The rise and fall of surfactants lore
By Michael F. Cox
The rise and fall of surfactants lore Editor's note: The following article is based on the address given by Michael F. Cox, the 2009 Samuel Rosen Memorial Award winner, at the 100th AOCS Annual Meeting & Expo, held in Orlando, Florida, USA, May 3-6.
Significant changes have occurred in the surfacThe rise and fall of surfactants lore tants industry in the past 30 years, both in terms of what we consider to be important and in the paradigms that we operate under. The following discussion highlights my view of the significant changes that have occurred and is based entirely on my experience, recollection, and opinion.
Since I do not have a lot of space, I am going to focus on two key topics: surfactants as a business and paradigms in the surfactants industry.
SURFACTANTS AS A BUSINESS
You might ask yourself why an old research and development guy would delve into the business side of surfactants. The answer is that technical development and business development are (or should be) symbiotic; both aim to achieve the vision for the business. To a young scientist, it may seem more like the meeting of the Titanic (his or her technical project) and an iceberg (the business), but this should not often be the case when business and technical efforts are aligned. During the past 30 years, the surfactant business, and therefore the technical focus, has changed significantly. The two most significant changes that have occurred deal with who the key players are and who has had the greatest influence over the industry (in other words, who has been the "800-pound gorilla" in the surfactants playpen).
In the 1980s, surfactants were considered a great way to extend the oil business "downstream" to capture the rich returns that downstream derivatives could provide. This more or less began to reverse itself in the late 1980s as oil vs. derivative margins changed and oil companies concluded that they needed to focus on their core business of producing crude oil derivatives. This resulted in surfactants-based assets being sold off and in a reduction of new assets being built. Although I worked for the same company for 26+ years, my résumé looks as if I jumped ship on a regular basis. I started with Conoco in its chemicals division in 1981; Conoco was then purchased by DuPont, which sold the Conoco Chemicals division to form Vista Chemical Co., which later went public and was then purchased by RWE, who combined it with other purchased assets to form CONDEA, which was later sold to Sasol. This is the reason the governing board of the Surfactants & Detergents Division of AOCS has put considerable effort into developing a company name/asset roadmap, so that our younger scientists can better understand the history of our industry.
As those with experience will tell you, there is usually some entity in the industry that has significant influence over the industry at any given time. I refer to this entity as the "800-pound gorilla in the surfactants playpen." In the early 1980s, the well-integrated, large-volume surfactant producers had significant power (they were well positioned in that supply was tight and margins were good).
A good illustration of this is the 1985 AOCS meeting in Philadelphia. A surfactant manufacturer had organized a session focusing on a new surfactant it was promoting and had invited a number of companies evaluating the new surfactant to give presentations at the AOCS meeting on their experience with it. One of these companies informed the session chair (an employee of the surfactant manufacturer) that the data were not positive but they felt obligated to share the data and experience with the industry rather than cancel their presentation. My recollection is that just prior to the session, the session chair reorganized the session so that the offending paper was given last (at the end of the day). Furthermore, the session chair gave both an introduction and a rebuttal to the offending paper, something I have never seen occur since. My point is not to point fingers here (both companies involved felt they were doing the right thing) but to illustrate that during this period of time, the large surfactant manufacturers had clout, and clearly were 800-pound gorillas.
In the 1990s, the big gorilla was Wal-Mart, because of the sheer volume of product it moved through its plethora of stores. Wal-Mart's buying power had significant influence on pricing (as well as packaging, etc.), which initiated and/or exacerbated the pressure that the industry faced in the late 1990s and early 2000s to reduce costs and improve production efficiency.
In the 2000s, we saw a change in terms of what gave the gorilla its power. In the 1980s and 1990s, I think the ability to impact supply and demand (margin and sales) gave the gorilla its power, but in the 2000s, knowledge took over. Detergent manufacturers learned how to manage the gorillas of the 1980s and 1990s, and those that understood and planned for unexpected variations in supply became the 800-pound gorilla in the 2000s. If we have learned anything in the last decade, our ability to predict feedstock costs (and resultant surfactants costs) is comparable to our ability to predict the stock market. Detergent manufacturers that understood what could happen, and prepared for it, were logically better positioned to thrive in the market. As a technical person, I am gratified that power in our industry now comes from knowledge.
Although I think the gorilla of the 2000s (knowledge) will thrive in the next decade, I think we will also see the emergence of another gorilla from the surfactant manufacturers' side. Enhanced oil recovery (EOR) is becoming a reality, and the volume of surfactant that will be consumed in this market is significant (comparable, potentially, to the detergents market). You can argue that EOR has been talked about for decades and that oil prices have come back down, but the bottom line is that nobody thinks that, in the long-term, the price of oil is going anywhere but up. In addition, EOR technology has become more effective and technically driven, making EOR less speculative in nature. It is my opinion that surfactant manufacturers that align themselves to service this emerging market, while staying a force in the detergents market, will take on "gorilla" stature.
PARADIGMS THAT HAVE BEEN SHATTERED
Paradigms shape our industry, and an examination of how paradigms have changed over time gives us an idea of where we are and where we are headed. When I started in the surfactants industry in 1981, I was taught that linearity and acceptability went hand-in-hand, and that surfactants with nonlinear hydrocarbon backbones were inferior. Shell put the first serious crack in this paradigm by successfully teaching the industry that alcohol and alcohol derivatives with some methyl-branching (and with both even and odd carbon-number chain lengths) were not only acceptable but performed more or less identically to their oleochemical or Ziegler-based counterparts. This paradigm was more completely shattered by Procter & Gamble's research and development of selectively branched surfactants, which basically demonstrated to the industry that limited branching can provide enhanced surfactant properties without negatively impacting environmental acceptability.
When I started as a surfactants chemist, the fundamental understanding of surfactants was left to the academicians. Industry scientists focused on the application of surfactants and not on basic surfactant properties. AOCS meetings had "academic" sessions and they had "industrial" sessions. I am glad to say that I think this segregation has largely been eliminated. Although academia still orients itself toward fundamentals and the commercial industry toward applications, they share a common appreciation that both orientations require an understanding of the other. I think we have academia to thank for this. Professors Milton Rosen, John Scamehorn, and others have worked hard to make sure their research had practical utility to the industry, and they have effectively educated the industry on the importance of understanding the fundamental chemistry of surfactants. This is why we now have technical sessions where both academicians and industrial chemists participate, both in the seats and at the podium. Another good example of this blending of academia and industry is illustrated by the Samuel Rosen Memorial Award: this award is sponsored by Professor Milton Rosen of the City University of New York (USA), an academician, for significant accomplishments in the application of the principles of surfactant chemistry in industry. Thank you, Dr. Rosen.
The last paradigm that I think has been firmly shattered is this: feedstock consumption, availability, and costs (and the stock market) can be reliably predicted!
THE PARADIGM THAT JUST WILL NOT GO AWAY
One way of thinking that I wish would just go away is the "my product is greener than yours" mentality. If we have learned anything in the last 30 years, it is that making unsubstantiated environmental claims so as to market products only results in the industry having to put tons of money into unneeded product defense instead of into research that moves the industry forward. For example, the word "green" is often inappropriately used and is seldom adequately defined in our industry, which unfortunately means that it will eventually be discarded (except by fashion designers and landscapers) and replaced by a new word that some in the industry can then spin-doctor into oblivion. Meeting acceptable human health and environmental standards is the responsibility of the industry as a whole. The giants in our industry understand this. I think it is the smaller "want-to-be giants" that sometimes use their limited understanding of an issue (for example, 1,4-dioxane in ethoxylates) as an opportunity to market their products; this only causes confusion and hinders efforts being made in the industry through organizations such as The Soap and Detergent Association to apply good science and reason to real issues. The bottom line is this: Knowledge, good science, and common sense are critical when dealing with these issues. If you do have these tools, please do not pick a fight in order to advance your agenda.
PARADIGM OF THE FUTURE?
I believe that success in the surfactants industry in the next decade will require two things: knowledge and flexibility. Feedstock availability and costs will continue to vary (perhaps unpredictably) and the influence of EOR will begin to impact surfactant availability. Although the parent hydrocarbons used to make surfactants for EOR are largely different from those used to make surfactants for the detergents industry, harvesting new hydrocarbon feedstocks from existing sources, and the need to convert these new feedstocks to surfactants using conventional derivatization technologies (sulfonation, ethoxylation, etc.), will certainly impact surfactants' supply and demand to the detergents industry. Surfactant manufacturers that understand this, and align themselves to take advantage of this, will be more successful than those that do not. Detergent producers that understand this, and prepare for this, will be more successful than those that do not.
I want to thank Milton Rosen for sponsoring the Samuel Rosen Memorial Award, the selection committee, and AOCS for the honor of receiving this year's Rosen Award, and for the opportunity to present my thoughts on "The Rise and Fall of Surfactants Lore."
Michael F. Cox retired after 26+ years in the surfactants industry and is now a consultant based in Georgetown, Texas, USA. He can be reached at MichaelFCox@suddenlink.net.