols that were consumed as such and the
balance (less than 2%) consisted of C20+ products. The following table outlines North American
consumption of detergent alcohols by derivative type and gives growth projections for each type:

                               North American Consumption of Detergent Alcohols—1998
                                                                                             Average Annual
                                                                                              Growth Rate,
                                                       Millions of     Thousands of            1998-2003
                                                        Pounds         Metric Tons              (percent)

               Alcohol Ethoxylatesa                       805               365                  3.3
               Alcohol Sulfates                            60                27                  2.1
               Polymethacrylate Esters                     25                11.5                1
               Fatty Nitrogen Derivatives                  20                 9                  1
               Alcohol Glyceryl Ether Sulfonates           16                 7                  0
               Alkylpolyglucosides                         16                 7                  6
               Hindered Phenols                             8.5               4                  3.5
               Thiodipropionate Esters                      6                 3                  2.2
               Other Derivatives                           15.5               7                  2
               Free Alcohols, C12-C18                      41                19                  1.5
               C20+ Alcohols                               20                 9                  3
               Consumer Inventory/Other                     3                 1.5                0

                    Total                                1,036              470                  3.0%

               a.     Includes alcohol ethoxylates used to produce alcohol ether sulfates.

               SOURCE:          CEH estimates.



The major derivatives, alcohol ethoxylates (AE), the alcohol ether sulfates (AES) derived from them and
alcohol sulfates (AS), are surfactants that are mainly consumed in household detergents.

Western European consumption of detergent alcohols amounted to 1,058 million pounds (480 thousand
metric tons) in 1998. A breakdown of this consumption by major product type and projected average
annual growth rates for the 1998-2003 period are shown in the following table:




                            © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                      DETERGENT ALCOHOLS                                       Detergent Alcohols
609.5000 G                                                                                                         Page 7

                                Western European Consumption of Detergent Alcohols—1998
                                                                                           Average Annual
                                                                                            Growth Rate,
                                                    Millions of       Thousands of           1998-2003
                                                     Pounds           Metric Tons             (percent)

                Alcohol Ethoxylatesa                     608                276                 3
                Alcohol Sulfates                         181                 82                2.5-3
                Polymethacrylate Esters                   64                 29                 2
                Fatty Nitrogen Derivatives                35                 16                10
                Thiodipropionate Esters                   11                  5                 0
                Other Derivatives, Alcohols
                 Used as Such and C20+
                 Alcohols                                159                 72                 3

                      Total                            1,058                480                 3%

                a.     Includes alcohol ethoxylates used to make alcohol ether sulfates.

                SOURCE:           CEH estimates.



Japanese consumption of detergent alcohols amounted to 254 million pounds (115 thousand metric tons)
in 1998 The following table shows the Japanese consumption of detergent alcohols by derivative type in
1998 and projections for future consumption:

                                    Japanese Consumption of Detergent Alcohols—1998
                                                                                           Average Annual
                                                                                            Growth Rate,
                                                   Millions of       Thousands of            1998-2003
                                                    Pounds           Metric Tons              (percent)

                Alcohol Ethoxylatesa                  144                   65                  2.6
                Alcohol Sulfates                       46                   21                 –3.0
                Other Derivatives                      40                   18                  2.1
                Alcohols Used as Such                  24                   11                  1.8

                     Total                            254                 115                   1.5%

                a.     Includes alcohol ethoxylates used to make alcohol ether sulfates.

                SOURCE:           CEH estimates.




                                                   INTRODUCTION

In this report, detergent alcohols are defined as alcohols containing twelve or more carbon atoms per
molecule and having a carbon backbone with a high degree of linearity. This definition permits discussion
of a range of alcohol products that are employed mainly in detergents but also in a number of diverse
applications. It excludes alcohols that contain fewer than twelve carbons and are used in detergent
applications, since such alcohols are used to a greater extent in other products and are treated separately in
the CEH Plasticizer Alcohols (C4-C13) marketing research report. It also excludes highly branched
alcohols containing more than twelve carbons, such as the tridecyl alcohol produced by Exxon Chemical
Company from propylene tetramer; 2,6,8-trimethyl-4-nonanol produced by Union Carbide Corporation;
and Guerbet alcohols produced by several companies. Exxon’s highly branched tridecyl alcohol does

                              © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                DETERGENT ALCOHOLS                                Detergent Alcohols
609.5000 H                                                                                            Page 8

have some detergent applications but is used mainly in plasticizers. The Guerbet alcohols compete in
some applications with the detergent-range alcohols discussed in this report, but they are not used in
detergent applications. The Guerbet and the nonlinear tridecyl alcohols are described only in the
MANUFACTURING PROCESSES section to complete the discussion of alternate production methods.

Alcohols derived from animal fats and vegetable oils have a carbon backbone that is 100% linear, but
those derived from ethylene and n-paraffins may range from 35% to 99% linear. However, the level and
type of branching still permit their use in most detergent applications. The processes used in the United
States yield products that are 75-100% linear. Secondary alcohols produced by oxidation of paraffins are
included in this report, since their backbone is close to 100% linear and they are used in many of the same
applications.

The definition chosen also includes a small volume of products with twenty or more carbon atoms per
molecule. These products are unavoidably coproduced by those manufacturers using Ziegler chemistry
(see the MANUFACTURING PROCESSES section) and may contain hydrocarbons as well as linear
and nonlinear alcohols, depending on the process type. These “higher” alcohols are treated separately in
the U.S. and Western European sections of this report but are included in the production statistics for
detergent alcohols. There is no production of the C20+ range in Japan.



                               MANUFACTURING PROCESSES

Detergent-range alcohols are commercially produced in a number of ways, but the resulting products are
usually classified according to the source of the raw materials used to produce them. There are two gen-
eral categories: those derived from fats and oils and those derived from crude oil, natural gas or natural
gas liquids. The former category is often referred to as natural alcohols, while the latter are commonly
known as synthetic alcohols. The term synthetic is somewhat misleading, since both synthetic and natural
alcohols are derived from processes involving chemical synthesis. The term natural is also misleading, as
crude oil and natural gas are both found in nature, although the alcohols derived from them are called syn-
thetic. Some industry sources have suggested using the terms petrochemical (i.e., derived from petroleum
or natural gas) and oleochemical (derived from fats and oils) to better describe these products.

Historically, the choice of feedstock upon which to base a new detergent alcohol plant has largely been
determined by the economics of the processes, including the cost of raw materials. In the last ten years,
the desire of Southeast Asian countries to utilize their native raw materials (i.e., coconut, palm kernel and
palm oils) to create downstream value-added products and local employment has also been a factor. In
addition, an increase in the planting of palm and coconut trees in various countries of Southeast Asia has
improved the outlook for both the long-term price and the stability of supply of the natural oils compared
with previous decades. As a result, nearly all new detergent alcohol plants in recent years and those
planned for the future are based on natural oils, rather than petrochemical sources.


CONVERSION OF NATURAL FATS AND OILS

REDUCTION OF METHYL ESTERS

Coconut and palm kernel oils and tallow fat (a by-product of the rendering industry) are the major feed
materials for this route to alcohols. The compositions of the fatty acids present in the triglycerides that
compose the major raw materials are as follows:

                        © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                         DETERGENT ALCOHOLS                                              Detergent Alcohols
609.5000 I                                                                                                                   Page 9

                       Fatty Acid Composition of Coconut Oil, Palm Kernel Oil and Tallow
                                              (percent by weight)
                     Chain                        Coconut                  Palm
                     Length                         Oil                  Kernel Oil                   Tallow

                   Saturated
                     C6                              0-0.8                  0-1.5                       --
                     C8                              5-9                    3-5                         --
                     C10                             6-10                   3-7                         --
                     C12                            44-52                  40-52                       0-0.2
                     C14                            13-19                  14-17                       2-8
                     C16                             8-11                   7-9                       24-37
                     C18                             1-3                    1-3                       14-29
                     C20+                            0-0.4                  0-1                       0-1.2

                        Range                    88.5-95                   78-86.5                    42-57

                   Unsaturated
                     C14                              --                     --                       0.4-0.6
                     C16                             0-1                    0-1                       1.9-2.7
                     C18                             5-10.5              13.5-21                      41-55

                        Range                        5-11.5              13.5-22                      43-58

                   SOURCE:           D. Swern, Bailey’s Industrial Oil and Fat Products, 3rd ed.,
                                     Interscience Publishers, New York, 1964, pp. 176 and 192.



The triglycerides are first subjected to ester interchange with excess methanol using an alkaline catalyst:

                 RCOOCH2                                                                              HOCH 2
                                                        NaOCH 3
                 RCOOCH          +       3 CH OH                          3 RCOOCH            +       HOCH
                                             3                                          3
                 RCOOCH2                                                                              HOCH 2

                 triglyceride            methanol                         methyl ester                glycerin



The resulting methyl esters are subjected to distillation and then may be converted to alcohols,
alkanolamides or fatty acids or they may be used in the production of other derivatives. The by-product
glycerin is normally refined and sold.

Hydrogenation of the methyl esters to alcohols is performed continuously at pressures above 3,000 psi
using a copper chromite catalyst:

                                                       copper chromite
                 RCOOCH3             +    2H2                                   RCH2OH            +    CH3OH

                 methyl ester            hydrogen                                   alcohol           methanol



Most of the methanol is recovered in the process and is recycled for use in the ester exchange step. The
alcohol product (95% overall yield from the triglyceride) is fractionated to eliminate small amounts of
high-boiling impurities and to give the desired cuts of alcohols.




                        © 2000 by the Chemical Economics Handbook—SRI International
May 2000                               DETERGENT ALCOHOLS                                Detergent Alcohols
609.5000 J                                                                                          Page 10

When copper chromite catalyst is used, all double bonds are hydrogenated, a process that is satisfactory
for most applications. This process is employed to produce detergent-range alcohols by most
manufacturers, including some of the world’s largest detergent producers such as P&G, Cognis Group
and Kao Corporation.


REDUCTION OF FATTY ACIDS

Fats and oils may be hydrolyzed to the corresponding fatty acids and subsequently reduced catalytically
to the alcohols. Variations in catalysts and operating conditions permit retention of double bonds, if
desired. Until 1991, the former Sherex Chemical Company, Inc. (now part of CK Witco Corporation)
used its own variation of this method to produce oleyl and tallow alcohols from the corresponding fatty
acids. CONDEA Chemie GmbH of Germany and United Coconut Chemicals Inc. in the Philippines
produce saturated fatty alcohols by direct reduction of acids.


SAPONIFICATION OF ESTERS

Production of fatty alcohols by saponification of sperm whale oil was once a source of detergent alcohols.
However, this process has been largely eliminated by restrictions on hunting the sperm whale. The
alcohols are no longer isolated from this source on a commercial basis in the United States or Western
Europe and Japan has also terminated nearly all of its production of alcohols from sperm oil.

Wool grease is another potential source of detergent alcohols, but it is usually refined only to produce
lanolin, even though saponification can give an alcohol fraction. Amerchol Corporation (a part of Union
Carbide Corporation) in the United States does produce a very small volume of alcohol from lanolin (less
than one million pounds), but its production is largely consumed captively.


SYNTHESIS FROM PETROLEUM-DERIVED RAW MATERIALS

A number of synthetic routes have been developed for producing detergent-range alcohols from
petroleum-derived raw materials. Ethylene or n-paraffins are the basic chemical starting materials and the
oxo process and Ziegler chemistry are the most important routes. Propylene and other raw materials can
be used to produce nonlinear alcohols in the detergent range, but these alcohols are normally employed in
plasticizer or other specialty applications and are not important sources for detergent applications because
they are too slow to biodegrade and often pose other performance problems.


O XO (HYDROFORMYLATION) REACTION

The oxo reaction as applied to the synthesis of detergent-range alcohols is currently employed
commercially in a variety of modifications. Although each of these processes represents unique
technology, they all involve the reaction of olefins with synthesis gas (CO/H2) in the presence of an oxo
catalyst to yield higher alcohols.

The major differences among the processes involve the type of olefin, catalysts and cocatalysts,
stoichiometry, process conditions (including catalyst recovery), handling of intermediates, product
composition and by-product formation.



                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                         DETERGENT ALCOHOLS                                                Detergent Alcohols
609.5000 K                                                                                                                    Page 11

Most of the oxo plants in the world, except those belonging to the Shell Group, use processes in which the
intermediate aldehydes are isolated, purified and then hydrogenated in a second reactor. The sequence of
steps includes the following: hydroformylation, catalyst removal and recycle, aldehyde distillation,
aldehyde hydrogenation and finally purification of the product alcohols. In some cases, particularly with
the higher olefins that yield high-boiling aldehydes along with smaller quantities of the corresponding
alcohols, effective fractionation of the aldehydes is difficult, so the crude hydroformylation reactor
product is hydrogenated directly.

The basic chemistry is represented in the following reactions:

                                                                                   H                          R5
                                                                catalyst
              1. R1 CH       CHR2       +     CO/H2                              R 3C    O          +   R4    C    C    O

                                                                                                              H    H

                   alpha- or internal        synthesis                            linear                     branched
                        olefin                  gas                             aldehyde                     aldehyde



              H                     R5                                                                       R5
                                                           H2
        2. R 3 C    O    +    R4    C        C    O                        R3    CH2 OH         +       R4   C     CH2OH
                                                         catalyst
                                    H        H                                                               H

                     aldehyde mixture                                      linear alcohol               branched alcohol



The olefins employed in this reaction may be internal olefins (derived from n-paraffins) or alpha-olefins
(derived from ethylene). This process normally leads to a high degree of branching and the resulting
products are not always suitable for applications requiring linearity, such as certain liquid detergent and
cosmetic applications. Because alpha-olefins produce less branching, they are preferred over internal
olefins as feedstock.

CONDEA Augusta in Italy produces alcohols via this process, using its own internal olefins derived from
dehydrogenation of n-paraffins.

BASF Corporation, Exxon Chemical Americas and Noroxo (formerly CdF Chimie Specialites) also use
oxo technology to produce plasticizer alcohols, including a tridecyl (C 13) alcohol, which is a branched
alcohol derived from a propylene tetramer. This product is highly branched and in most end uses is not
competitive with linear alcohols.

A major modification of the oxo process is employed by Shell Chemical Company at its plants in the
United States and Europe and by Mitsubishi Chemical Corporation in Japan under license from Shell.
This process is conducted in one step: both hydroformylation and hydrogenation of the intermediate
aldehyde occur in the same reactor. A special catalyst, believed to be a cobalt type modified with a
phosphine ligand, is employed. This process is represented by the following reaction:

                                                                                                        R5
                                                          catalyst
               R 1CH     CHR2       +       CO/H2                           R 3 CH 2OH      +        R 4 CHCH 2 OH

                                        synthesis                                               2-alkyl branched-
               internal olefin            gas                                n-alcohol           chain alcohols


                         © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                   DETERGENT ALCOHOLS                                   Detergent Alcohols
609.5000 L                                                                                                 Page 12

The catalyst offers several advantages over other systems:

    q   The catalyst is more stable thermally, a factor allowing the process to operate at lower pressures.

    q   With linear olefins as feedstocks, this process produces alcohols with both normal (i.e., linear)
        and iso (i.e., branched) structures; however, the n : iso ratios are the highest reported for any oxo
        process. The higher detergent-range olefins yield alcohols with an n : iso ratio of approximately
        80:20.

    q   Linear olefins, either terminal (alpha) or random internal, yield alcohols with essentially the same
        n : iso ratio. Unmodified oxo processes must use alpha-olefin feeds to yield alcohols with the
        desired high ratio of normal to iso structures.

This modified oxo process was first commercialized by Shell Chemical Company in the United States. In
its U.S. plant at Geismar, Louisiana, Shell uses C11-C 14 linear internal olefins to produce C12-C 15
alcohols. The olefin feedstock is produced captively by Shell’s new ethylene oligomerization process,
which makes internal olefins, and from n-paraffins, which are isolated from kerosene fractions. (See the
CEH Linear alpha-Olefins, Oxo Chemicals and Normal Paraffins (C9 -C17) marketing research reports for
additional information.)


LINEAR PRIMARY ALCOHOLS FROM ETHYLENE

Ethylene can be added to triethylaluminum to build a mixture of high-molecular-weight trialkyl
aluminums known as the ethylene growth product. When this growth product is oxidized with air, it is
converted to the corresponding aluminum alkoxide. Hydrolysis of this alkoxide leads to a mixture of
linear primary alcohols having the same number of carbon atoms as the alkyl groups in the trialkyl
aluminum growth product.

                                                                              (CH2CH2 )x CH2 CH3

                Al(C 2H 5 )3    +   (x + y + z)C2 H4                Al       (CH2 CH2) y CH2 CH3

                                                                              (CH2CH2 ) z CH2 CH3

             triethylaluminum          ethylene                              growth product



                           (CH2CH2 )x CH2 CH3                            O(CH2 CH2 ) xCH2 CH3
                                                       (O)
                 Al       (CH2CH2) y CH2CH3                    Al        O(CH2 CH2 )y CH2CH3

                           (CH2CH2 )z CH2 CH3                            O(CH2 CH2 ) zCH2 CH3

                         growth product                              aluminum alkoxide




                         © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                   DETERGENT ALCOHOLS                            Detergent Alcohols
609.5000 M                                                                                          Page 13

             OCH 2 CH2 )x CH2 CH 3                              CH3CH2(CH 2CH2) xOH

       Al    O(CH2CH2 )y CH2 CH3       +   3H 2O                CH3CH2(CH 2CH2) yOH     +   Al(OH) 3

             OCH 2 CH2 )z CH2 CH3                               CH3CH2(CH 2CH2) zOH

               aluminum                                              linear primary         aluminum
                alkoxide                                                alcohols            hydroxide



Two commercial processes have been developed on the basis of this Ziegler technology. One (which was
developed by the former Conoco Chemical Co.) is used by CONDEA Vista Company and the other
(which was developed by Ethyl Corporation) is used by BP Amoco Corp. The major features that
distinguish these two processes from each other are the distribution of chain lengths obtained in the
spectrum of alcohols produced, the design technique used to manipulate or control this distribution and
the form in which the catalyst is recovered.


Alfol® Alcohol Process

The ethylene growth reaction is conducted at moderate temperatures to minimize a competing
displacement reaction that produces by-product olefins. The growth reaction is allowed to proceed until
the alkyl chains in the intermediate trialkyl aluminum have grown to an average length of ten carbon
atoms. The distribution of chain lengths in the growth product and the alcohols derived from them
conforms with the statistical distribution predicted by a Poisson curve. The aluminum hydroxide
produced by the aqueous hydrolysis of the alkoxide is recovered for sale as high-purity alumina, Al 2O3 .
The resulting alcohols closely resemble natural alcohols in that they contain an even number of carbon
atoms and are nearly 100% linear. However, the Alfol® alcohol process characteristically yields a wide
spectrum of alcohols (C2 -C28). Even though the process can be manipulated to shift the number of carbon
atoms either up or down in the alcohol produced in largest volume, the distribution pattern is maintained.
This constant pattern limits the ability of the producer to make only the specific alcohol range that is in
highest demand or has the best economic value. A typical distribution of products from this process is as
follows:

                                 C2         1%                C16    8.5%
                                 C4         3%                C18    5%
                                 C6         9%                C20    2.5%
                                 C8        18%                C22    1%
                                 C10       19%                C24    0.5%
                                 C12       18%                C26    0.3%
                                 C14       14%                C28+   0.2%

This process is used by CONDEA Vista Company in the United States and CONDEA Chemie GmbH in
Germany.


Controlled Linear Chain-Growth Process

Ethyl Corporation commercialized a process that maximizes the production of lauryl (C12) and myristyl
(C14) alcohols, the most desirable chain lengths for surfactant applications. This modified multistage
process consists of a growth reaction stage followed by three different transalkylation reactions.



                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                DETERGENT ALCOHOLS                              Detergent Alcohols
609.5000 N                                                                                         Page 14

The first transalkylation reaction converts a part of the original growth product into short-chain
(predominantly C6 -C 10 ) trialkyl aluminum, while the second transalkylation reaction converts the
remainder into long-chain (predominantly C12-C16) trialkyl aluminum. The (C 12-C16) 3 trialkyl aluminum
streams are collected and further processed to yield alcohols (C12 and higher). The short-chain trialkyl
aluminum is recycled to the growth reactor. However, during the first and second transalkylation
reactions, side reactions do occur that introduce branched-chain components into the system. Purified
(C12-C16) 3 trialkyl aluminum is produced by a third transalkylation, which eliminates the unwanted
products. A typical distribution of alcohols achieved by this process is as follows:
                                 C4      1%                  C20     3%
                                 C6      2%                  C22     2%
                                 C8      3%                  C24     1.5%
                                 C10     7.5%                C26     1%
                                 C12    32%                  C28     0.5%
                                 C14    24%                  C30     0.3%
                                 C16    15%                  C32+    0.2%
                                 C18     7%

Thus, about 85% of the products are C12 and higher and they are about 95% linear, compared with over
99% linear for CONDEA Vista’s process. The catalyst is currently recovered as Al 2 (SO4 ) 3 or alum,
which is sold for use in papermaking, water treating and other uses. Amoco Corporation acquired this
process from Albemarle Corporation (which in turn was spun off from Ethyl Corporation). Later, Amoco
merged with BP Oil to become BP Amoco Corporation, and it is the only company using this process.


LINEAR SECONDARY ALCOHOLS BY PARAFFIN OXIDATION

The liquid-phase oxidation of paraffins normally causes considerable scission of the chain and gives a
wide variety of oxygenated products (including peroxides, alcohols, acids and esters). Methods to
improve the yield of alcohols have been studied and patents describing the use of various catalysts and
varied reaction conditions have been granted to a number of companies. The feed hydrocarbons are very
pure normal paraffins. Thus, the derived alcohols are virtually free of branched-chain components and
have the hydroxyl groups located in a random manner on all but the terminal carbon atoms.

                                                (O)
                       CH3(CH 2) xCH3                   CH3 (CH2) yCH(CH2 )z CH 3

                                                                    OH

                            paraffin                        secondary alcohol



Nippon Shokubai Co., Ltd. in Japan produces detergent-range alcohols by this route, using its own
technology. Union Carbide Corporation had operated a plant in the United States using similar technology
to produce C11-C15 secondary alcohols, but it was closed in 1977.


O THER ROUTES

Cognis and CONDEA Chemie (both in Germany) and Exxon Corporation in the United States employ the
Guerbet process to produce higher alcohols by self-condensation of lower alcohols. This process is
believed to involve a series of complex reactions including the conversion of the starting alcohol to an
aldehyde, an aldol condensation, dehydration and finally a reduction, all under the influence of alkali at

                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                  DETERGENT ALCOHOLS                                    Detergent Alcohols
609.5000 O                                                                                                 Page 15

high temperature. The products are branched alcohols, including C16-C26 and higher alcohols. These
alcohols are not discussed further in this report.

Secondary alcohols in the detergent range can be produced by sulfation of olefins. Shell Chemicals UK
Ltd. in Western Europe once produced a monoalkylsulfate ester of a secondary alcohol via the sulfation
of its alpha-olefins derived from wax cracking; however, the process is no longer employed.

The former USSR and some Eastern European countries reportedly once produced synthetic fatty acids by
the catalytic air oxidation of n-paraffins. Most C10-C20-range acids were converted to soaps, but some
were said to be converted to the methyl esters, which were hydrogenated to yield the corresponding
primary saturated alcohols.

Many other routes have been proposed and explored, but none has led to successful commercial ventures.



                                   ENVIRONMENTAL ISSUES

Since detergent alcohols include a wide range of products that vary in chain length, level of saturation and
degree of branching, it is not possible to present meaningful toxicity data. However, detergent-range
alcohols are generally considered to be products of low acute toxicity. Their low vapor pressure,
especially for the longer chain lengths, suggests that risks due to inhalation are probably very low. Higher
fatty alcohols are generally well tolerated by human skin and they have been used in cosmetic and
pharmaceutical formulations for many years with no apparent problems. Both the free alcohols and their
common surfactant derivatives biodegrade rapidly and fully under both aerobic and anaerobic conditions.



                            SUPPLY AND DEMAND BY REGION

NORTH AMERICA

PRODUCING COMPANIES

The following table lists U.S. producers of detergent alcohols:

                          U.S. Producers of Detergent-Range Alcohols (C12 and higher)
                              Annual Capacity
                                for Detergent-
                               Range Alcohols        Total
       Company and          as of January 1, 2000    Plant         Process and
       Plant Location        (millions of pounds)   Capacity        Feedstock                    Remarks

BP Amoco Corp.
    Pasadena, TX                    210               245      Modified Ziegler;      Process yields alcohols of even
                                                               ethylene               carbon numbers from C4 to C 32.

Cognis Corporation
    Cincinnati, OH                   80                92      Reduction of methyl    Plant on stream December 1992.
                                                               esters from coconut/   Further debottlenecking in 1997.
                                                               palm kernel oil        C8 -C1 0 methyl esters also
                                                                                      converted to alcohols at this
                                                                                      plant.


                        © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                         DETERGENT ALCOHOLS                                    Detergent Alcohols
609.5000 P                                                                                                        Page 16

                         U.S. Producers of Detergent-Range Alcohols (C12 and higher) (continued)
                                     Annual Capacity
                                       for Detergent-
                                      Range Alcohols        Total
       Company and                 as of January 1, 2000    Plant         Process and
       Plant Location               (millions of pounds)   Capacity        Feedstock                    Remarks

CONDEA Vista Company
 Surfactants and Specialties
 Division
   Lake Charles, LA                        150               285      Alfol® alcohol         Expansion in progress. Process
                                                                      (Ziegler); ethylene    yields alcohols of even carbon
                                                                                             numbers from C2 to C 28+.

The Procter & Gamble
Company
  Procter & Gamble Chemicals
    Sacramento, CA                         180                        Reduction of methyl
                                                                      esters from coconut/
                                                                      palm kernel oil

Shell Oil Company
  Shell Chemical Company,
  division
     Geismar, LA                           550               600      Modified oxo proc-     Expansion to 800 million pounds
                                                                      ess; olefins from      likely by 2002. Process is
                                                                      ethylene               flexible and the product
                                                                                             distribution may be adjusted to
                                                                                             market demands. Product
                                                                                             linearity is about 80%, compared
                                                                                             with 95-100% for other Ziegler
                                                                                             and natural alcohols.

       Total                               1,170

SOURCE:        CEH estimates.



There are no Canadian producers of detergent alcohols. Shell is the largest U.S. producer of these
products and in recent years, P&G has been the second-largest producer. Cognis (which was Henkel
Corporation prior to January 1, 2000) began producing in December 1992 and is the smallest producer.
Because some industry capacity was dedicated to products outside the detergent range, utilization of
effective capacity during 1998 was significantly lower than nameplate. Indeed, supply has been tight in
several recent years because of feedstock limitations, plant turnarounds and other developments (e.g.,
strong demand for feedstock linear alpha-olefins).

Part of Shell’s capacity is used to produce Neodol®1 and Neodol® 91, both of which are linear alcohols
outside the detergent range (i.e., below C12 ), although some of these alcohols are used in detergent
applications. In addition, some nonlinear plasticizer alcohols that command premium prices are also
produced in the plant. Thus, Shell’s effective capacity for detergent-range products is at least 50-100
million pounds less than its total capacity of 600 million pounds per year. Shell will likely expand its
alcohol capacity to 800 million pounds in late 2002.

BP Amoco’s capacity may also be overstated, since it is believed that part of its capacity for chain growth
formerly devoted to alcohols is now used in its linear alpha-olefin plant. BP Amoco has an agreement
with Huntsman Corporation, whereby Huntsman supplies ethylene to BP Amoco for making detergent

                               © 2000 by the Chemical Economics Handbook—SRI International
May 2000                              DETERGENT ALCOHOLS                               Detergent Alcohols
609.5000 Q                                                                                        Page 17

alcohols. BP Amoco then returns a part of its production to Huntsman for conversion of the alcohols to
alcohol ethoxylates (AE). Huntsman markets the AE products directly to customers and BP Amoco
markets the remainder of its alcohol production to its customers.

P&G had another plant in Kansas City, but it was shut down in 1994. The plant made C16-C18 alcohols,
which are now partially supplied by imports from the P&G plant in Malaysia.

Except for BP Amoco, the current U.S. producers captively consumed some of their detergent alcohols,
mainly to make derivatives, such as alcohol ethoxylates, sulfates and ether sulfates.

Exxon produces plasticizer-range (C 6 -C 11 ) and C13 branched alcohols at a plant in Baton Rouge,
Louisiana. The company added a C13-C15 linear alcohol to its product line in 1986, but never became a
major participant in the detergent alcohols market. It subsequently withdrew from the detergent-range
market in the early 1990s.

Sherex Chemical Company, Inc. (acquired by Witco Corporation and subsequently sold to Th.
Goldschmidt AG) discontinued production of alcohols at its plant in Mapleton, Illinois in late 1991. The
company continued to resell some specialty detergent alcohols purchased from other sources. The
Mapleton alcohol plant had a capacity of only 15 million pounds per year for detergent-range alcohol,
most of which was used to produce oleyl alcohol by direct hydrogenation of oleic acid.


SALIENT STATISTICS

The following tables present CEH estimates of the U.S. supply/demand balance for detergent alcohols for
1979-1996 and for U.S. and Canadian demand for 1997-1999.

                           U.S. Supply/Demand for Detergent Alcohols—1979-1996
                                           (millions of pounds)
                                                                 Stock         Apparent
                        Production     Imports     Exports      Changesa     Consumptionb

               1979        745             15        181             --          579

               1980        745             13        132            26           600
               1981        731             19        137            10           603
               1982        707             19        131            –5           600
               1983        678             20         98           –18           618
               1984        699             11         76            11           623

               1985        713             15         65             0           663
               1986        740             45         81            14           690
               1987        747             70        103             --          714
               1988        776             61        106             --          731
               1989        744             na         na             --          719

               1990        700             45         70             --          675
               1991        711             46         65             --          692
               1992        816             33        124            20           705
               1993        865             23        123             --          765
               1994        865            100         97            –5           873

               1995        915            125        119             4           917
               1996        828            112         84            16           872


                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                  DETERGENT ALCOHOLS                                       Detergent Alcohols
609.5000 R                                                                                                    Page 18


               a.   Producer stock changes; a positive number indicates an addition to inventory and a
                    negative number indicates a withdrawal from inventory. Changes in 1979, 1987-1991
                    and 1993 are unknown and assumed to be insignificant.

               b.   Equals PRODUCTION plus IMPORTS minus EXPORTS plus STOCK CHANGES,
                    except for 1989, where APPARENT CONSUMPTION was estimated.

               SOURCE:       CEH estimates.



                             North American Supply/Demand for Detergent Alcohols
                                             (millions of pounds)
                                                                        Stock           Apparent
                        Production        Imports        Exports       Changesa       Consumptionb

               1997          918              177            91            3               1,001

               1998          993              142            97            2               1,036

               1999         1,083             120          126             7               1,070

               a.   Producer stock changes; a positive number indicates an addition to inventory and a
                    negative number indicates a withdrawal from inventory.

               b.   Equals PRODUCTION plus IMPORTS minus EXPORTS plus STOCK CHANGES.

               SOURCE:       CEH estimates.



In 1998, the value of the detergent alcohols produced in North America was an estimated $610-615
million. This estimate is based on the assignment of an average price during 1998 of alcohols sold into the
major end-use markets and an assignment of a somewhat lower value to the alcohols incorporated into AE
and sold by those large suppliers that are also detergent alcohol producers (i.e., Shell and CONDEA
Vista) or are closely linked through special agreements (i.e., Huntsman/BP Amoco and P&G/Celanese
Corp.). This lower-value assignment is an important consideration, because over half of the detergent
alcohols are consumed internally by producers with ethoxylation capability at a considerably lower value
(i.e., the transfer price) than those sold on the merchant market. However, the full market value was used
for all alcohol consumed internally by Cognis and Procter & Gamble for other derivatives—a very
significant portion of the detergent alcohol production of these two companies.

Between 1990 and 1998, North American production and consumption of detergent alcohols increased an
average of about 4.3% and 5.2% per year, respectively. Consumption in 1998 and 1999 increased about 3-
4% per year, reflecting increasing use of liquid detergents using high levels of alcohol-based surfactants.
This rapid growth is in striking contrast to the 1979-1990 period, when production declined and
consumption grew only 1.4% per year. U.S. consumption did increase at an average annual rate of 4%
over the 1984-1988 period; however, this growth was not sustained in the 1988-1992 period, when
alcohol consumption declined. In trade, the U.S. had been a large net exporter of alcohols, but by 1994,
the United States became a net importer. This shift in trade resulted from the construction of many
detergent alcohol plants in other world areas, including a large expansion of natural alcohol capacity in
Western Europe and Southeast Asia. See the C ONSUMPTION and T RADE sections of this report for
more detailed statistics and an explanation of the developments that have produced these trends.




                        © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                       DETERGENT ALCOHOLS                                   Detergent Alcohols
609.5000 S                                                                                                     Page 19

CONSUMPTION

The United States accounts for nearly all of the direct consumption of detergent alcohols in North
America. Canadian consumption of detergent alcohols in recent years has been only about 10-20 million
pounds, most of which was imported from the United States. The low Canadian consumption (relative to
that of the United States) reflects the sale in Canada of alcohol derivatives (e.g., alcohol ethoxylates) and
end-use products (e.g., detergents and personal care products) that are also imported from the United
States. This situation is a consequence of the relatively small size and noncompetitive status of many
Canadian plants that might consume alcohols and the integrated downstream ethoxylation capabilities of
the large U.S. alcohol producers that internally convert much of their production to ethoxylates before
sale. Furthermore the smaller Canadian alcohol derivative plants are often owned by U.S. or other
multinational companies with larger plants in the United States. Thus, manufacturers of alcohol
derivatives and end-use products consuming alcohols find it more efficient in most cases to supply the
Canadian market from their larger U.S. plants. The enactment of the North American Free Trade
Agreement (NAFTA) has reinforced this tendency.

Almost 98% of detergent alcohols are in the C12-C 18 range, while the balance consists of products
containing twenty or more carbon atoms. The latter category includes some nonlinear alcohols and
hydrocarbons that are coproducts of alcohols produced via Ziegler processes. Over 95% of the C12-C18
alcohols are converted to derivatives that are consumed in various end uses, while the remainder are
consumed as the free alcohol. Alcohols and coproducts in the C20+ range are also either used as such or
converted to derivatives. However, these products are sold at relatively low prices into a multitude of
applications that are not further broken down in the consumption tables. The following tables show the
estimated U.S. consumption of detergent alcohols by derivative type for selected years up to 1996 and the
North America (U.S. and Canadian) consumption for 1997-1998. (Refer to the SALIENT STATISTICS
section for additional historical data on total consumption.)

                         U.S. Consumption of Detergent Alcohols by Derivative Type—1980-1996
                                                 (millions of pounds)
                                                                                                        Free
                                                      Fatty       Alkyl                              Alcohols,
                                      Polymeth-      Nitrogen    Glyceryl     Thiodi-     Other      Including
          Alcohol         Alcohol      acrylate      Deriva-      Ether      propionate   Deriva-       C20+
        Ethoxylatesa      Sulfates      Esters         tives    Sulfonates     Esters      tives      Alcohols   Total

1980         268           163            60            19         26            5          11          48       600

1985         373           148            38            16         18            6          14          50       663

1988         398           201            33            15         10            6          16          52       731
1989         406           182            31            15         10            7          16          52       719

1990         426           119            30            14         10            7          16          53       675
1991         405           157            29            14         10            7          16          54       692
1992         401           171            28            20         10            6          16          53       705
1993         532            76            28            24         11            6          33          55       765
1994         626            63            35            25         13            6          40          65       873

1995         686             64           23            25         15            6          35          63       917
1996         671             37           24            20         17            6          35          62       872

a.   Includes AE used to produce AES or other derivatives.

SOURCE:       CEH estimates.


                           © 2000 by the Chemical Economics Handbook—SRI International
 May 2000                                          DETERGENT ALCOHOLS                                         Detergent Alcohols
 609.5000 T                                                                                                              Page 20

                            North American Consumption of Detergent Alcohols by Derivative Type
                                                  (millions of pounds)
                                                                                                                   Free
                                                         Fatty          Alkyl                                   Alcohols,
                                          Polymeth-     Nitrogen       Glyceryl                     Other       Including
            Alcohol         Alcohol        acrylate     Deriva-         Ether          Alkypoly-    Deriva-        C20+
          Ethoxylatesa      Sulfates        Esters        tives       Sulfonates       glucosides    tives       Alcohols   Total

1997           778             59             22           19             16              16          30           61       1,001

1998           805             60             25           20             16              16          30           61       1,033

a.     Includes AE used to produce AES or other derivatives.

SOURCE:         CEH estimates.



 The following table shows a further breakdown of consumption in 1998 and projections for future
 growth:

                             North American Consumption and Growth Rate of Detergent Alcohols
                                                by Derivative Type—1998
                                                                                               Average Annual
                                                                                                Growth Rate,
                                                                      Quantity                   1998-2003
                                                                (millions of pounds)              (percent)

                      Alcohol Ethoxylatesa                             805                           3.3
                      Alcohol Sulfates                                  60                           2.3
                      Polymethacrylate Esters                           25                           1
                      Fatty Nitrogen Compounds                          20                           1
                      Alkyl Glyceryl Ether Sulfonates                   16                           2.5
                      Alkyl Polyglucosides                              16                           6
                      Hindered Phenols                                   8.5                         3.5
                      Thiodipropionate Esters                            6                           2.2
                      Other Derivatives                                 15.5                         2
                      Free Alcohols
                        (C12-18)                                        41                           1.5
                        (C20+)                                          20                           2

                           Total                                      1,033b                         3.0%

                      a.   Includes AE used to produce AES or other derivatives.

                      b.   The consumption value shown in the table is 3 million pounds less than that
                           previously shown in the supply/demand table. The difference is attributed to either a
                           consumer inventory buildup or other causes.

                      SOURCE:          CEH estimates.



 About 64% of the total consumption was in household detergents, 14% in personal care products and 22%
 in industrial applications. Four surfactants AE, AS, alkylpolyglucosides (APG) and alkylglyceryl ether
 sulfonates (AGES) accounted for about 87% of the consumption by product type. Well over half of AE
 production was subsequently converted to AES. These five surfactants are used in household heavy-duty
 (laundry) powders and liquids, light-duty (dishwashing) liquids, other household cleaners, personal care
 products (especially shampoos and soaps) and a variety of industrial, commercial and institutional uses.


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May 2000                                       DETERGENT ALCOHOLS                                          Detergent Alcohols
609.5000 U                                                                                                            Page 21

Other important derivatives include the polymethacrylate esters used as lubricating oil additives; fatty
nitrogen intermediates used to make sanitizing agents, hair conditioners and surfactants; and hindered
phenols and thiodipropionate esters used as plastics additives. A variety of other detergent alcohol
derivatives are consumed in smaller amounts and some detergent alcohols are used as such, with no
conversion to derivatives.

The following tables show estimates of the U.S. consumption of detergent alcohols by end use in 1988,
1992, 1995 and 1996 and North American consumption in 1997 and 1998.

                               U.S. Consumption of Detergent Alcohols by End Use—1988-1996
                                                    (millions of pounds)
                                  Household Products
                                                                                                      Industrial,
                                                      Other                                        Institutional and
          Heavy-Duty          Light-Duty            Household                     Personal         Commercial Uses
           (laundry)         (dishwashing)           Cleaners                       Care             and Exported
           Products             Liquids           and Sanitizers       Total      Productsa           Derivatives      Total

1988          285                   123                 25              433           107                 191           731

1992          276                    88                 26              390           120                 195           705

1995          436                   124                 29              589           135                 193           917
1996          397                   139                 28              564           132                 176           872

a.   Includes consumption in shampoos, bubble baths, toothpaste, toilet soaps, cosmetics and similar products.

SOURCE:       CEH estimates.



                              North American Consumption of Detergent Alcohols by End Use
                                                 (millions of pounds)
                                  Household Products
                                                                                                      Industrial,
                                                      Other                                        Institutional and
          Heavy-Duty          Light-Duty            Household                     Personal         Commercial Uses
           (laundry)         (dishwashing)           Cleaners                       Care             and Exported
           Products             Liquids           and Sanitizers       Total      Productsa           Derivatives      Total

1997          469                   143                 29              641           144                 220          1,005

1998          475                   160                 27              662           146                 225          1,033

a.   Includes consumption in shampoos, bubble baths, toothpaste, toilet soaps, cosmetics and similar products.

SOURCE:       CEH estimates.




                            © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                  DETERGENT ALCOHOLS                              Detergent Alcohols
609.5000 V                                                                                           Page 22

                               U.S. Consumption of Detergents Alcohols
                                         by End Use—1998

                                                         Other
                                                       Household
                                        Personal         2.6%
                                         Care
                                         14.1%




                           Household                                    Household
                          Dishwashing                                    Laundry
                             15.5%                                        46.0%




                                         Industrial
                                        Applications
                                           21.8%




The very rapid growth in the use of detergent alcohols during the 1990s resulted from a number of
developments, including the following:

    q   The rapid growth in the sales of laundry liquids that use higher levels of alcohol-based surfactants
        than the corresponding powders. In contrast, sales of the latter are either flat or declining.

    q   The displacement of large volumes of linear alkylbenzene sulfonate (LAS) surfactants from the
        laundry liquids in the early 1990s by alcohol-based surfactants, largely due to the latter’s better
        compatibility with the more complex enzymes increasingly used in liquid laundry products.

    q   The likelihood that consumers are using larger than recommended doses of household detergents
        in both laundry and dishwashing, due to either a failure to understand how to use new Ultra (i.e.,
        concentrated and/or higher density) detergents or a conscious choice to do so in the belief that it
        will improve performance.

    q   Some technological improvements in the early 1990s that made it easier to incorporate alcohol-
        based surfactants at higher levels in high-density (e.g., Ultra and Ultra 2) laundry powders.

    q   Growth in the industrial uses of alcohol-based surfactants that reflects some replacement of the
        slower-to-biodegrade nonylphenol ethoxylates (NPEs).

As previously described, the strong growth in the use of alcohol-based surfactants in household detergents
in the early 1990s was largely at the expense of LAS, rather than to overall market growth. Since supplies
of detergent alcohols tightened in the late 1990s and LAS prices became increasingly attractive, further
displacement of LAS by alcohol-based surfactants is far less likely. Consequently, future growth of
detergent alcohols will be more closely tied to the growth of the household detergent market.

Overall, North American consumption of detergent alcohols is expected to increase at an average annual
rate of 3% over the 1998-2003 period. This growth projection is based on the following assumptions,
most of which have been previously discussed or are further described in the subsequent sections on
derivative types:

                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                              DETERGENT ALCOHOLS                              Detergent Alcohols
609.5000 W                                                                                       Page 23

   q   A 2.2% average annual growth in the laundry detergent market (on a washload basis) in the 1998-
       2003 period.

   q   More rapid growth for the laundry liquid products compared to powders, with the former
       achieving a 65% share on a poundage basis by 2003.

   q   A continued preference for LAS in powders and a some shift away from alcohol-based
       surfactants to LAS in laundry liquids of one major producer.

   q   A shift from NPEs to AE in the laundry products of one large producer, partly offsetting the
       reformulation noted in the preceding point.

   q   Continued growth for alcohols in personal care products, a market that is growing somewhat
       faster than household detergents.

The following sections describe the current consumption and future outlook for detergent alcohol
derivatives.


Alcohol Ethoxylates

In 1998, an estimated 805 million pounds of detergent alcohols were used in the production of detergent-
range AE that was either consumed as such or used to make other derivatives. This estimate includes the
consumption of large volumes of AE used to make AES or other derivatives. (The characteristics of AES
are described in the following section, along with those of AS, since these two surfactants have similar
properties.)

AE is produced commercially by reacting detergent-range linear alcohols with ethylene oxide in the
presence of a base catalyst such as potassium hydroxide. The alcohol used may be made from
petrochemical or natural raw materials, but the largest percentage is produced from petrochemically
derived sources. Although AE is produced from alcohols in the C12-C22 range, those in the C12-C15 range
are most frequently employed. The molar ratio of ethylene oxide to alcohol in the final product may vary
from one to forty. Products made for direct use as nonionic surfactants in laundry powders and liquids
usually contain about seven moles of ethylene oxide per mole of alcohol. AE produced for subsequent
conversion to AES most frequently contains 0.5-3.0 moles of ethylene oxide per mole of alcohol. Some of
the latter products contain a significant volume of free alcohol. However, they are sold as AE and are
regarded as such in this report. Upon sulfation, the resulting product contains both AES and significant
volumes of AS. To minimize confusion, however, this report treats all sulfated derivatives of AE as AES

The following table gives a list of AE producers in the United States and their capacities. An accurate
identification of AE capacity is extremely difficult, since the same equipment can often be used to
produce other chemical products, such as polyether polyols, alkylphenol ethoxylates, ethylene
oxide/propylene oxide block polymers or sodium isethionate.




                      © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                   DETERGENT ALCOHOLS                                        Detergent Alcohols
609.5000 X                                                                                                      Page 24

                               North American Producers of Linear Alcohol Ethoxylates
                                              Annual Capacity
             Company and                   as of January 1, 2000a
             Plant Location                 (millions of pounds)                       Remarks

     ABITEC Corporation
        Janesville, WI                               10             Makes only small quantities for captive use.

     BASF Corporation
        Clear Lake, TX                               50
        Gurnee, IL                                   35
        Spartanburg, SC                                            Most AE converted to EO/PO block
        Washington, NJ                             110
                                                                    copolymers.
        Wyandotte, MI                  
     Clariant Corporation
          Clear Lake, TX                            220             Large supplier to household detergent
          Mount Holly, NC                            25             market.

     Cognis Corporation
         Charlotte, NC                 
                                                   100
         Mauldin, SC                   

     CONDEA Vista Company
        Lake Charles, LA                            180             Large supplier mainly to household detergent
                                                                    market.

     Croda, Inc.
         Mill Hall, PA                                5             Very small volume of specialties for various
                                                                    applications, mainly in personal care.

     Crompton Corporation
         Harahan, LA                   
                                                   100
         Houston, TX                   

     Ethox Chemicals, LLC
         Greenville, SC                             100             Serves smaller-volume customer.

     Harcros Chemicals Inc.
       Harcros Organics Division
         Kansas City, KS                             60             Sells largely to industrial and institutional
                                                                    cleaning companies.

     Heterene Chemical Co., Inc.
         Paterson, NJ                                30             Sells small volumes into personal care and
                                                                    household cleaning markets.

     Huntsman Corporation
         Dayton, TX                                  75
         Guelph, Ontario, Canada                     75
         Port Neches, TX                            350             Large supplier mainly to household detergent
                                                                    market.

     Lambent Technologies
        Skokie, IL                                   20             Very small supplier of specialties.




                          © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                         DETERGENT ALCOHOLS                                     Detergent Alcohols
609.5000 Y                                                                                                         Page 25

                            North American Producers of Linear Alcohol Ethoxylates (continued)
                                                    Annual Capacity
                 Company and                     as of January 1, 2000a
                 Plant Location                   (millions of pounds)                     Remarks

       Milliken & Co.
        Milliken Chemical Division
            Inman, SC                                       20            Small producer, that largely consumes its AE
                                                                          in formulated textile auxiliaries.

       Rhodia Inc.
         Consumer Specialties Division
           Marcus Hook, PA                                 100
           Spartanburg, SC                                  50

       Shell Oil Company
         Shell Chemical Company,
         division
            Geismar, LA                                    785            Largest supplier to the household detergent
                                                                          market.

       Stepan Company
            Millsdale, IL                                   40
            Winder, GA                                     130

       Tomah Products, Inc.
          Reserve, LA                                       30            Supplies products for industrial and
                                                                          institutional cleaning companies and other
                                                                          smaller markets.

       Uniqema
           New Castle, DE                                   75

       a.    Capacities are given to provide order of magnitude only.

       SOURCES:       (A) 1999 Directory of Chemical Producers—United States, SRI International.

                      (B) CEH estimates.



Recent major changes in the companies in the AE industry during the 1997-2000 include the following:

   q        ABITEC Corporation was acquired by Associated British Foods PLC in the United Kingdom
            from Karlshamns AB of Sweden.

   q        BASF acquired the Specialty Chemicals Group of PPG Industries, Inc., including the
            ethoxylation plants in Clear Lake, Texas and Gurnee, Illinois.

   q        Petroferm Inc. acquired the former Calgene Chemical, Inc. and renamed it Lambent
            Technologies.

   q        CONDEA Vista increased the size of its Lake Charles, Louisiana ethoxylation unit from 90
            million to 180 million pounds per year.

   q        Celanese Corp. spun off its chemical business and the plants listed in the table became part of
            Clariant Corporation.

                              © 2000 by the Chemical Economics Handbook—SRI International
May 2000                              DETERGENT ALCOHOLS                             Detergent Alcohols
609.5000 Z                                                                                      Page 26

   q   The Henkel Group spun off its chemical activities, including Henkel Corporation, which became
       Cognis Corporation on January 1, 2000.

   q   ICI combined its former ICI Surfactants unit, including the ethoxylation plant in New Castle,
       Delaware, with other newly acquired surfactant and oleochemical businesses to form Uniqema.

   q   Rhone-Poulenc Inc. spun off its chemical businesses, forming Rhodia Inc.

   q   Shell Chemical Company sold its Reserve, Louisiana ethoxylation plant to Tomah Products, Inc.

   q   Witco Corporation merged with Crompton and Knowles to become CK Witco Corporation, and
       then changed its name to Crompton Corp. in 2000.

CEH estimates of the U.S. production of detergent-range linear AE from 1980 from 1996 and North
American Production for 1997-1998 are outlined in the following tables. The estimates include the
production of AE used as such, as well as AE used for the production of derivatives, including AES,
ethoxylated and propoxylated alcohols and alcohol ether phosphates.

                        U.S. Production of Detergent Alcohol Ethoxylates—1980-1996
                                            (millions of pounds)


                        1980                                                  557
                        1981                                                  579
                        1982                                                  627
                        1983                                                  669
                        1984                                                  671

                        1985                                                  750
                        1986                                                  799
                        1987                                                  834
                        1988                                                  814
                        1989                                                  820

                        1990                                                  852
                        1991                                                  797
                        1992                                                  770
                        1993                                                  943
                        1994                                                  922

                        1995                                                 1,021
                        1996                                                 1,200

                        SOURCE:     CEH estimates.



                        North American Production of Detergent Alcohol Ethoxylates
                                          (millions of pounds)


                        1997                                                 1,301
                        1998                                                 1,312

                        SOURCE:     CEH estimates.




                     © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                DETERGENT ALCOHOLS                                Detergent Alcohols
609.5001 A                                                                                           Page 27

U.S. exports of AE exceed imports, but amount to only about 5% or less of total production. Thus, U.S.
consumption of AE in most years is probably only about 10-60 million pounds less than the production
volume shown in the preceding table.

About 60% of AE consumption (as is or as AES) is for use in household laundry products. The ultimate
performance of a surfactant in a detergent product will vary with a number of factors, including its
interaction with various builders (e.g., phosphates, zeolites and carbonates) and other ingredients (e.g.,
enzymes); the hardness and temperature of the wash water; the type of stain and the fabric type. However,
detergent manufacturers evaluate surfactants on a cost/performance basis, so that the price of a surfactant
is perhaps its most important “property.”

The relative costs of the competing surfactants depends to a significant extent on the prevailing prices of
their raw materials (coconut oil and ethylene for detergent alcohols and their derivatives; benzene and n-
paraffins for the major competing surfactant, LAS). Since these raw material prices vary considerably
over time, so do the prices of the surfactants derived from them and their relative cost/performance
advantages. As a result, there have been major reformulations, reflecting cycles in the cost of ethylene,
crude oil and other raw materials, creating a very dynamic market. In addition, the economics also vary
considerably among manufacturers, reflecting their own production and processing capabilities and
various other considerations.

The very strong growth in AE production and consumption in the last decade has largely been associated
with the strong growth in sales of laundry liquids During the early 1990s, large volumes of LAS were
displaced from laundry liquids by both AE and AES (derived from AE), due to compatibility problems
between LAS and the complex enzymes increasingly used in these products. LAS tends to deactivate
enzymes in solution over time, whereas the alcohol-based surfactants have better compatibility with
enzymes and provide equivalent or superior performance at lower levels than LAS. Newer technology,
however, is expected to permit the renewed use of LAS in 2000 in some liquid products from which it
was displaced. This change will likely be at the expense of the alcohol-based surfactants.

The alcohol-based surfactants are also less hard-water sensitive than LAS, an important advantage in the
weakly built liquid systems (i.e., built with citric acid). AE also competes with other nonionic surfactants,
especially alkylphenol ethoxylates (APE). The latter have properties similar to those of AE but are much
slower to biodegrade; consequently, many detergent manufacturers do not use APE. Indeed, one large
manufacturer switched the nonionic surfactant in its laundry formulations from APE to AE in early 2000.
Nevertheless, some small detergent producers still use APE because it is far less expensive than AE and
may also be superior in some cleaning applications.

AE consumption (as such and in the form of AES) also increased in laundry powders at the expense of
LAS in the early 1990s. In part, this reflected the growing use by detergent manufacturers of partial
agglomeration, which has makes possible the use of higher levels of AE. The resulting products have the
advantage of using a synergistic combination of LAS and AE in powders—the practice in many liquid
laundry detergents for many years. However, the level of AE in powders is unlikely to match that in
liquids, as LAS still has some processing advantages over AE. In addition, powders contain more
effective builders (i.e., zeolites and carbonates) than the liquids; thus, AE’s advantage of greater hard-
water tolerance and better tolerance of enzymes will continue to be less important than in liquids, where
effective builders are absent. In fact, some detergent manufacturers began using more LAS at the expense
of AE or AES in early 1996. These shifts reflected price/performance considerations based on changes in
raw material costs. Although enzymes are also used in laundry powders, exposure to LAS in the solid
state does not present any problems. The deactivation of enzymes by LAS upon solution is quite slow;
consequently, this problem is not significant during the short washing cycle.

                        © 2000 by the Chemical Economics Handbook—SRI International
May 2000                               DETERGENT ALCOHOLS                                Detergent Alcohols
609.5001 B                                                                                          Page 28

Because AE is so effective at removing body oils, it produces excessive dryness and irritates the skin.
Consequently, AE is generally not employed at significant levels in light-duty liquid detergents,
shampoos or other products that contact the skin directly. Instead, the much milder AES or AS is used as
the major surfactant in applications involving significant skin contact. Very low levels of specialty AE are
used as emulsifiers in cleansing creams and a few other personal care products. However, in these special
applications, other milder ingredients are used at much higher levels than AE to offset any adverse effects
of AE on the skin. Consumption of AE (in the form of AES) in hand dishwashing liquids also increased at
the expense of LAS during the early 1990s, as manufacturers sought to improve the mildness of these
products. Furthermore the new Ultra products introduced in the late 1990s have higher surfactant
concentrations and consumers, out of habit, may be using higher than required dosages, thus increasing
consumption of all surfactants used in these products.

There has also been some increased consumption of AE and AES in several newly introduced or
reformulated household hard-surface cleaners.

AE and AES derived from it are used in industrial, institutional and commercial cleaning products
somewhat similar to those used for household applications. Other industrial applications include their use
in textiles, in agricultural herbicide formulations (as emulsifiers) and in emulsion polymerization. In
many industrial applications, AE competes with APE, which tends to dominate these markets because it is
lower in cost than AE. APE is also lower in viscosity and lower melting than AE, an important advantage,
as liquids are easier to process than powders in most applications. However, concern about APE’s much
slower biodegradation and other environmental issues has resulted in some slow replacement of APE by
AE, further accelerating the overall growth of AE.

Growth in the U.S. consumption of detergent alcohols for AE is expected to average 3.3% per year over
the 1998-2003 period.


Alcohol Sulfates and Ether Sulfates

An estimated 60 million pounds of detergent alcohols were consumed in the production of AS in 1998.
Although the consumption of detergent alcohols to make AES was included in the previous section on AE
(since AES is made from AE, rather than directly from alcohols), the properties and production of both
AES and AS are described in this section, as they are closely related. Detergent-range AS and AES are
manufactured by sulfur trioxide or chlorosulfonic acid sulfation of C12-C 18 linear alcohols and their
ethoxylates, respectively, followed by neutralization to the sodium, ammonium or triethanolamine salts.

U.S. producers of AS and AES are listed in the CEH Surfactants, Household Detergents and Their Raw
Materials marketing research report. Among the producers listed, only Cognis and P&G have captive
supplies (within the United States) of detergent-range alcohol raw material.

CEH estimates of U.S. production of AS and AES for 1980-1996 and for North America for 1997-1998
are shown in the following tables. These estimates are derived from totaling individual estimates of
consumption in each end-use market segment and a small additional volume for exports (i.e., stock
changes are assumed to be almost negligible and exports are assumed to be less than 10 million pounds
per year).




                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                              DETERGENT ALCOHOLS                               Detergent Alcohols
609.5001 C                                                                                        Page 29

                                 U.S. Production of AS and AES—1980-1996
                                            (millions of pounds)


                         1980                                               544
                         1981                                               575
                         1982                                               597
                         1983                                               628
                         1984                                               626

                         1985                                               671
                         1986                                               694
                         1987                                               746
                         1988                                               749
                         1989                                               760

                         1990                                               711
                         1991                                               722
                         1992                                               675
                         1993                                               722
                         1994                                               922

                         1995                                              1,007
                         1996                                                947

                         SOURCE:     CEH estimates.



                                 North American Production of AS and AES
                                           (millions of pounds)


                         1997                                              1,092
                         1998                                              1,177

                         SOURCE:     CEH estimates.



The above estimates show growth has been only about 4% per year over the fifteen-year period from
1980 to 1995. Growth at about 3-4% per year continued in the United States over the 1995-1998 period.
Inclusion of Canadian consumption further added to the apparent growth for 1997 and 1998. The very
rapid growth in these surfactants in the 1992-1995 period (about 14% per year) resulted largely from the
displacement of LAS by AES in several product categories, as previously described, and recovery of
consumer detergent and industrial sales following the recession of the early 1990s. Over the 1998-2003
period, the overall North American consumption of detergent alcohols for AS only in all applications is
expected to increase at an average annual rate of about 2.1% (growth in detergent alcohols for use in AES
consumption has been included in projected growth for AE, from which AES is derived).

Both AS and AES are consumed as surfactants in household laundry detergents (powders and liquids),
liquid dishwashing detergents, general-purpose household cleaners and personal care products. They are
also used in a variety of industrial, institutional and commercial applications. The following discussion
describes the use of these surfactants in each end-use area.




                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                DETERGENT ALCOHOLS                             Detergent Alcohols
609.5001 D                                                                                        Page 30

Laundry detergents

AS and AES are used in some household laundry detergents, especially those of P&G. Nearly all of these
surfactants for laundry applications are produced by the sulfation of AE derived from C12-C15 alcohols
containing 0.5 to 2.5 moles of ethylene oxide. Thus, some free alcohol (i.e., with no ethylene oxide
added) is always present, leading to the production of AS, as well as AES. This report treats all of the
resulting product as AES, since it was prepared from products sold as ethoxylates and laboratory analysis
of the resulting mixture is difficult and imprecise in any case. AES competes with LAS and with nonionic
surfactants (mainly AE) in laundry products. In fact, all three of these surfactants are used in some
laundry powders.

Each surfactant has its own characteristic advantages and disadvantages. AS provides good foaming and
detergency; however, it is generally very sensitive to hard-water ions, especially in the absence of
phosphate builders. AES has much better hard-water sensitivity than either LAS or AS. Consequently, the
use of AES had initially increased as phosphate levels were reduced. The major disadvantage of AES is
its high cost compared with that of LAS. This is especially true when ethylene prices are high as in the
late 1980s and in 1995. AES in laundry products is most often derived from ethylene-based synthetic
alcohols and ethylene oxide.

Overall, household laundry detergents (powders and liquids) accounted for the consumption of about 665
million pounds of AES (including any AS, as explained above) in North America in 1998.


Dishwashing liquids

About 253 million pounds of AES were consumed in household light-duty (hand dishwashing) liquids in
1998. AES is frequently used in combination with LAS and a fatty alkanolamide or in some formulations
with AS and other surfactants (e.g., fatty amine oxides or alkylbetaines). AES has good grease-cutting
properties and is very mild to the skin, an ideal combination of properties for this use. Growth in the
consumption of AES in this application is largely tied to growth in the overall product category. The use
of dishwashing liquids has grown very slowly in recent years because of inroads by automatic
dishwashing powders.


Other household cleaners

About 19 million pounds of AES and AS (almost entirely AES) are also used in various household
cleaners, especially hard-surface, rug and upholstery cleaners. Since the mid-1990s, there has been good
growth in germicidal disinfectants used to clean household kitchen counters; these products often contain
AES.


Personal care products

In 1998, about 63 million pounds of AS and 93 million pounds of AES were consumed in shampoos,
bubble baths, toilet soaps (both bar and liquid) and other personal care products in the North America.
Shampoos represent the largest use for both AS and AES in this category, split almost evenly between AS
and AES. When used in personal care products, both of these surfactants are almost always based on C12-
C 14 alcohols derived from either natural sources (e.g., coconut oil) or from petrochemical sources via
Ziegler chemistry. Synthetic alcohols derived from oxo chemistry are seldom used. The AES used

                         © 2000 by the Chemical Economics Handbook—SRI International
May 2000                               DETERGENT ALCOHOLS                                Detergent Alcohols
609.5001 E                                                                                          Page 31

normally contains only one or two moles of ethylene oxide and both AS and AES are normally used as
sodium, ammonium or triethanolamine salts in this application. AS is preferred for its good detergency
and high foam; however, AES is less irritating to the skin and eyes, an important property, since there has
been a general trend toward milder personal care products. Both AS and AES compete with other
surfactants, including alpha-olefin sulfonates and amphoterics, for use in shampoos.

A rapidly growing use for AES has been in liquid soaps (frequently referred to as body washes). Smaller
volumes of AS and AES are used in bubble baths, toilet bar soaps, toothpaste and other personal care
products. Growth in most personal care applications using these surfactants has been about 2.0-2.5% per
year; a similar growth for AS and AES in this market is likely in 1998-2003.


Industrial, institutional and commercial uses

About 27 million pounds of AS and 57 million pounds of AES were used in institutional and commercial
cleaning products and industrial applications. Along with institutional and commercial cleaning, the
largest applications are emulsion polymerization and emulsifiers for agricultural herbicides.


Polymethacrylate Esters

Methacrylate acid esters of detergent-range alcohols are produced largely for captive use in the
production of polymethacrylate esters, which in turn are employed in automotive and aircraft lubricating
(motor) oils, as well as in transmission and hydraulic fluids. As additives in these applications, the
polymethacrylate esters function as viscosity index improvers, pour-point depressants and polymeric
dispersants. An estimated 25 million pounds of detergent alcohols were consumed for this use in 1998.
RhoMax is by far the largest supplier of these products. Ethyl Corporation (which purchased the
lubricating oil additive business of Texaco Inc.) is the only other significant producer.

The use of polymethacrylates as viscosity index improvers in motor oils had been declining for many
years, mainly because of competition from alternate products based on lower-priced olefin copolymers
and hydrogenated styrene-isoprene block polymers. The latter two product types are used largely in motor
oils, where they have almost completely displaced the polymethacrylate esters. However, the
polymethacrylate esters remain the product of choice in automotive and industrial hydraulic oils (e.g.,
automatic transmission fluids and tractor hydraulic fluids) and gear oils. Smaller quantities are also used
as pour-point depressants in crankcase oils. Their largest use is in automatic transmission fluids, where
their market share is nearly 100% in North America. Significant quantities of polymethacrylate esters are
also exported to other world areas, where their use in motor oils is still significant.

Ciba Specialty Chemicals Corporation (its former CPS Chemical Company, Inc. unit) makes small
volumes of various methacrylate esters based on detergent alcohols for use in a variety of specialized
industrial applications. Their largest use is believed to be as additives to polymers used in adhesives and
coatings. The total volume of detergent-range alcohols for this small application is believed to be far less
than one million pounds annually.

The Lubrizol Corporation may continue to use very small volumes of detergent-range alcohols to produce
a styrene-based product used as a viscosity index improver in auto transmission fluids. This market is
very small and declining.




                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                               DETERGENT ALCOHOLS                                Detergent Alcohols
609.5001 F                                                                                          Page 32

The consumption of detergent alcohols for polymethacrylate esters will probably increase at 1% per year
during the 1998-2003 period.


Fatty Nitrogen Derivatives

Most fatty nitrogen derivatives are obtained from fatty acids and some are based on linear alpha-olefin
raw materials; however, detergent alcohols are used to produce a portion of the fatty nitrogen compounds
made in the United States. Predominant among these derivatives are alkyldimethylamines, which are
made by reacting the detergent alcohols or their halide derivatives with dimethylamine. The resulting
alkyldimethylamines are converted to a number of derivatives, including alkylbenzyldimethylammonium
chlorides (by reaction with benzyl chloride), fatty amine oxides (by reaction with hydrogen peroxide) and
alkylbetaines (by reaction with chloroacetic acid). All of these derivatives may also be made from linear
alpha-olefins and both routes are used commercially.

Alkylbenzyldimethylammonium chlorides, in which the alkyl group is in the C12-C16 range, are used as
active ingredients in fungicides, algicides, biocides, sanitizers and disinfectants for use in hospitals,
dairies, food processing plants, industrial plants, swimming pools and other environments where
disinfecting is required. (See the CEH Linear alpha-Olefins marketing research report for further
information.) Some alkylbenzyldimethylammonium chlorides are also used in hair conditioners and
shampoos for their conditioning properties. Lonza Inc. uses this route to make its quaternary ammonium
compounds.

Fatty amine oxides are surfactants used in light-duty dishwashing liquids, household cleaners, personal
care products and a few specialized industrial applications. Most of these products are derived from the
linear alpha-olefin route, but Lonza produces some fatty amine oxides from detergent alcohols.

Most dialkyldimethylammonium quaternaries are derived from the corresponding fatty acids; however,
Goldschmidt’s Mapleton plant (formerly owned by Witco) may still produce at least one of its specialty
quaternaries from a detergent alcohol. The product is a liquid at room temperature and has greater
solubility than similar quaternaries derived from tallow fatty acid. Liquidity is achieved by incorporating
some branched-chain (i.e., oxo process) detergent alcohols during production. This specialty quaternary is
used in fabric softeners and its production probably consumes less than one million pounds of detergent
alcohol per year.

Lonza also produces alcohol-derived dialkyldimethyl quaternaries that are used as germicides; however,
the starting alcohols contain only eight to ten carbon atoms and are outside the detergent range.

Tomah Products, Inc. produces ether amines from fatty alcohols by reaction of the latter with acrylonitrile
followed by hydrogenation. Alcohols in the C8 -C12 range are employed and the resulting products are
used in mining (i.e., ore flotation) applications, where they compete with C 12-C16 primary amines.
Consumption of detergent-range alcohols in this application is estimated at about 3 million pounds for
1998.

Other small-volume fatty nitrogen derivatives are probably produced from detergent alcohols. It is
estimated that a total of about 20 million pounds of detergent alcohols were required for the production of
all nitrogen derivatives in 1998. Although many of the end-use products are growing well, further growth
in the biocidal and hair conditioning quaternaries via the route from detergent alcohols may already be
capacity-limited. Thus, growth of only about 1% per year is expected over the 1998-2003 period, unless
capacity is expanded.

                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                               DETERGENT ALCOHOLS                                Detergent Alcohols
609.5001 G                                                                                          Page 33

Alkyl Glyceryl Ether Sulfonates

About 16 million pounds of detergent alcohols were used in the production of an estimated 27 million
pounds of AGES in 1998. AGES is prepared by the catalytic reaction of detergent-range alcohols with
epichlorohydrin. Further reaction of the product with a sodium sulfite/bisulfite solution yields the
sulfonate salt. Either natural or synthetic alcohols can be used.

AGES having alkyl chain lengths in the C 12-C14 range is a good wetting, emulsifying and foaming agent.
It has been used as a foam-boosting surfactant in light-duty liquid dishwashing formulations, shampoos
and combination soap-synthetic toilet bars. AGES can also function as an opacifying and thickening agent
in such products and is a good lime-soap dispersant. However, the AGES surfactant is derived from
relatively expensive epichlorohydrin and it requires processing more complex than that for the alternate
surfactants. Thus, it cannot compete with the lower-cost surfactants (i.e., LAS, AS and AES) in most
applications.

Zest®, a combination soap–synthetic detergent deodorant toilet bar produced by P&G, still contains
AGES along with other surfactants and P&G’s highly successful Oil of Olay® lotion also contains AGES.
The continued growth of the latter product has led to increasing consumption of AGES in recent years,
following a long decline in its use during the 1970s and 1980s.

AGES was once used in P&G’s Head & Shoulders ® shampoo and in its light-duty liquid dishwashing
detergents (Joy®, Ivory® Liquid and Dawn®) but was withdrawn because of the high cost.

Unless P&G makes some new product introductions using AGES as a surfactant, little to no growth in the
consumption of detergent alcohols to make AGES is expected over the 1998-2003 period.

The intermediate epichlorohydrin adduct of detergent alcohols is also used as a diluent for epoxy resins.
Some of the consumption of detergent alcohols for this application may be included in the consumption
data for AGES for the period up to 1994. Beginning in 1995, the adduct for this application has been
made in Europe.


Alkyl Polyglucosides

Detergent alcohols can react with sugar molecules (e.g., glucose) to APG. Henkel (now Cognis)
Corporation built a 50 million pound-per-year APG plant in Cincinnati, Ohio that came on stream in
1993. This nonionic surfactant has good solubility, good foaming properties and mildness, and reportedly
can be used effectively in laundry, hand-dishwashing and personal care products. APG is used as a
cosurfactant in one of Colgate-Palmolive Company’s dishwashing liquids and in some liquid hand soap
and facial wash products. It is also used in some laundry liquids and hard-surface cleaners in combination
with other surfactants. Altogether, these uses account for about 16 million pounds of detergent alcohols,
which produce about 43 million pounds of APG. Assuming capacity is increased, growth in consumption
in APG and detergent alcohol raw material is expected to average 6% per year.


Hindered Phenols

Alkyl ester derivatives of hindered phenols are used as antioxidants in various plastics. One of these
products is an ester of stearyl alcohol, believed to have consumed about 8.5 million pounds of this alcohol
in 1998. The largest manufacturers of this product are Ciba Specialty Chemicals Corporation, whose

                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                DETERGENT ALCOHOLS                                 Detergent Alcohols
609.5001 H                                                                                            Page 34

product trade name is Irganox® 1076 and Cytec Industries. Growth in the consumption of detergent
alcohols in this application is expected to average 3.5% per year over the 1998-2003 period.


Thiodipropionate Esters

Higher alcohol esters of thiodipropionic acid function as antioxidants and are particularly effective in
stabilizing polyolefins. To a lesser extent, they are used as oxidation inhibitors in elastomers and cellulose
acetate. The most important use for these esters is in synergistic combination with primary antioxidants
such as hindered phenols to provide oxidative and thermal stabilization to high-volume thermoplastic
polymers. When the two are used in combination, the ratio of thiodipropionate ester to primary
antioxidant is usually three or four to one and the actual loading of thioester may vary from 0.5 to 1.0 part
per hundred parts of resin.

The higher alcohols currently used in the manufacture of thiodipropionates are lauryl, stearyl and tridecyl
alcohols. Myristyl alcohol is no longer used. The higher-molecular-weight stearyl (C18) alcohol yields
thiodipropionates with lower volatility than those made from lauryl (C12) alcohol. This characteristic
ensures that less of the antioxidant in a plastic is lost during processing at high temperatures. However,
the distearyl ester is not as soluble in plastics as the dilauryl derivative. These products are made by Cytec
Industries, Hampshire Chemical Corporation (now part of The Dow Chemical Company), Morton
International, Inc. (now part of Rohm and Haas Company) and Crompton Corporation.

For applications that are not regulated by the U.S. Food and Drug Administration (FDA), the nonlinear
derivative of tridecyl alcohol (which is not a detergent alcohol as defined in this report) is preferred
because of its lower cost. However, thiodipropionate esters prepared from food-grade C12 and C1 8
detergent alcohols are used when necessary to comply with FDA standards. Because many plastics
containing thiodipropionate antioxidants are used as food wrap, in plastic bottles or in other food-contact
applications, most users of thiodipropionates choose those that are FDA-approved for use as indirect food
additives (i.e., products that could become potential additives through their use in materials such as
packaging that come in contact with food).

The North American production of thiodipropionates based on lauryl and stearyl alcohols amounted to
7.5-8 million pounds in 1998. In turn, this production required about 6 million pounds of the
corresponding detergent alcohols.

Growth in the sale of these products has been much slower than that of the plastics in which they are
used. One reason is that plastic producers use lower levels of thiodipropionates than they did 15-20 years
ago. In some cases, this situation may only have represented cost/performance optimization; however,
odor problems and some incompatibility between thiodipropionates and the hindered amines used as light
stabilizers in plastics also have contributed to this lack of growth.

Growth in the consumption of detergent alcohols for thiodipropionates is likely to be about 2.2% per year
over the 1998-2003 period.




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May 2000                                DETERGENT ALCOHOLS                               Detergent Alcohols
609.5001 I                                                                                          Page 35

Other Derivatives

It is estimated that 15 million pounds of detergent alcohols were consumed in a wide variety of specialty
derivatives in 1995, some of which are outlined below. Because there are so many different types, often
with small volumes, assigning any meaningful growth rate is difficult, but an average growth of about
2.5% per year would be a reasonable estimate for the 1998-2003 period.


Ethoxylated and propoxylated alcohols

Some detergent-range alcohols are ethoxylated and propoxylated to produce surfactants for a variety of
uses, for example, as demulsifiers and antifoaming agents for oilfield and refinery applications. Most
companies that produce these products do not separately isolate or purchase an AE before reacting with
propylene oxide. Thus, this consumption of detergent alcohols is treated separately from the consumption
of AE. The major producer of these products is BASF Corporation.


Alcohol phosphates and ether phosphates

Detergent alcohols can be phosphated or ethoxylated and phosphated to produce surfactant derivatives.
U.S. production of derivatives based on detergent-range alcohols probably amounted to 6-10 million
pounds in 1998 and consumed 4-8 million pounds of detergent alcohols. Most of these derivatives were
consumed in textile applications as lubricants and wetting agents. Some consumption also occurred in
agricultural chemicals and in paper manufacturing. As many as twenty companies may manufacture these
products. This market is highly fragmented and difficult to analyze, but continued growth is expected.


Esters of fatty acids

Cetyl (i.e., hexadecyl), lauryl and myristyl alcohols are used by ISP Van Dyk Inc. for the production of
cetyl, lauryl and myristyl lactates. These esters are emollients designed for use in cosmetic and
pharmaceutical applications. U.S. consumption of higher alcohols for lactates is estimated to have been
less than one million pounds in 1998. Consumption of these lactates has declined because of stability
problems and their replacements are not based on detergent alcohols. ISP Van Dyk and Scher Chemicals,
Inc. also use myristyl alcohol for the production of myristyl myristate. This ester is a wax designed for
use in cosmetic emulsions as an emollient and coemulsifier and for viscosity control. Other esters based
on detergent alcohols made by Scher include myristyl propionate, oleyl oleate and stearyl erucate, all of
which are emollients in cosmetics.

Scher Chemicals also uses stearyl alcohol for the production of stearyl stearate, which has FDA approval
for use in surface lubricants. These lubricants are employed in manufacturing metallic articles from rolled
foil that contacts food.

Lauryl alcohol is used by Houghton International Inc. for the production of dilauryl maleate. This
unsaturated ester is recommended for use in the formulation of specialty lubricants designed for bearing
surfaces composed of aluminum and its alloys, which cannot be satisfactorily lubricated with ordinary
extreme-pressure lubricants. Consumption of detergent alcohols in this application was far less than one
million pounds in 1998 and has been declining.




                        © 2000 by the Chemical Economics Handbook—SRI International
May 2000                               DETERGENT ALCOHOLS                               Detergent Alcohols
609.5001 J                                                                                         Page 36

Alcohol phosphites

GE Plastics (a part of General Electric Company) produces the following derivatives based on detergent
alcohols. They are used as antioxidants or stabilizers in plastics.

    q   Distearyl pentaerythritol diphosphite (DSPTDP), an antioxidant for polyolefin film that has FDA
        approval for use in food wrappings

    q   Trilauryl trithiophosphite (TLTTP)

DSPTDP is an antioxidant for polyolefins, a use that is growing. TLTTP is a heat stabilizer for polyvinyl
chloride (PVC), in which it prevents discoloration and decomposition during processing. Its growth has
been very good in recent years. These products consumed less than one million pounds of detergent
alcohols annually in recent years.


Benzophenones

A long-chain alkyl-substituted benzophenone, 4-dodecyloxy-2-hydroxybenzophenone (DOBP), is made
by Ferro Corporation. The dodecyl substituent is introduced into the molecule from the corresponding
halide, which in turn is probably derived from the dodecyl alcohol. Substituted benzophenones function
as ultraviolet light absorbers or stabilizers. The product is used in polyolefins and PVC, where the long-
chain alkyl group promotes compatibility.


Free Alcohols

C12-C18 fraction

A number of applications use the free detergent alcohols as such. Most of these applications involve their
lubricating, emollient, solubilizing or emulsifying properties. The total consumption of free alcohols
(C12-C18 range) in 1998 is estimated at 41 million pounds. Some of the uses are outlined in the following
paragraphs. Consumption in these applications is expected to grow at an average annual rate slightly over
1.5% for the 1998-2003 period.

Cosmetics and toiletries. It is estimated that 32-34 million pounds of detergent alcohols are used in
cosmetics, mainly as emollients. Nonlinear alcohols, such as the Guerbet alcohols produced by Cognis
Corporation, are also used in this application but are not included in this estimate, because they are
outside this report’s definition of detergent alcohols. Palmitic (C16) alcohol is the preferred detergent
alcohol for this application, but stearyl alcohol (C18) and oleyl alcohol (C18 unsaturated) are also used.

Rolling oils. Higher alcohols are a component of some formulated surface lubricants used in the rolling of
metallic foil or sheet stock, such as aluminum foil. Fatty alcohols are somewhat polar and the polar
hydroxyl group may be absorbed onto the aluminum surface, thereby improving the lubricity of the
mineral base oil.

Since the major application for aluminum foil is in the container and packaging industry for use in
packaging food, the surface lubricant used in the manufacture of the foil must be approved by the FDA.
Detergent alcohols are reportedly used in this application.



                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                               DETERGENT ALCOHOLS                                Detergent Alcohols
609.5001 K                                                                                          Page 37

Pharmaceutical preparations. Oleyl, cetyl and stearyl alcohol are used as emulsifying aids in the
preparation and stabilization of pharmaceutical dispersions and emulsions. For example, stearyl alcohol is
used in ointment bases and oleyl and cetyl alcohols are used in the formulation of creams that are a base
for many medicinals. The function of an emulsifying aid is to enhance the action of a primary emulsifier
in oil and water systems.

Plastics. Small volumes of detergent alcohols are used as micelle control agents in the production of
plastics via emulsion polymerization.

Detergents. Some free alcohol may be present in many detergents because of incomplete sulfation or
ethoxylation. In rare cases, this may be intentional, as the free alcohol is a foam promoter; however, this
report considers all the alcohol to have been consumed as the sulfate or ethoxylate in such applications,
even though some free alcohol may remain in an unreacted condition.


C20+ fraction

The use of Ziegler chemistry to produce alcohols unavoidably yields products with twenty or more carbon
atoms. In BP Amoco Corp.’s method, a modified Ziegler process, these higher alcohols also consist of a
large fraction of nonlinear alcohols and some hydrocarbons. The unmodified Ziegler process employed by
CONDEA Vista produces fewer products in the C20+ range. It is estimated that about 20 million pounds
of these higher-molecular-weight alcohols and other impurities were consumed in the United States in
1998 (additional quantities were exported). These products are included in the production estimates in this
report. The C20+ fraction is consumed in a multitude of end uses, including paper processing, fuel oil
additives (where fumarate esters are used), animal feeds and oil field chemicals. Growth in the
consumption of this fraction is expected to be about 2% per year over 1998-2003.


PRICE

Alcohols (C12 and higher) are available as pure alcohols and in the form of numerous mixtures. The
carbon content varies widely, as does the linearity and normality (the relationship between the percent of
primary alcohols and the percent of secondary alcohols). Thus, it is difficult to establish price
comparisons. The following table presents published list prices for specific synthetic alcohols and blends
of synthetic alcohols to show general U.S. price trends. Epal®, Alfol ® and Neodol® are trade names for
BP Amoco, CONDEA Vista and Shell alcohols, respectively.




                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                               DETERGENT ALCOHOLS                                      Detergent Alcohols
609.5001 L                                                                                                                Page 38

                 U.S. List Prices for Selected Aliphatic Alcohols (C12 and higher) from Petrochemical Sources
                                                        (cents per pound)
                                  March        February        August    November      November      October   May       December
                 Producta         1972           1977           1980       1983          1986         1989     1993        1999

C13            Neodol® 5             --            --             --          --              --      90.25c    89.25       --
C12            Alfol® 12          26.0b            na           67.5b        76c             76.5c    92.5c     92.0c     115
C12            Alfol® 14          23.0b            na           67.5b        76.5c           76.5c    92.5c     92.0c     115
C12-C14        Epal® 1214            --          36.0b          62.5b        65.5c           60.5c    71.5c     79.5c      91c
C12-C14        Alfol® 1214        18.5b          34.59b         62b          65.5c           70.5c    82.5c     81.0c      95
C12-C14        Alfol® 1412        18.0b          32.0b          62b          73c             76c      83.0c     91.0c     119
C12-C14        Alfol® 1216        22.0b          35-3b          62.5b        65.5c           70.5c    82.5c     83.0c      95
C12-C15        Neodol® 25         18.0c          37.75c         59c          65c             70.5c    80.25c    79.25c     82.25c
C12-C13        Neodol® 23         18.5c          32.75c         60c          65c             70.5c    80.25c    79.25c     82.25c
C14-C15        Neodol® 45         18.5c          32.75c         58c          65c             70.5c    80.25c    79.25c     82.25c
C14-C16        Epal® 1416            --            --            --           --              --      79.0c     73.0c      81.5c
C14-C18        Epal® 1418         16.0b          34.0b          58b          68c             68c       --       82.0c      90.5c
C16-C18        Alfol® 1618        16.0b          32-35b         60b          68c             68c      84.5c     83.0c     102.5
C16-C20        Alfol® 1620        15.5b            na           54b          65c             65c      83.0c     80.0c      93
C16-C18        Epal® 1618          --            33.0b          58b          68c             68c      83.0c     80.0c      83.5c
C20+           Epal® 20+           --             8.5b          16b          25b             25b      55.0b     56b        66.0b
C20+           Alfol® 20+          6.0b           8.0b          16b          25b             25b      58.0b     57b        70

a.   Registered trademarks.

b.   Bulk, fob plant.

c.   Price includes delivery.

SOURCE:          CEH estimates.



The prices quoted in the preceding table did not change significantly between May 1993 and early 1999.
However, only a small percentage of detergent alcohols are sold at list price. Published bulk prices for
selected natural alcohols are outlined in the following table:

                                                     U.S. List Prices for Natural Alcohols
                                                               (cents per pound)
                                          November           November       October          May      May      December
                        Producta            1983b              1986b         1989            1993     1996       1999

          C12-C14        CO 1214              65.5             60.5            78             85       78         70
          C16            CO 1695              78               81              90             90       89         75
          C16-C18        TA 1618              64               69              73             66       73         70
          C18            CO 1895              78               81              85             90       89         75

          a.     CO and TA are P&G trade names for coconut oil and tallow alcohols, respectively.

          b.     Price includes delivery charges.

          SOURCE:            CEH estimates.



The market price for large volumes of C12-C15 detergent alcohols sold for use in the sulfation market was
$0.62-0.64 in December 1999; about $0.66-0.68 in early 1998 and about $0.60-0.62 per pound in May
1996. Prices during most of 1995 were probably $0.05 per pound less than the May 1996 price. The


                                © 2000 by the Chemical Economics Handbook—SRI International
May 2000                               DETERGENT ALCOHOLS                               Detergent Alcohols
609.5001 M                                                                                         Page 39

internal transfer price for alcohols captively consumed for ethoxylation is lower but varies considerably,
depending on both alcohol and ethylene oxide prices.


TRADE

Before the mid-1960s, when most alcohols (C 12 and higher) were derived from natural fats and oils,
international trade in these alcohols was relatively unimportant. Plants to make natural alcohols were
located in several countries and the bulk of the output from each was used locally. After 1965, the rapid
buildup of synthetic alcohol production in the United States dramatically increased trade. Similar growth
in Western European capacity in the early 1980s and in the Far East in the late 1980s further increased
international trade.


Imports

U.S. imports of detergent alcohols generally amounted to less than 3% of U.S. production until the late
1980s, when imports from new natural alcohol plants in the Far East became significant. By 1994, U.S.
imports of detergent alcohols had climbed to over 10% of U.S. production.

CEH estimates of total imports of natural and petroleum-based detergent alcohols are given in the
following table:

                                     U.S. Imports of Detergent Alcoholsa
                                            (millions of pounds)


                          1975                                                13
                          1976                                                39
                          1977                                                44
                          1978                                                26
                          1979                                                15

                          1980                                                13
                          1981                                                19
                          1982                                                19
                          1983                                                20
                          1984                                                11

                          1985                                                15
                          1986                                                45
                          1987                                                70
                          1988                                                61
                          1989                                                na

                          1990                                               45
                          1991                                               46
                          1992                                               33
                          1993                                               23
                          1994                                              100

                          1995                                              125
                          1996                                              112
                          1997                                              177
                          1998                                              142
                          1999                                              120


                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                    DETERGENT ALCOHOLS                                         Detergent Alcohols
609.5001 N                                                                                                        Page 40


                          a.     Data include an estimate of the alcohol content of a product
                                 from Japan imported as a three-mole ethylene oxide adduct.

                          SOURCE:          CEH estimates.



Most U.S. imports are natural alcohols from Malaysia, Indonesia and the Philippines. The following table
shows CEH estimates of imports by country of origin:

                                           U.S. Imports of Detergent Alcohols
                                                  (millions of pounds)
                                              1995            1996           1998           1999

                      Asia/Pacific
                        Malaysia               64.5           46.5              59              54
                        Indonesia              36.5           39.0              41              35
                        Philippines             7.0            3.0              17               6.5
                        India                   4.0            7.0               7               7.5
                        Japan                   1.5            4.5               3               1
                        Other                   0.5            --                --              --

                          Total              114.0           100             127            104

                      Europe
                        Germany                 4.5           12                15              14.5
                        Netherlands             5.0            --                --              --
                        Belgium                 1.0            --                --              --
                        Other                   0.5            --                --              1.5

                          Total                11.0           12                15              16

                               Total         125.0           112             142            120

                      SOURCE:          CEH estimates.

Canadian imports of detergent alcohols from outside the United States are assumed to be small.


Exports

U.S. exports of detergent alcohols became significant when new technology for the production of
synthetic alcohols was first commercialized in the United States in 1965. By 1979, U.S. exports of
detergent alcohols accounted for about 180 million pounds or 24% of the U.S. production in that year.
Increasing capacity for detergent alcohol production in other world areas led to a reduction of U.S.
exports during the 1980s. By 1990, U.S. exports amounted to only about 10% of U.S. production. In
addition to worldwide supply/demand, the level of U.S. exports of detergent alcohols in any year may
also reflect the exchange rate for the U.S. dollar relative to most other major currencies during that year.

CEH estimates of U.S. exports of detergent alcohols for 1975-1996 are given in the following table:




                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                 DETERGENT ALCOHOLS                            Detergent Alcohols
609.5001 O                                                                                        Page 41

                                  U.S. Exports of Detergent Alcohols—1975-1996
                                               (millions of pounds)


                           1975                                                   62
                           1976                                                  104
                           1977                                                   83
                           1978                                                  156
                           1979                                                  181

                           1980                                                  132
                           1981                                                  137
                           1982                                                  131
                           1983                                                   98
                           1984                                                   76

                           1985                                                   65
                           1986                                                   81
                           1987                                                  103
                           1988                                                  106
                           1989                                                   na

                           1990                                                   70
                           1991                                                   65
                           1992                                                  124
                           1993                                                  123
                           1994                                                   97

                           1995                                                  119
                           1996                                                   80

                           SOURCES:      (A) U.S. Exports, U.S. Department of
                                             Commerce, Bureau of the Census (data
                                             for 1983-1988).

                                         (B) CEH estimates (all other data).



U.S. exports of detergent alcohols (excluding those to Canada) for 1997-1999 are shown in the following
table.

                            U.S. Exports of Detergent Alcohols, Excluding Canada
                                             (millions of pounds)


                           1997                                                 91
                           1998                                                 97
                           1999                                                126.5

                           SOURCE:       CEH estimates



The destinations for the greatest volume of detergent alcohols exported from the United States in recent
years are Western Europe and elsewhere in the Americas. The following table presents a breakdown of
U.S. exports of detergent alcohols (excluding Canada) by destination:




                      © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                 DETERGENT ALCOHOLS                           Detergent Alcohols
609.5001 P                                                                                       Page 42

                                       U.S. Exports of Detergent Alcoholsa
                                              (millions of pounds)
                                                           1998              1999

                        Latin Americas
                          Brazil                              3               16.5
                          Mexico                              7                7.5
                          Venezuela                           8                3
                          Other                               3                4

                             Total                           21               31

                        Asia/Pacific
                          Japan                              12.5              9
                          Singapore                           2                4
                          Other                               3.0              8.5

                             Total                           17.5             21.5

                        Europe
                          United Kingdom                     42.5             53.5
                          Germany                             9               11
                          Belgium                             6                7
                          Other                               1                2.5

                             Total                           58.5             74

                               Total                         97              126.5

                        a.   Excludes exports to Canada, as Canadian consumption is
                             included in North American consumption.

                        SOURCE:        CEH estimates.



MEXICO

There is no production of detergent alcohols in Mexico. In 1998, Mexico’s consumption of these alcohols
is estimated to have been 10 thousand metric tons. All of this amount was imported, largely from the
United States. Many alcohol derivatives and end-use products consuming alcohols are exported from the
United States to Mexico, rather than produced from detergent alcohols in Mexico. In addition, Mexican
laundry and hand-dishwashing liquids are largely based on LAS, rather than detergent alcohol–based
surfactants. Thus, the direct consumption of detergent alcohols in Mexico is far less than in the United
States.


WESTERN EUROPE

PRODUCING COMPANIES

In Western Europe, detergent alcohols are typically defined as saturated alcohols containing twelve to
fifteen carbon atoms and having a carbon backbone that is at least 30% linear. The range of compounds
utilized for detergent applications, however, spans from C8 to C18 , with some products being fully
branched. This report also includes all alcohols above C 11 produced by CONDEA Augusta S.p.A



                      © 2000 by the Chemical Economics Handbook—SRI International
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609.5001 Q                                                                                                     Page 43

(formerly EniChem Augusta SpA). All of these alcohols meet the biodegradability requirements of
detergent customers and government agencies.

The following table shows Western European detergent alcohol producers, plant locations and capacities.
As of January 2000, there were seven Western European producers with an estimated detergent alcohol
annual production capacity of 665 thousand metric tons. Since 1996, capacity has expanded by roughly
85 thousand metric tons or approximately 3.5% per year. About 60% of this capacity—395 thousand
metric tons—is for production of alcohols based on coconut oil and palm kernel oil or derivatives. This
percentage is quite different in the United States, where only about 30% of capacity is for natural
alcohols.

In the following list of Western European producers, the differences between detergent alcohol capacity
and total capacity as listed can be accounted for on one hand by alcohol fractions that are primarily oleo-
derived but which do not fall within the detergent range. In this case the capacity differences tend to be
less than 40%, as with TotalFina, Cognis France, Cognis Deutschland, CONDEA at Marl and Brunsbüttel
and Albright & Wilson. On the other hand, the differences can be caused by the fact that capacity is used
to manufacture substantial quantities of plasticizer alcohol products, in which cases total capacity can
supersede that for detergent alcohols by a factor even greater than three, as with Noroxo (Exxon) and
BASF.

                                 Western European Producers of Detergent Alcohols
                                     Annual Capacity
                                    as of January 2000
                                       (thousands of
                                        metric tons)

          Company and               Detergent                    Process/
          Plant Location             Alcohol     Total         Raw Material                   Products/Remarks

Belgium

Fina Oleo Chemicals N.V.
     Ertvelde                           25         30      From natural fats and     Products include C8-C18 cuts. Plant
                                                           oils                      on stream in 1989. Company owned
                                                                                     100% by TotalFina S.A.

France

Noroxo
    Harnes                              30a       130      Oxo process from          Swing production. Not only used for
                                                           alpha-olefins and other   production of detergent alcohols.
                                                           olefins for other         Products include C10 , C 11 , C 12 , C 13
                                                           products                  and C13-C15. Company owned 100%
                                                                                     by Société Française Exxon
                                                                                     Chemical, purchased by Exxon in
                                                                                     1987.

Cognis France S.A.
    Boussens                            50b        70      From natural fats and     Company owned 100% by Cognis
                                                           oils, primarily           Deutschland GmbH.
                                                           vegetable-based

Germany

BASF Aktiengesellschaft
   Ludwigshafen                         25a       100      Oxo process from          Swing production. Mainly for
                                                           alpha-olefins and other   captive use. Products include C 10,
                                                           olefins                   C13, C 13-C15.

                           © 2000 by the Chemical Economics Handbook—SRI International
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                              Western European Producers of Detergent Alcohols (continued)
                                        Annual Capacity
                                       as of January 2000
                                          (thousands of
                                           metric tons)

            Company and               Detergent                        Process/
            Plant Location             Alcohol        Total          Raw Material                  Products/Remarks

Germany (continued)

Cognis Deutschland GmbH
    Düsseldorf                            170 b        190       From natural fats and     Products include cuts in C 8 -C18
                                                                 oils                      range and unsaturated alcohols, as
                                                                                           well as Guerbet alcohols.

CONDEA Chemie GmbH
   Brunsbüttel                             30           35       From fatty acids,         Company has two plants at same
                                           35           75       Ziegler process from      location. Natural alcohol plant came
                                                                 ethylene                  on stream in 1980. Products include
                                                                                           Guerbet alcohols.

     Marl                                  85           85       Mainly from fatty         Mainly for captive use.
                                                                 acids and fatty esters

Italy

CONDEA Augusta S.p.A.c
   Augusta                                100 a        100       Oxo process based on      Back-integrated into internal olefins.
                                                                 mainly internal olefins   Products include fatty alcohols C12-
                                                                                           C 13 , C 12-C15 , C 14-C15 and special
                                                                                           cuts. Capacity expansion began in
                                                                                           1999, finalization expected in 2001.

United Kingdom

Albright & Wilson UK Limited
  Surfactants Group
     Whitehaven                            35           35       From fatty acids          Products include C 8 -C1 8 cuts.
                                                                                           Merchant sales are very low.

Shell Chemicals UK Ltd.
     Ellesmere Port                        80a         120       Modified oxo process      C12-C13, C 14-C15, C12-C15 alcohols.
                                                                 (patented Shell SHOP      Mainly for captive use. Trademark is
                                                                 process) using alpha-     Neodol®.
                                                                 olefins

        Total                             665

a.   The capacities for most oxo alcohol producers are arbitrary, as they also make products outside the detergent range.
     Production planning in plants designed for continuous use incorporates demand analysis, which consequently affects
     switchover timing and campaign length.

b.   The Cognis Group capacity for detergent alcohols in Western Europe is 220 thousand metric tons.

c.   Formerly EniChem Augusta SpA, which was acquired (majority ownership) by CONDEA Chemie GmbH in 1995 and
     renamed CONDEA Augusta S.p.A.

SOURCES:        (A) 1999-2000 Directory of Chemical Producers—Europe, SRI International.

                (B) CEH estimates.

                             © 2000 by the Chemical Economics Handbook—SRI International
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609.5001 S                                                                                        Page 45

A breakdown of the Western European capacity for detergent alcohols is as follows:

                             Western European Capacity for Detergent Alcohols—
                                              January 2000
                                                     Thousands of
                                                     Metric Tons        Percent

                           Oleo-Derived                  395              60
                           Petroleum-Derived             270              40

                               Total                     665             100%

                           SOURCE:      CEH estimates.



Precise indication of detergent alcohol capacity is dependent on product mix, which becomes particularly
complicated when a large capacity is only periodically so devoted. Beyond this, addition of new capacity
is affected by such factors as interproduct competition, whether oleo-derived or petroleum-derived, crude
oil prices or natural oil harvests.

Significant developments among the Western European producers of detergent alcohols since December
1996 are discussed below.

    q   RWE-DEA expanded CONDEA’s chemicals business, including purchasing Hüls’s surfactants
        and oleochemicals business, completed in June 1998. Included in the purchase were 85 thousand
        metric tons of detergent alcohol capacity at Marl, Germany. Expansions of detergent alcohol
        capacity at Brunsbüttel, Germany and CONDEA Augusta’s, Italian location, primarily through
        debottlenecking, were begun in 1999 and will be finalized in 2001. These increases contributed to
        the company’s overall worldwide capacity expansion program, increasing capacity from 386
        thousand to 470 thousand metric tons per year, with consumption expected mainly in surfactant
        and plasticizer markets.

    q   Cognis Deutschland GmbH assumed its position as an independent market participant following
        the carve-out of Henkel KgaA’s chemicals division in August 1999. Cognis, with locations in
        Germany and France (former Chimiques du Sidobre-Sinnova S.A.), is already Europe’s leading
        oleo-derived detergent alcohol producer, with a combined capacity of 220 thousand metric tons
        per year.

    q   Albright & Wilson modernized and debottlenecked its plant at Whitehaven in 1999. Capacity
        there for detergent alcohols now stands at 35 thousand metric tons annually.

Also of note is the continued presence of DHW Deutsche Hydrierwerke GmbH Rodleben in Sachsen-
Anhalt, Germany, which had been acquired by the Indonesian SALIM Group. The company is owned
83.89% by SALIM Deutschland GmbH. Deutsche Hydrierwerke, with a capacity of some 15 thousand
metric tons per annum, manufactures unsaturated fatty alcohols primarily for the cosmetic and food
industries. Aarhus Oliefabrik A/S of Arhus, Denmark, produces fatty alcohols in the C 16-C18 range used
primarily in cosmetics and pharmaceuticals.




                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                   DETERGENT ALCOHOLS                                   Detergent Alcohols
609.5001 T                                                                                                 Page 46

SALIENT STATISTICS

The Western European supply/demand balance for detergent alcohols since 1982 is outlined in the
following table:

                               Western European Supply/Demand for Detergent Alcohols
                                             (thousands of metric tons)
                                     Operating Rate                           Net         Apparent
                      Capacity         (percent)            Production      Exportsa     Consumption

             1982         --                --                    242          32             210

             1989        543               67                     365          50             315

             1992        583               69                     405          35             370

             1995        600               76                     455          30             425

             1998        640               80                     510          30             480
             1999        665               80                     530          30             500

             a.   Includes quantities of detergent alcohols sold either as such or consumed in products
                  subsequently exported.

             SOURCE:      CEH estimates.



Capacity utilization rates between 1995 and 1999 have been 80% and higher. Annual growth rates for
production and consumption have been a little over 4% for 1995-1999.

A breakdown of 1999 detergent alcohol production into natural and synthetic types is shown in the
following table:

                                           Western European Production of
                                             Detergent Alcohols—1999
                                             (thousands of metric tons)


                                 Oleo-Derived                                   315
                                 Petroleum-Derived                              215

                                   Total                                        530

                                 SOURCE:         CEH estimates.



Official trade statistics are published by the European Union, but these are considered to be incomplete
and inaccurate by nearly all industry sources. The estimates of net exports shown in the supply/demand
table are considered to be a more accurate reflection of actual Western European trade in detergent
alcohols. See the TRADE section for further information.




                          © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                        DETERGENT ALCOHOLS                                   Detergent Alcohols
609.5001 U                                                                                                      Page 47

CONSUMPTION

The following table shows Western European consumption of detergent alcohols by derivative type in
order of the volume consumed:

                          Western European Consumption of Detergent Alcohols by Derivative Type
                                               (thousands of metric tons)
                                                                                         Average Annual
                                                                                          Growth Rate,
                                                                                           1998-2003
                                                    1995        1998          1999          (percent)

             Alcohol Ethoxylatesa                    245          276          285                 3
             Alcohol Sulfates                         73           82           85                2.5-3
             Polymethacrylate Esters                  27           29           30                 2.0
             Fatty Nitrogen Derivatives               11           16           20                10
             Thiodipropionate Esters                   5            5            5                 0
             Other Derivatives, Alcohols Used
              as Such and C20+ Alcohols               64           72           75                 3.0

                  Total                              425          480          500                 3%

             a.   Includes AE used to make AES.

             SOURCE:         CEH estimates.



Consumption in 1999 in Western Europe is estimated to have been 500 thousand metric tons, more than
70% of which was for AE, AES and AS surfactants. Growth in these products has been driven by the
displacement of LAS surfactants by alcohol-based surfactants due to better compatibility with enzymes,
higher efficiency in low- or nonphosphate powders, environmental considerations and tighter linear
alkylbenzene (LAB) supplies with subsequently higher prices for LAB. Environmental pressures on LAS
have lessened somewhat, as life cycle analysis (LCA) studies have indicated that no one surfactant can
claim an absolutely superior biodegradability.

The value of the Western European market for laundry, cleaning and personal care products is estimated
to have been DM40 billion ($23 billion) in 1997, as indicated in the protocol of the Industrieverband
Körperpflege- und Waschmittel e.V. (IKW) for December 1999. Germany accounts for the largest
volume, followed by France, the United Kingdom, Italy and Spain. These five countries account for more
than 80% of European consumption.

During the period 1998-2003, Western European consumption of detergent alcohols is expected to
increase at a rate of about 3% per year. At this rate apparent consumption in Western Europe can be
projected to reach 590 thousand metric tons by 2004. For individual derivative products this will vary
considerably. The balance between the consumption of oleo-derived and petroleum-derived alcohols can
be expected to shift in favor of the latter, with completed expansion at CONDEA Augusta expected in
2001 and products from plants due on-stream in the United States and South Africa beginning to reach
Europe. The following sections describe Western European consumption by derivative type.




                             © 2000 by the Chemical Economics Handbook—SRI International
May 2000                               DETERGENT ALCOHOLS                               Detergent Alcohols
609.5001 V                                                                                         Page 48

Alcohol Ethoxylates

Western European consumption of detergent alcohols for AE (both for direct use and to make AES) is
estimated to have been 285 thousand metric tons in 1999 or 57% of the total Western European
consumption of detergent alcohols. Laundry detergent powders are the largest use of AE as such and the
consumption of AE in these products has grown steadily over the last few years. One major reason for
this growth is that the major competitive surfactant, LAS, is less effective than AE in the newer low- or
nonphosphate laundry powders. The use of phosphates has dropped sharply because of legislative
restrictions, outright bans and voluntary reductions in a number of European countries (although Blue
Angel labels indicating reduced content are available, particularly in Sweden, Germany, the Netherlands,
Austria, Italy and Switzerland). Both phosphate-free and phosphate-containing laundry powders—of
more limited concentration—are still marketed in France, Spain and the United Kingdom.

AE is also used in laundry liquids and particularly in the concentrated formulations that have firmly
established themselves in Western Europe. The liquid products use higher surfactant levels than
conventional powders. Although smaller volumes are used per washload compared to powders, the
volume delivered is higher in total weight because of their higher density. In 1992, superconcentrated,
heavy-duty laundry liquids were introduced in the UK market. They are three to four times higher in
concentration than conventional liquids. These products require less shelf space in the supermarkets and
also less packaging material. However, some consumers are moving back to normal-sized liquid detergent
packs, because these are perceived as giving better value for the money. In the United Kingdom the
market share of liquids in general is steady and concentrated liquids appear to be preferred over standard
formulations. In France liquids consumption appears to be declining. In Germany, liquid usage is still
growing, along with the development of new formulations.

The use of various detergent product forms in Western Europe varies greatly from country to country,
proving an interesting study in consumer behavior and in the marketing strategy of manufacturers, who
through innovative developments seek to increase overall market share. Traditionally formulated
products, standard powder and liquid formulations, maintain their appeal on the basis of their economy
and ease of use. In the 1998 Annual Review of the Association Internationale de la Savonnierie, de la
Détergence et des Produits d’Entretien (AISE), traditional powder formulations have their highest use in
Portugal, Greece, Spain and Italy, while overall accounting for 50% of detergent use in Europe. Liquid
formulations represent the least-used product form at roughly 14% overall, with the highest rates of use in
France, the United Kingdom, Belgium and Italy. Compact powder formulations now have across Europe
a market share of some 36% and are most used in the Netherlands, Germany, Switzerland and Austria.

While many products are marketed on the basis of their low price, others are offered on the basis of their
convenience or other advantages. For example, tablets are formulated for single washload and exact
dosing, features that have resulted in the tablets continuing to gain share in Western Europe. Marketed on
a broader scale across Europe in 1998, tablets in the United Kingdom have attained a market share
estimated as high as 15%. Another example is the concentrated liquids that require smaller volumes per
washload than conventional liquids, as well as less packaging material and storage space.

AE is also used in numerous industrial applications, in which it continues to displace the less
biodegradable alkylphenol ethoxylates. German detergent manufacturers have voluntarily agreed not to
use nonylphenol ethoxylates in household detergents.

AE is also used to make AES, which beyond use in laundry products is widely found in light-duty
dishwashing liquids and personal care products (mainly shampoos and bubble baths). In these two
applications, AES has been the surfactant of choice for many years in Western Europe because of its

                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                              DETERGENT ALCOHOLS                               Detergent Alcohols
609.5001 W                                                                                        Page 49

greater mildness compared with AS. This preference contrasts somewhat with the United States, where
AS continues to dominate the personal care market, although less so in recent years. While AES is long
established in the Western European personal care market, growth in this category will largely follow
growth in consumption of shampoos, bubble baths and oral care products.

The growth in consumption of dishwashing liquids in Western Europe has slowed to about 1% per year.
These products have reached market saturation, and growth in this area is correlated with growth in the
number of single households, and general population growth. Future growth for AES in this category is
forecast to continue at around 1% per year. Smaller volumes of AES are also used in some laundry
detergents, in other household cleaners and in industrial applications.

The overall growth of detergent alcohol consumption for AE (including that subsequently used to make
AES) is expected to be about 2-3% per year over the 1999-2004 period.


Alcohol Sulfates

Western European consumption of detergent alcohols for AS is estimated to have been 85 thousand
metric tons in 1999 or about 17% of the total detergent alcohol consumption. Laundry powders are the
largest application area, followed by personal care products. Smaller volumes are used in other household
detergents and in industrial and institutional applications.

Compact laundry powders and superconcentrates are formulated with AS and some LAS. Their market
penetration in the Western Europe powders sector is on the order of 36% and growing, but acceptance has
varied on a national basis. While the Netherlands, Germany, Austria and Switzerland make extensive use
of compact formulations, these products lost ground in the United Kingdom after achieving a significant
market share. Growth in the use of these compacts has resulted in a reduction in shelf space requirements
in supermarkets, a significant advantage, as shelf space is at a premium.

The overall growth for detergent alcohol consumption for AS depends in part on acceptance by
consumers and on the penetration of similar detergents in the Western European market. Overall, it is
expected that this outlet for detergent alcohols will grow at an average of around 2-3% per year over the
1999-2004 period.


Polymethacrylate Esters

It is estimated that some 30 thousand metric tons of detergent alcohols were consumed for the production
of polymethacrylate esters in 1999 in Western Europe, primarily for use as viscosity index improvers and
pour-point depressants in motor oils and hydraulic fluids. After their use declined somewhat in the early
1980s because of competition from the lower-cost olefin copolymers, the superior properties of the
polymethacrylates gradually offset their cost disadvantage in much of this market. In addition, use of
multigrade motor oils that incorporate high levels of viscosity index improvers has grown. Thus, the
consumption of polymethacrylate esters began growing again in the late 1980s and into the early 1990s.
This growth (along with that of the detergent alcohols used in them) slowed in the period from 1993 to
1995 because of the economic recession in Western Europe. Demand growth is expected to reach an
average annual rate of 2% over the 1999-2004 period.




                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                               DETERGENT ALCOHOLS                               Detergent Alcohols
609.5001 X                                                                                         Page 50

Fatty Nitrogen Derivatives

Fatty nitrogen derivatives, in particular C12-C14 amine oxides, have experienced remarkable growth in the
last several years. Historical CEH estimates of detergent alcohol consumption for these products may
have been significantly understated. It is estimated that some 20 thousand tons of detergent alcohols were
consumed in 1999 for products used in formulations for toilet and other household cleaners, including
some dishwashing liquids, bleaches and other cleaners, to which thickening agents have been added that
enhance the apparent cleaning effect. These products have experienced double-digit growth above 15%
yearly in the past and growth through 2004 is estimated at 10% per year.


Thiodipropionate Esters

It is estimated that some 5 thousand metric tons of detergent alcohols were used to make thiodipropionate
esters for use as antioxidants in thermoplastics. To stabilize polypropylene, a combination of a hindered
phenol and a thioester or phosphite at a total concentration of 0.5% antioxidant is typically used.
Thioesters are coming under increasing pressure from phosphites, which are competitively priced and
exhibit better compatibility with hindered amine light stabilizers (HALS). Thus, no growth in
consumption of thiodipropionate esters is expected over the 1999-2004 period.


Other Derivatives, Alcohols Used as Such and C 20+ Alcohols

Detergent alcohols are used in Western Europe for the production of a number of products aside of those
discussed specifically. Many of these are also used in cleaners, whether for home or industrial use, for
chemicals or for personal care products.

In 1999, consumption of detergent alcohols to produce APG in Western Europe is estimated to have been
over 8 thousand metric tons. Growth on the order of 10% per year or potentially even higher is forecast to
the year 2005.

Other derivatives based on detergent alcohols include esters of fatty acids, phosphate esters and
succinates. Consumption of detergent alcohols for all of these derivatives is estimated to have been some
20 thousand metric tons in 1999.

Detergent alcohols are also used as such (free alcohols) in cosmetics and pharmaceuticals and as rolling
oils in aluminum production.

The Ziegler alcohol process used by CONDEA Chemie GmbH coproduces alcohols in the C20+ range that
are used in a variety of applications. The European production of alcohols in the C20+ range is estimated
at about 10 thousand metric tons in 1999.

In all, it is estimated that some 75 thousand metric tons of the detergent alcohol consumed in Western
Europe in 1999 are attributed to the production of other derivatives, for detergent alcohols used as such
and for detergent alcohols in the C20+ range. The overall growth of these diverse uses will probably
average about 3% per year, with APG showing the strongest growth.




                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                         DETERGENT ALCOHOLS                                 Detergent Alcohols
609.5001 Y                                                                                                     Page 51

PRICE

Although there have been some exceptional years, historically, petroleum-derived alcohols have generally
been slightly less expensive than those based on vegetable or animal-fat origin. Most manufacturers of
personal care products prefer oleo-derived alcohols whereas the lower-cost alcohols derived from
petroleum directly are mainly used in household products. Personal care applications mostly use natural
and Ziegler alcohols, though some modified oxo-alcohols are used. Oxo-alcohols are seldom used and are
generally lower in price than natural or Ziegler alcohols in personal care applications. The following table
lists average prices for bulk quantities of various detergent alcohols:

                                         Western European Prices for Detergent Alcohols
                                                                  DM per Kilogram

                                 Natural                 Synthetic              Natural          Synthetic
                                 Alcohol                  Alcohol               Alcohol           Alcohol
                                (C12-C18)                (C12-C15)             (C12-C14)         (C16-C18)

             1985                 3.80                     3.50                      --             --
             1986                 2.90                     2.75                      --             --

             1990                 2.55                     2.70                     2.70            --

             1992                  --                      2.30                     2.30           1.90
             1993                  --                      2.00                     2.00           1.60
             1994                  --                      1.85                     1.85           1.40
             1995a                2.15                     2.35                     2.35           1.80

             1998a              2.50-2.60                2.35-2.50             2.40-2.70         1.65-1.80
             1999a              2.55-2.60                2.35-2.50             2.35-2.60         1.70-1.80


                                                 Dollars per Kilogram

                           Natural           Synthetic          Natural         Synthetic     Exchange
                           Alcohol            Alcohol           Alcohol          Alcohol        Rate
                          (C12-C18)          (C12-C15)         (C12-C14)        (C16-C18)   (DM per dollar)

             1985              1.41             1.30                 --               --         2.70
             1986              1.16             1.10                 --               --         2.50

             1990              1.57             1.67               1.67               --         1.62

             1992               --              1.46               1.46             1.21         1.57
             1993               --              1.23               1.23             0.98         1.63
             1994               --              1.14               1.14             0.86         1.62
             1995a             1.50             1.64               1.64             1.26         1.43

             1998a        1.42-1.48          1.34-1.42         1.36-1.53        0.94-1.02        1.76
             1999a        1.41-1.44          1.30-1.38         1.30-1.44        0.94-0.99        1.81

             a.     Midyear.

             SOURCE:           CEH estimates.




                               © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                  DETERGENT ALCOHOLS                                    Detergent Alcohols
609.5001 Z                                                                                                 Page 52

TRADE

The official EU statistics on trade in alcohols are regarded as unreliable by industry sources, due to the
undifferentiated reporting of product groups.

Western European imports of detergent alcohols are estimated to have been about 40 thousand metric tons
in 1999. In general, imports have been increasing slightly. They were estimated at 30 thousand metric
tons in 1992 and about 35 thousand metric tons in 1995. Detergent alcohol imports from the United States
amounted to about 21 thousand metric tons in 1992 and were the same in 1995. The remainder of the
imports came mainly from the Philippines, Indonesia and Malaysia.

Western European exports of detergent alcohols amounted to about 30 thousand metric tons in 1999, a
decrease from an estimated 65 thousand metric tons in both 1992 and 1995. Destinations included the
United States, Eastern Europe, Latin America and India. The potential for greatly increased exports has
been reduced as new natural alcohol plants have come on stream in East Asia. Expected increases in
exports of detergent alcohols, their derivatives and formulated products (e.g., detergents) to Central and
Eastern Europe have not yet materialized because of logistical problems and limited hard currency in
these countries. At the moment, most exports to Eastern Europe are in the form of finished soap and
detergent products. Growth is most significant in Hungary, Slovenia and the Czech Republic.

Global trade patterns are expected to change during 1999-2004, since new production capacity will be on
stream in the United States (Shell, Geismar, Louisiana, 135 thousand metric tons, 2001) and in South
Africa (SASOL, Secunda, South Africa, 120 thousand metric tons, year-end 2001). It seems likely that
products from these locations will appear on the world market, including the European market.


EASTERN EUROPE

The Eastern European market for detergent alcohols is small; the few known producers have been idle in
recent years. Thus the market is served by imports and consumption is not large.


PRODUCING COMPANIES

The following table lists known producers of detergent alcohols in Eastern Europe:

                                 Eastern European Producers of Detergent Alcohols
                                                    Capacity as of
                                                   January 1, 2000
                     Company Name and               (thousands of
                       Plant Location                metric tons)             Remarks

                 Poland

                 Zaklady Azotowe
                 “Kedzierzyn” S.A.
                   Kedzierzyn-Kozle                      6            Purchased in 1970; licensed
                                                                      by Lurgi. Idle since 1995.




                          © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                   DETERGENT ALCOHOLS                               Detergent Alcohols
609.5002 A                                                                                             Page 53

                             Eastern European Producers of Detergent Alcohols (continued)
                                                     Capacity as of
                                                    January 1, 2000
                     Company Name and                (thousands of
                       Plant Location                 metric tons)               Remarks

                 Russia

                 Angarskaya
                 Neftekhimicheskaya
                 Kompaniya
                   Ufa                                    24             Mothballed 1994.

                 Shebekinskiy Khizavod
                   Shebekino                              18.5           Mothballed 1995.
                 Ufaneftekhim
                   Ufa                                    25             Mothballed 1998.

                 Volgodonskiy Khimzavod
                   Volgodonsk                              6.5           Mothballed 1995.

                     Total                                80

                 SOURCE:         CEH estimates.



PRODUCTION

All the known producers in Russia and Poland are currently idle. Production by Ufaneftekhim in 1997 is
estimated to have been 500 metric tons. The table below lists production in Russia in the early to mid-
1990s.

                                       Russian Production of C10-C18 Detergent
                                                 Alcohols—1990-1995
                                              (thousands of metric tons)


                                1990                                               47
                                1991                                               44
                                1992                                               38
                                1993                                               27
                                1994                                               19
                                1995                                               19

                                SOURCE:      CEH estimates.



The Polish firm Kedzierzyn used a natural fatty acid hydrogenation process for detergent alcohol
production, but it was seldom in operation and output figures are not available. As mentioned, there is no
detergent alcohols production in other Eastern European countries.




                          © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                      DETERGENT ALCOHOLS                                     Detergent Alcohols
609.5002 B                                                                                                      Page 54

CONSUMPTION

The following table provides some information on consumption of detergent alcohols in Russia in 1997
and 1998, along with some breakdown on a percentage basis:

                                      Russian Consumption of Detergent Alcohols
                                                            1997                            1998

                                                 Quantity                        Quantity
                       End-Use                 (metric tons)       Percent     (metric tons)       Percent

             Refinery Industry (lube fat          1,225              49             921               60
             additives, etc.)

             Alcohol Ethoxylates                   700               28             445               29

             Cosmetics, Toiletries                 162.5              6.5           138.2              9

             Alkylsulfates                         400               16              15.4              1

             Specialty Chemicals                     12.5             0.5            15.4              1

               Total                              2,500             100%          1,535             100%

             SOURCE:         CEH estimates.



The figures indicate substantial drops in consumption for ethoxylates and alkylsulfates and a crisis
situation in the country’s detergent industry.

Estimates of detergent alcohol consumption for other Eastern European countries are presented in the
following table:

                                           Eastern European Consumption of
                                               Detergent Alcohols—1998
                                                     (metric tons)


                                Slovakia                                     6,000-7,000
                                Poland                                          2,000
                                Czech Republic                                    200
                                Romania                                           180
                                Bulgaria                                          150
                                Hungary                                           120
                                Slovenia                                          120
                                Croatia                                           100
                                Yugoslavia                                        100
                                Macedonia                                          50

                                SOURCE:        CEH estimates.



In Bulgaria and Romania limited quantities are consumed as such without ethoxylation or sulfation,
primarily in the refining sector or in cosmetic preparations. Hungarian consumption is primarily lauryl
alcohol used for sulfation by Phyola Kft in a plant having a capacity of some 7 thousand metric tons
annually. In the Czech Republic, Chemotex in Boletice and Enaspol in Velvety are among known
consuming companies. Enaspol consumes an estimated one thousand metric tons annually. Polish

                         © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                DETERGENT ALCOHOLS                                Detergent Alcohols
609.5002 C                                                                                           Page 55

consumption is dominated by Organika-Rokita at Brzeg Dolny, with annual use estimated at 700 metric
tons of C12-C14 alcohols and some 200 metric tons of C16-C18 products.


TRADE

The table below characterizes detergent alcohol import quantities into selected Eastern European
countries in 1998 by both importing and exporting countries.

                            Eastern European Imports of Detergent Alcohols—1998
                                               (metric tons)
                                      Hungary        Poland         Romania       Slovenia

                Belgium                   --          1,100             --           --
                Germany                   40            260           145           110
                Malaysia                  30            430            --            --
                United Kingdom            30            250            --            --
                Indonesia                 --            160            --            --
                Italy                     10             --            30            20

                SOURCE:      CEH estimates.



Imports into Slovakia are not known precisely, but are believed to originate from Germany and Italy. It is
estimated that the vast majority of these detergent alcohols are ethoxylated and then exported either as
such or in surfactant formulations.


JAPAN

PRODUCING COMPANIES

In the Japanese market, detergent alcohols are defined as alcohols containing twelve or more carbon
atoms and having a carbon backbone that is at least 70% linear. Secondary alcohols derived from
paraffins are included in this definition. However, it excludes plasticizer alcohols containing less than
twelve carbon atoms and highly branched alcohols such as those derived from propylene tetramers.
Because this report excludes alcohols below C12, derivatives based on them, such as those introduced by
Kao Corporation in its dishwashing liquid More®, are also excluded.

The total Japanese capacity for detergent alcohols in 1999 is estimated at around 108 thousand metric
tons, including secondary alcohol capacity. Of this, about 19% is for natural alcohols and the balance for
synthetic alcohols. However, estimates of the capacity of some producers using the oxo process are
somewhat arbitrary, because the same producers also make products in the plasticizer (C6 -C11) range.

The following table shows a list of Japanese detergent alcohol producers, plant locations and capacities:




                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                          DETERGENT ALCOHOLS                                       Detergent Alcohols
609.5002 D                                                                                                            Page 56

                                             Japanese Producers of Detergent Alcohols
                                            Annual Capacity
                                                 as of
                                           December 31, 1999
               Company and                   (thousands of           Product
               Plant Location                 metric tons)            Range                 Process         Raw Material

Kao Corporation
  Wakayama, Wakayama Prefecture                     (0)a        C12-C18               Catalytic       Coconut oil methyl esters
                                                                                      hydrogenation

Kyowa Yuka Company, Ltd.b
  Ichihara, Chiba Prefecture                        20c         C12-C15               Oxo             Olefins

Mitsubishi Chemical Corporationd
 Kurashiki, Okayama Prefecture e                    15f         C11, C 13, C 15       Oxo             Linear alpha-olefins
 Yokkaichi, Mie Prefecture g                        35          C12-C15               Modified oxo    Olefins from dehydro-
                                                                                      (Shell)         genation of n-paraffins

New Japan Chemical Co., Ltd.
  Kyoto, Kyoto Prefecture                           (0)a        C12-C18               Catalytic       Coconut oil methyl esters
                                                                                      hydrogenation
     Tokushima, Tokushima Prefecture               (20)         C16, C 18             Catalytic       Fats and oils
                                                                                      unsaturated

Nippon Shokubai Co., Ltd.
  Kawasaki, Kanagawa Prefecture                     18h         Secondary C 10 -      Oxidation       n-Paraffins
                                                                C12, C 12-C14

       Total                                      108

a.     Plant is currently not operating.

b.     Formerly Japan Oxocol Co., Ltd.; currently 100% owned by Kyowa Hakko Kogyo Co., Ltd.

c.     Total nameplate capacity for all higher alcohols is 150 thousand metric tons. Actual production of detergent alcohols is
       small.

d.     Mitsubishi Kasei Corporation and Mitsubishi Petrochemical Co., Ltd. were merged into Mitsubishi Chemical Corporation in
       October 1994.

e.     The plant was previously owned by former Mitsubishi Kasei Corporation.

f.     Total nameplate capacity for all higher alcohols is 30 thousand metric tons.

g.     The plant was previously owned by former Mitsubishi Petrochemical Co., Ltd.

h.     Capacity is for the secondary alcohol content of the secondary AE product manufactured.

SOURCE:           CEH estimates.



Daiichi Kogyo Seiyaku Co., Ltd. previously produced alcohols from sperm oil, but discontinued
production in April 1983. Kao Corporation ended production of detergent alcohols in Japan in 1994 and
now purchases them from its joint ventures in Malaysia and the Philippines.




                                © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                 DETERGENT ALCOHOLS                                  Detergent Alcohols
609.5002 E                                                                                              Page 57

SALIENT STATISTICS

The following table summarizes the Japanese supply/demand balance for detergent alcohols in recent
years:

                              Japanese Supply/Demand for Detergent Alcoholsa
                                         (thousands of metric tons)
                            Production          Imports      Exports        Consumptionb

                  1979          64                 2            6                 60

                  1980          52                 7            3                 56
                  1981          49                 8            4                 53
                  1982          63                 8            4                 67
                  1983          67                 8            4                 71
                  1984          68                12            2                 78

                  1985          71                12            2                81
                  1986          76                17            3                90
                  1987          84                17            3                98
                  1988          83                24            3               104
                  1989          86                27            2               111

                  1990          89                26            3               111
                  1991          93                32            2               122
                  1992          88                41            3               126
                  1993          77                40            2               115
                  1994          65                58            3               120

                  1995          61                65            2               124
                  1996          68                60            8               121
                  1997          70                61            7               123
                  1998          67                56            8               115
                  1999          68                57            7               118

                  a.   Data include the alcohol content of secondary AE produced by Nippon
                       Shokubai.

                  b.   CONSUMPTION equals PRODUCTION plus IMPORTS minus
                       EXPORTS; assumes no stock changes. Consumption may differ slightly
                       from the results of this calculation because of rounding.

                  SOURCE:      CEH estimates.



The breakdown of Japanese production of detergent alcohols by natural and petrochemical-based
(synthetic) products is outlined in the following table:




                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                  DETERGENT ALCOHOLS                                 Detergent Alcohols
609.5002 F                                                                                              Page 58

                                     Japanese Production of Detergent Alcohols
                                            (thousands of metric tons)
                                         Naturala              Syntheticb          Totalc

                         1979                23                    41                64

                         1980                19                    33                52
                         1981                20                    29                49
                         1982                24                    39                63
                         1983                23                    44                67
                         1984                18                    50                68

                         1985                23                    48                71
                         1986                32                    44                76
                         1987                38                    46                84
                         1988                40                    43                83
                         1989                39                    48                86

                         1990                42                    48                89
                         1991                44                    50                93
                         1992                40                    48                88
                         1993                33                    44                77
                         1994                18                    47                65

                         1995                16                    45                61
                         1996                18                    50                68
                         1997                17                    53                70
                         1998                14                    53                67
                         1999                14                    54                68

                         a.   Estimates based on MITI production data (natural alcohols)
                              minus estimated volume of C6 -C10 range.

                         b.   Estimates based on MITI production data (synthetic alcohols,
                              C9 and higher) minus estimated volume of C9 -C11 range.

                         c.     Totals may not equal the sums of the categories because of
                                rounding.

                         SOURCE:         CEH estimates.



Total Japanese production of detergent alcohols declined in 1994 because Kao stopped production of
detergent alcohols in its Wakayama plant and started importing natural alcohol from its joint ventures in
Malaysia and the Philippines. Consequently, Japanese domestic production of natural detergent alcohols
declined sharply that year. Since then, the production of natural alcohol was between 14 thousand and 18
thousand metric tons. On the other hand, the production of synthetic alcohol has been steadily increasing.
In 1998, the production of synthetic alcohol reached to 53 thousand metric tons. As a whole, the
production of detergent alcohol was relatively stable between 65 thousand and 70 thousand metric tons in
the past five years.

The share of detergent alcohol production accounted for by natural alcohols in any year previously
reflected the price of coconut oil versus that of petrochemical raw materials during that year. However,
other considerations have also become important. Some of the major Japanese detergent manufacturers
have joint ventures in Southeast Asian countries to produce oleochemicals, including natural fatty
alcohols, from the coconut and palm kernel oils produced in those countries. These vertically integrated

                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                   DETERGENT ALCOHOLS                                      Detergent Alcohols
609.5002 G                                                                                                    Page 59

detergent manufacturers prefer to use their own natural alcohols, rather than synthetic detergent alcohols,
for long-term strategic reasons. Thus, they are less likely to shift to synthetic sources, even if prices are
attractive. However, the purchases of smaller detergent manufacturers are still dictated largely by pricing.


CONSUMPTION

Japanese consumption of detergent alcohols increased at an average annual rate of 5.8% over the 1979-
1992 period, but declined in 1993. Between 1993-1999, consumption has remained between 115 thousand
and 124 thousand metric tons per year. Growth in consumption between 1998 and 2003 is expected to be
about 1.5% per year. The following table shows the Japanese consumption of natural detergent alcohols
and synthetic detergent alcohols since 1979:

                               Japanese Apparent Consumption of Detergent Alcoholsa
                                            (thousands of metric tons)
                                          Natural                Synthetic               Totalb

                       1979                  25                      35                    60

                       1980                  26                      30                    56
                       1981                  28                      26                    53
                       1982                  31                      35                    67
                       1983                  29                      42                    71
                       1984                  29                      50                    78

                       1985                  33                      47                    81
                       1986c                 47                      43                    90
                       1987c                 53                      45                    98
                       1988c                 60                      45                   104
                       1989c                 52                      59                   111

                       1990                  58                      53                   111
                       1991                  67                      54                   122
                       1992                  74                      52                   126
                       1993                  66                      49                   115
                       1994                  71                      49                   120

                       1995                  77                      47                   124
                       1996                  73                      47                   121
                       1997                  72                      51                   123
                       1998                  67                      49                   115
                       1999                  68                      50                   118

                       2003                  71                      53                   124

                       a.   Consumption equals production plus imports minus exports.

                       b.   Totals may not equal the sums of the categories because of rounding.

                       c.   Some imports are believed to be double-counted in reported
                            production. Adjustments have been made in the data in the table to
                            correct this error.

                       SOURCE:        CEH estimates.




                        © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                      DETERGENT ALCOHOLS                                 Detergent Alcohols
609.5002 H                                                                                                  Page 60

Derivatives of detergent alcohol are widely used for laundry and dishwashing detergents, other household
cleaners, shampoos and various industrial applications. Alcohol ethoxylate (AE) is the largest end use of
detergent alcohol and accounts for 55-60% of total detergent alcohol consumption. AE is used in various
applications, including heavy-duty and light-duty detergents as well as industrial applications. AE is also
used for production of alcohol ether sulfate (AES) that is mainly used for liquid detergents and shampoos.
The consumption of AE is expected to increase by replacing significant volumes of NPE that are used in
industrial applications. The replacement is expected to occur because the nonylphenol raw material for
making NPE may cause endocrine system problems.

Alcohol sulfate (AS) is mainly used for toothpaste, detergents and industrial applications. The
consumption of AS has been decreasing, as LAS has been replacing AS used in detergent applications
because of the former’s lower cost. The decline in the use of AS is expected to continue.

Other derivatives manufactured from detergent alcohol include a wide variety of products. Examples are
alkyl phosphate (MAP), alkyl polyglycosides (APG), lauryl acrylate, stearyl acrylate and amine
derivatives. Underivatized detergent alcohols (i.e., free alcohols) are mainly used as lubricants in many
industrial applications (e.g., for aluminum rolling oils). The free alcohols are also used as emollients in
cosmetics and pharmaceuticals.

The Japanese consumption by derivative type in 1992, 1995 and 1998 and the projected consumption for
2003 are outlined in the following table:

                               Japanese Consumption of Detergent Alcohols by Derivative
                                             (thousands of metric tons)
                                                                                          Average Annual
                                                                                           Growth Rate,
                                                                                            1998-2003
                                           1992     1995        1998         2003            (percent)

          Alcohol Ethoxylatesa               58      62           65           74              2.6
          Alcohol Sulfates                   42      34           21           18             –3.0
          Other Derivatives                  13      16           18           20              2.1
          Alcohols Used as Such              13      12           11           12              1.8

               Total                       126      124          115          124              1.5%

          a.     Includes AE used to make AES.

          SOURCE:         CEH estimates.



The consumption of detergent alcohols increased in the 1980s, following the removal of sodium
tripolyphosphate from Japanese laundry detergents, due mainly to environmental concerns. This trend has
had somewhat less impact on product performance than in the United States or Western Europe because
most areas in Japan have comparatively soft water. Nevertheless, most nonphosphate products do contain
slightly higher surfactant levels and more alcohol-based surfactants than the older phosphate-containing
products.

Growth in Japanese consumption of detergent alcohols during the 1991-1992 period reflected the
introduction of several detergents that contained high levels of alcohol-based surfactants. For example,
Lion introduced Natera ®, which contains narrow-range alcohol ethoxylates derived from natural fatty
alcohols. Kao’s laundry powder Just® is based on AE and contains no LAS. Furthermore, some detergent


                           © 2000 by the Chemical Economics Handbook—SRI International
May 2000                               DETERGENT ALCOHOLS                                Detergent Alcohols
609.5002 I                                                                                          Page 61

producers tried to promote laundry products based on natural alcohols as “good for the environment,”
because they are biodegradable and based on “natural” raw materials.

 In 1993, however, LAS replaced some of the alcohol-based surfactants in several detergents because of
cost considerations (i.e., LAS prices were far lower than the alcohol-based surfactants). This development
followed the introduction of private-label, heavy-duty, concentrated laundry powders by Japanese
supermarket chains. The prices of these products were much cheaper than those charged by other major
producers such as Kao, Lion and P&G. To compete, these detergent manufacturers shifted to the use of
the lower-cost LAS to reduce their production cost. Thus, the consumption of detergent alcohols declined
in 1993.

In 1995, Japanese consumption of detergent alcohols for AE and AES increased because of detergent
formulation changes that occurred that year. Consumption of AE has also been increasing in industrial
applications. In 1995, Kao introduced a heavy-duty laundry liquid version of its laundry powder Attack®.
This liquid product has obtained a significant market share in Japan. Consumption of heavy-duty laundry
liquids had declined significantly after the introduction of the first-generation concentrated laundry
detergents, but their sales have increased recently. Since they contain high levels of AE and other
detergent alcohol derivatives, the use of these liquid laundry detergents has increased the consumption of
alcohol-based surfactants. Several new, highly compact laundry powders have been introduced, some of
which use surfactants based on detergent alcohols. Although they contain high concentrations of these
surfactants, the volume required for each washload is smaller. Consequently, the actual volume of
surfactant delivered per washload is about the same. Most compact detergents contain 30-40% active
surfactant. In 1999, major high-concentration detergents were Compact Attack® from Kao, Super Top ®
from Lion and Ariel Pure Clean® from P&G. These three brands now account for over 70% of total
detergent sales in Japan.

With regard to dishwashing detergent, P&G entered the Japanese market with a new concentrated
dishwashing liquid, Joy ®, in 1995. It quickly gained a significant share of that market in early 1996. Kao,
Lion Corporation and some small producers introduced competitive concentrated products shortly
thereafter. As a result, the Japanese dishwashing liquid market has changed dramatically and more than
60% of the total market is now accounted for by concentrated types. The sales of dishwashing liquid
detergent fell to 210 thousand metric tons in 1998, which was 8% lower than in 1997. The sales decrease
was mainly due to the further penetration of compact dishwashing liquid into the market. Generally, these
products are sold in 300 milliliter plastic bottles and the total surfactant level is 37-48%. Most of these
new products are based on AES.


PRICE

The following table gives Japanese unit sales values for natural and petrochemical-based higher alcohols.
The data for synthetic alcohols include the C 9 -C11 range, and for natural alcohols they include the C8-C18
range.




                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                    DETERGENT ALCOHOLS                                            Detergent Alcohols
609.5002 J                                                                                                           Page 62

                              Japanese Unit Sales Values for Detergent-Range Alcohols
                              Yen per Kilogram               Dollars per Kilogram
                                                                                           Exchange Rate
                           Natural         Synthetic       Natural         Synthetic       (yen per dollar)

               1975           376              na            1.27              na                 297
               1976           356              na            1.20              na                 297
               1977           346             290            1.29             1.08                269
               1978           332             290            1.58             1.38                210
               1979           365             306            1.67             1.40                219

               1980           419             343            1.85             1.51                227
               1981           390             351            1.76             1.59                221
               1982           389             358            1.56             1.44                249
               1983           396             358            1.66             1.50                238
               1984           436             361            1.82             1.51                239

               1985           390             363            1.63             1.52                239
               1986           285             350            1.69             2.07                169
               1987           258             338            1.78             2.33                145
               1988           254             339            1.98             2.65                128
               1989           262             344            1.90             2.49                138

               1990           267             338            1.85             2.33                145
               1991           256             357            1.90             2.63                135
               1992           251             342            1.98             2.70                127
               1993           237             344            2.13             3.09                111
               1994           215             340            2.10             3.33                102

               1995           217             340            2.31             3.62                 94
               1996           221             346            2.03             3.18                109
               1997           229             350            1.89             2.90                121
               1998           231             350            1.77             2.67                131
               1999           223             naa            1.97              na                 113

               a.   In 1999, statistics for synthetic alcohol included both detergent alcohol and plasticizer
                    alcohol.

               SOURCES:       (A) Yearbook of Chemical Industries Statistics, Ministry of International
                                  Trade and Industry (data for YEN PER KILOGRAM).

                              (B) CEH estimates (data for DOLLARS PER KILOGRAM).

                              (C) International Financial Statistics, International Monetary Fund (data
                                  for EXCHANGE RATE).



The following table shows Japanese unit import prices (cif) for detergent alcohols. All imports from the
Philippines, Malaysia and Indonesia are natural alcohols. Imported alcohols from Italy are believed to be
synthetic detergent-range alcohols. During the late 1970s and the early 1980s, only very small quantities
of synthetic detergent alcohols were imported.




                        © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                        DETERGENT ALCOHOLS                                      Detergent Alcohols
609.5002 K                                                                                                         Page 63

                               Japanese Unit Import Values (cif basis) for Detergent Alcohols
                             Yen per Kilogram                        Dollars per Kilogram

                            Natural                                  Natural
                                                                                                   Exchange Rate
                  Crudea       Separatedb   Syntheticc    Crudea        Separatedb    Syntheticc   (yen per dollar)

       1988        192.8          168.3         155.2        1.50          1.31             1.21        128.2
       1989        151.7          189.0         151.0        1.10          1.37             1.09        138.0

       1990        147.2          160.9         146.8        1.02          1.11             1.01        144.8
       1991        147.7          158.6         151.5        1.10          1.18             1.13        134.5
       1992        166.9d         157.9         135.0        1.32d         1.25             1.07        126.7
       1993        141.6          124.1         125.8        1.27          1.12             1.13        111.2
       1994        131.8          117.5         141.0        1.29          1.15             1.38        102.3

       1995        144.9          131.4         158.7        1.54          1.40             1.69         94.1
       1996        162.5          140.4         159.6        1.49          1.29             1.47        108.8
       1997        171.0          152.0         190.0        1.41          1.26             1.57        121.0
       1998        160.4          152.7         203.0        1.23          1.17             1.55        130.9
       1999e       146.1          136.9         197.0        1.29          1.21             1.74        113.23

       a.     Average price of imports from the Philippines, Malaysia and Indonesia. Import code nos. are
              1519.30.000 for 1988-1991, 1519.20.000 for 1992-1995 and 3823.70.000 for 1996-1999.

       b.     Average price of imports from Philippines, Malaysia and Indonesia. Import code # is 2905.17.000 for
              1988-1999.

       c.     Average price of imports from Italy. Import code nos. are 1519.30.000 for 1988-1991, 1519.20.000 for
              1992-1995 and 3823.70.000 for 1996-1999.

       d.     The price of alcohols imported to Japan from Malaysia in 1992 was higher than that of imports from the
              Philippines. These higher-price imports caused the average price to increase significantly.

       e.     The average price for January-November 1999.

       SOURCE:         Japan Exports & Imports, Commodity by Country, Japan Tariff Association.



Japanese prices for detergent alcohol have not changed much during the past few years. In 1999, the
actual domestic price for mixed detergent alcohols was about ¥200-250 ($1.77-2.21) per kilogram and the
price of single-cut C12 alcohol was about ¥250-300 ($2.39-2.56) per kilogram (exchange rate of ¥113 per
dollar). Prices of natural alcohol tend to be higher than those of synthetic alcohol. This trend is expected
to continue for the next few years.




                             © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                    DETERGENT ALCOHOLS                             Detergent Alcohols
609.5002 L                                                                                            Page 64

TRADE

Japanese imports and exports of detergent alcohols are outlined in the following tables.

                                       Japanese Imports of Detergent Alcohols
                                             (thousands of metric tons)
                                          Naturala                  Synthetic    Total

                      1979                    1.8                          0.3     2.1

                      1980                   7.1                           0.2     7.3
                      1981                   7.6                           0.6     8.2
                      1982                   7.2                           0.5     7.7
                      1983                   6.1                           1.6     7.7
                      1984                  10.9                           1.5    12.4

                      1985                  10.3                           1.6    11.9
                      1986                  14.9                           1.7    16.6
                      1987                  15.4                           2.0    17.4
                      1988                  19.6                           4.4    24.0
                      1989                  13.7                          13.7    27.4

                      1990                  16.5                           9.2    25.7
                      1991                  24.1                           8.1    32.2
                      1992                  34.3                           6.5    40.8
                      1993                  33.0                           6.5    39.5
                      1994                  54.0                           4.3    58.3

                      1995                  61.1                           4.1    65.2
                      1996                  55.6                           4.4    60.0
                      1997                  55.5                           5.0    60.5
                      1998                  53.6                           2.2    55.8
                      1999                  54.2                           2.4    56.6

                      a.     C6 -C11 range is eliminated by estimation.

                      SOURCE:          CEH estimates based on Japan Exports & Imports,
                                       Commodity by Country, Japan Tariff Association.




                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                 DETERGENT ALCOHOLS                                   Detergent Alcohols
609.5002 M                                                                                               Page 65

                                     Japanese Exports of Detergent Alcohols
                                           (thousands of metric tons)
                                         Natural              Synthetica             Total

                       1979                neg                    6.0                 6.0

                       1980                neg                    3.0                 3.0
                       1981                neg                    4.1                 4.1
                       1982                neg                    4.3                 4.3
                       1983                neg                    3.7                 3.7
                       1984                neg                    2.4                 2.4

                       1985                neg                    2.2                 2.2
                       1986                neg                    2.8                 2.8
                       1987                neg                    2.6                 2.6
                       1988                0.3                    2.2                 2.5
                       1989                0.5                    1.4                 1.9

                       1990                0.6                    2.8                 3.4
                       1991                0.6                    1.8                 2.4
                       1992                0.4                    2.2                 2.6
                       1993                0.3                    2.1                 2.4
                       1994                0.7                    1.9                 2.6

                       1995                0.2                    2.1                 2.3
                       1996                0.3                    7.5                 7.8
                       1997                0.5                    6.9                 7.4
                       1998                0.5                    7.0                 7.5
                       1999                0.5                    6.4                 6.9

                       a.   Includes the alcohol content of secondary AE produced by Nippon
                            Shokubai.

                       SOURCE:       CEH estimates based on Japan Exports & Imports,
                                     Commodity by Country, Japan Tariff Association.



Japanese imports of natural detergent alcohols increased in 1994 and 1995 because Kao and New Japan
Chemical shifted their main production sites to Malaysia and the Philippines. As shown in OTHER
REGIONS, these companies have subsidiaries and/or joint ventures in Malaysia and the Philippines.


OTHER REGIONS

Outside the United States, Western Europe, Japan and the former Communist countries, there are no
synthetic detergent alcohol plants. There are four natural alcohol plants in the Philippines, three plants in
Malaysia, three in India and two in Indonesia


CHINA

Information on detergent alcohols in China can be obtained from SRI Consulting’s China Report:
Chemical Product Trends.




                        © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                        DETERGENT ALCOHOLS                                       Detergent Alcohols
609.5002 N                                                                                                          Page 66

INDIA

A list of detergent alcohol plants in India is provided in the following table:

                                            Indian Producers of Detergent Alcohols
                                               Annual Capacity
                                                    as of
                                               December 1999
                   Company and                  (thousands of
                   Plant Location                metric tons)           Raw Material               Remarks

         Aegis Chemical Industries Ltd.
           Jalqaon, Maharashtra                        5                 Fatty acids

         Atul Ltd.
           na                                          3                 Fatty acids

         Gujarat Godrej Innovative
         Chemicals Ltd.
           Valia, Gujarat                             30                 Fatty acids      The plant came on stream in
                                                                                          1993.

                Total                                 38

         SOURCE:        CEH estimates.



INDONESIA

Since 1994, there have been two fatty alcohol plants in Indonesia with a total annual capacity of 90
thousand metric tons, as shown in the following table:

                                          Indonesian Producers of Detergent Alcohols
                                    Annual Capacity
                                         as of
                                    December 1999
        Company and                  (thousands of
        Plant Location                metric tons)           Raw Material                        Remarks

   Prima Inti Perkasa P.T.
     Belawan, North Sumatra               30               Palm kernel oil;       Former Aribhawana Utama PT, which
                                                           coconut oil            changed to Prima Inti Perkasa in 1998.
                                                                                  Production began in 1990.

   Batamas Megah PT
   (Salim Group)
     Kabil, Riau                          60               Palm kernel oil;       The plant was on stream in February 1994
                                                           coconut oil            and started commercial production in
                                                                                  August 1994.

        Total                             90

   SOURCE:         CEH estimates.




                            © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                     DETERGENT ALCOHOLS                                      Detergent Alcohols
609.5002 O                                                                                                      Page 67

The capacity shown in the table includes alcohols below C12 . The capacity for detergent alcohol is
estimated as 90% of the total capacity, i.e., about 80 thousand metric tons. Aribhawana Utama PT
changed its name to Prima Inti Perkasa P.T. in 1998.

There are no published statistical data for Indonesian production of fatty alcohols, but production has
been increasing since it began in 1990. Indonesian consumption of fatty alcohols is still limited, but it has
been increasing and is expected to increase further in the next five years. The following table shows
Indonesian exports of fatty alcohols during 1991-1998:

                                         Indonesian Exports of Fatty Alcohols
                                              (thousands of metric tons)
                                                                           Other Saturated
                         Industrial Fatty        Lauryl, Cetyl and          Monohydric
                            Alcoholsa            Stearyl Alcoholsb            Alcoholsc           Total

                1991          12.2                        --                     5.7               17.9
                1992          17.3                        1.3                    5.4               23.9
                1993          10.8                        3.2                    neg               14.1
                1994          17.5                        5.4                    neg               22.9
                1995           2.8                       14.3                    0.8               17.8
                1996          55.9                       14.1                    1.6               71.6
                1997         106.5d                       9.1                    0.8              116.4
                1998          57.3                       11.8                    2.7               71.8

                a.   Export nos. 1519.30000 for 1991-1995 and 3823.70.000 for 1996-1998.

                b    Export # 2905.170000.

                c.   Export # 2905.190000.

                d.   Overstated. Actual exports were probably about 50-60 thousand metric tons.

                SOURCE:       Indonesia foreign trade statistics.



Although Batamas Megah PT started up its plant in 1994, start-up problems limited production until
1996. After that time, exports of industrial fatty alcohols increased to about 55 thousand metric tons. The
export of industrial fatty alcohols shown in the export table for 1997 is overstated. Actual exports of fatty
alcohol in 1997 were probably about 50-60 thousand metric tons. In 1998, Indonesian exports of mixed
industrial fatty alcohols went mainly to the United States (38%) and the Netherlands (23%). Separated
fatty alcohol (e.g., lauryl, cetyl and stearyl) exports went mainly to Japan (21%), China (17%), Germany
(16%), the United Sates (12%) and the Netherlands (11%).


MALAYSIA

Malaysia has 220 thousand metric tons per year of natural alcohol capacity and is one of the largest
suppliers of natural fatty alcohols in the world. Excluding alcohols below C 12, the capacity for detergent
alcohols is estimated to be about 200 thousand metric tons. The following table shows the Malaysian
producers of fatty alcohols:




                         © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                         DETERGENT ALCOHOLS                                      Detergent Alcohols
609.5002 P                                                                                                          Page 68


                                          Malaysian Producers of Detergent Alcohols
                                   Annual Capacity
                                        as of
                                   December 1999
     Company and                    (thousands of
     Plant Location                  metric tons)              Raw Material                           Remarks

Cognis Rika (M) Sdn. Bhd.
  Telok Panglima Garang,                    30                Palm kernel oil          Former Henkel Rika. A joint venture
   Selangor                                                   (via methyl esters)      (55:25:20) of Cognis (Malaysia) Sdn.
                                                                                       Bhd., New Japan Chemical Co., Ltd. and
                                                                                       LG Chemical Ltd. (Republic of Korea).

Fatty Chemical (Malaysia)
Sdn. Bhd.
  Prai, Penang                             110                Palm kernel oil          The plant was expanded to 85 thousand
                                                              (via methyl esters)      metric tons at the end of 1993; joint
                                                                                       venture (70:30) of Kao Corporation
                                                                                       (Japan) and Palmco Holdings Bhd.

FPG Oleochemicals Sdn.
Bhd.
  Kuantan, Pahang                           80                Palm kernel oil          The plant was on stream in mid-1993;
                                                              (via methyl esters)      joint venture (50:50) of The Procter &
                                                                                       Gamble Company (United States) and
                                                                                       Felda Palm Industries Sdn. Bhd.

    Total                                  220

SOURCE:      CEH estimates.



Fatty Chemical (Malaysia) Sdn. Bhd. gradually increased its capacity to 110 thousand metric tons by
debottlenecking in 1999. FPG Oleochemicals Sdn. Bhd. also increased its capacity, from 65 thousand
metric tons to 80 thousand metric tons in 1998.

There are no statistics on the production of fatty alcohols in Malaysia, but production has been increasing
during the past five years. It is estimated that the plant utilization rate was about 90% in 1998. Domestic
consumption of fatty alcohols is limited and most of the production is exported to other countries.

The following table shows Malaysian exports of fatty alcohols for 1990-1996:

                                        Malaysian Exports of Fatty Alcohols—1990-1996
                                                  (thousands of metric tons)
                            Industrial Fatty     Industrial     Lauryl, Cetyl       Other Saturated
                             Alcohols in the       Fatty        and Stearyl          Monohydric
                             Form of Waxa        Alcoholsb       Alcoholsc             Alcoholsd       Total

                1990               0                 8.8              5.9                 1.7           16.3
                1991              neg               10.9             15.7                 1.7           28.4
                1992               0                20.9             20.2                 4.0           45.1
                1993              neg               42.2             21.2                 3.4           66.7
                1994              0.5               47.9             40.3                 6.2           94.9
                1995              0.2               86.9             44.1                 6.6          137.8
                1996              0.1               31.4             43.7                 3.2           78.4



                             © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                       DETERGENT ALCOHOLS                                         Detergent Alcohols
609.5002 Q                                                                                                           Page 69


                a.   Export nos. 1519.20-100 for 1990-1995 and 3823.70-100 for 1996.

                b.   Export nos. 1519.20-900 for 1990-1995 and 3823.70-900 for 1996.

                c.   Export # 2905.17-000.

                d.   Export # 2905.19-000.

                SOURCE:         Malaysia External Trade Statistics, Department of Statistics, Malaysia.



Malaysian exports of fatty alcohols have increased significantly. Major destinations are Japan, the United
States and Western Europe. All of the Malaysian operations are joint ventures of Malaysian investment
groups and major international detergent and personal care product manufacturers. The latter companies
have been purchasing detergent alcohols from these joint ventures.

In 1996, crude fatty alcohols (i.e., industrial fatty alcohols) were exported mainly to the United States
(22%), Japan (19%), Singapore (12%) and Germany (10%). Separated fatty alcohols (e.g., lauryl, stearyl
and cetyl alcohols) were exported mainly to Japan (47%), the Philippines (20%) and Germany (7%). The
exports to the Philippines were probably sent by Kao’s Malaysian joint venture to Pilipinas Kao, Inc. for
producing high-purity fatty amines.


PHILIPPINES

The following table shows Philippine producers of fatty alcohols, their plant locations, production
capacity, raw materials and processes. The capacity for detergent alcohols is estimated at 90% of the total
capacity.

                                         Philippine Producers of Detergent Alcohols
                                          Annual Capacity
                                               as of
                                          December 1999
                                           (thousands of
 Company and Plant Location                 metric tons)              Raw Material                        Process

Colgate-Palmolive Philippines Inc.
  Lucena, Quezon                                   3.6            Coconut oil                Catalytic hydrogenation.

Pilipinas Kao, Inc.
   Cagayan de Oro, Misamis Oriental              30.0             Coconut oil                Catalytic hydrogenation.

Primo Oleo-Chemicals Inc.
  Bical, Luzon                                    30.0            Coconut oil                Catalytic hydrogenation (low pres-
                                                                                             sure process). The plant was
                                                                                             completed in 1998. However, it
                                                                                             has not operated commercially.

United Coconut Chemicals Inc.
  Bauan, Batangas                                30.0             Coconut fatty acids;       Catalytic hydrogenation (Lurgi
                                                                  methyl esters              process).

    Total                                        93.6

SOURCE:       CEH estimates.


                            © 2000 by the Chemical Economics Handbook—SRI International
May 2000                                 DETERGENT ALCOHOLS                                    Detergent Alcohols
609.5002 R                                                                                                Page 70

Although a plant of Primo Oleo-Chemicals Inc. was completed in 1998, it has not been commercially
operated because of various problems. This plant is in the southern part of Luzon Island and is a part of a
complex that also includes a fatty acid plant (20 thousand metric tons) and a glycerin plant (5 thousand
metric tons). The alcohol plant will use the Davy-McKee process, in which catalytic hydrogenation is
performed at lower pressures (40-50 atm). By using this process, plant construction costs can reportedly
be reduced, but only C12-C14 range alcohols will be produced.

No statistics are reported for the production of fatty alcohols in the Philippines. However, production of
fatty alcohols had been increasing until recently because of increasing domestic consumption.
Consumption of fatty alcohols in the Philippines has benefited from a law requiring that 60% of the
surfactants used in detergents sold there must be based on coconut oil.

The following table shows reported exports of fatty alcohols from the Philippines:

                                       Philippine Exports of Fatty Alcohols
                                            (thousands of metric tons)
                                     Industrial           Lauryl, Cetyl and
                                   Fatty Alcoholsa        Stearyl Alcoholsb          Totalc

                         1989            42.2                     --                 42.2
                         1990            36.6                     --                 36.6
                         1991            28.0                     0.5                28.5
                         1992            23.3                     0.4                23.6
                         1993            21.9                     0.4                22.4
                         1994            20.6                     0.1                20.7
                         1995            21.1                     0.1                21.2
                         1996            13.6                     5.6                19.2
                         1997            11.7                    14.8                26.5

                         a.   Export # 512.17-000.

                         b.   Export # 512.19-000.

                         c.   Totals may not equal the sums of the categories because of
                              rounding.

                         SOURCE:       Foreign Trade Statistics of the Philippines, National
                                       Statistics Office.



In 1997, Philippines exports of industrial fatty alcohols went mainly to the United States (20%), the
Netherlands (18%), Republic of Korea (11%) and Taiwan (11%). Lauryl, cetyl and stearyl exports went
mainly to Japan (51%), Republic of Korea (23%) and Taiwan (8%).




                       © 2000 by the Chemical Economics Handbook—SRI International
May 2000                               DETERGENT ALCOHOLS                              Detergent Alcohols
609.5002 S                                                                                        Page 71

                                            BIBLIOGRAPHY

Chemical Economics Handbook—The following CEH marketing research reports contain additional
information that is pertinent to the subject of this marketing research report:

    Ethylene
    Ethylene Oxide
    Fats and Oils Industry Overview
    Linear Alkylate Sulfonates
    Linear alpha-Olefins
    Normal Paraffins (C9 -C17)
    Oxo Chemicals
    Surfactants, Household Detergents and Their Raw Materials

Process Economics Program—The following Process Economics Program reports contain more detailed
information on the manufacturing processes, process design and process economics of the chemicals
discussed in this report. Address inquiries concerning this information to the Process Economics Program,
SRI Consulting, Menlo Park, California 94025.

    Aliphatic Surfactants, Report Nos. 59 and 59A, December 1969 and March 1974.
    Anionic Surfactants, Report 59B, September 1992.
    Fatty Acids, Report Nos. 42 and 42A1, October 1968 and February 1975.
    Linear C12-C15 Primary Alcohols, Report No. 163, December 1983.
    Linear Higher Alcohols, Report No. 27, August 1967.
    Linear alpha-Olefins, Report Nos. 12, 12A, 12B1 and 12C, June 1966, October 1971, October 1974
      and July 1990.
    Nonionic Surfactants, Report No. 168, March 1984.
    Oxo Alcohols , Report Nos. 21, 21A 21B, 21C and 21D November 1966, November 1971, May 1978,
      April 1986 and December 1999.

Specialty Chemicals Update Program—The following SCUP reports contain worldwide business and
end-use market information related to this report. Address inquiries regarding this information to the
Specialty Chemicals Update Program, SRI Consulting, Menlo Park, California 94025.

    Industrial and Institutional Cleaners
    Lubricating Oil Additives
    Surfactants

Other References—The following list of references is suggested for supplemental reading:

Fatty Alcohols—Raw Materials, Methods, Uses, Henkel KGaA, Düsseldorf, Germany, 1982.

Monick, J. A., “Fatty Alcohols,” Journal of the American Oil Chemists’ Society, November 1979,
  pp. 853A-860A.

Schulz, P., “Chemistry and Technology of Alkyl Glycosides,” Chimicaoggi, August/September 1992, p.
   33.




                       © 2000 by the Chemical Economics Handbook—SRI International

				
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Description: Detergent alcohols are those containing twelve or more carbon atoms in chains that are at least 35% linear. The following table summarizes the number of producers, capacities, production, consumption and net imports of detergent alcohols for the three major producing areas of the world in 1998. Where possible, data for each region are subdivided into those for synthetic alcohols (i.e., derived from petrochemical sources) and those for natural alcohols (i.e., derived from fats and oils).