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Emulsion Industry: Key Trends, Drivers & Challenges - Part 1

Dr. Alexander Madl – Mar 23, 2018

Trends Driving Emulsion IndustryAll industries are getting influenced by the global megatrends, emulsion industry is no different. Thus, it would be interesting to investigate these general trends.

Want to understand how these trends are impacting the emulsions industry?

Explore what challenges and opportunities can be derived from the general global megatrends for the emulsion Industry. And, find how an effective reaction on these external impulses could help develop potential strategies for sustainable, low emission, green polymer emulsions.

Let's begin with the leading trends shaping the emulsion Industry...

Identifying the Leading Trends Impacting Emulsions Industry

Amongst the megatrends that shape our present and ignite the change for future developments, there are a few that specifically impact the emulsions industry.

Trend #1

The first trend is the undeniable shift of the epicenter of economic growth and political influence towards Asia. The economic success of the already progressed Asian nations and their impact as a role model for the now emerging ones led (or will lead) to a new, rising middle class, with increasing needs for high-quality consumption.

This need is for instance expressed in a booming housing and construction industry. There are many differentiated applications, from the construction materials for a foundation, over insulation, sealants up to decorative paints and trendy furniture. Emulsion polymers can and does serve for all these applications.

Trends Impacting Emulsion Industry

Trend #2

Here, the new middle class starts to care more about health and environment issues. Therefore the consumption patterns become more "green". The new consumers now take up needs, e.g. for low emission applications in the housing industry, that was first developed in “Western” societies in the 1970s, but were not accessible for the majority of the world’s population until now.

The emulsions industry’s promise of high durability and functionality provided by waterborne polymer binders formulated without additional solvents fulfills exactly this new customer need.

As these are trends are for emerging regions and based on the prognosis of a rising middle class; there is still a huge potential. For instance, a significant part of all globally used Paints and Coatings is still solvent-borne. Or, less than 50% of all dry mortars are polymer modified on a global base, compared to almost 100% in Central Europe.

Besides these two leading trends, emulsions industry is influenced more by the chemical industry. The specific ones include a change in raw material base towards more sustainable ones, increasing regulation, and finance investor driven restructuring of the whole industry.

Overview Emulsions Polymers

The polymer emulsion industry is very versatile. Polymer emulsions can be formed from different classes of raw materials and serve manifold, diverse applications, such as:

 − Architectural Coatings
 − Industrial Coatings
 − Paper Coatings
 − Packaging Adhesives
 − Adhesives for Tapes and Labels, or
 − Carpet Backing Adhesives, amongst many others

With these applications, emulsion polymers are used in diverse sectors, such as:

 − Housing and construction industry
 − Decoration or protective coatings
 − Packaging industry
 − Non-woven textiles
 − Food coating, or
 − Printing inks

Polymer Emulsions Demand by Application
Global Share Volume Based on Application, as Forecasted for 2021 by The Freedonia Group

Formulating Polymer Emulsion

Polymer emulsions are formed by free radical polymerization of monomers emulsified into water. This results in a dispersion of solid polymer particles in the aqueous matrix. For many applications, this dispersion is ready to use without further, expensive separation and cleaning steps. Although, in some cases; the polymer emulsion is spray dried to form a re-dispersible polymer powder (RDP).

A fast amount of both bulk and functional monomers can be used in emulsion polymerization to tailor the application properties. In addition, specific chemicals are used to aid the process and to impact the performance of the polymer emulsion. The most prominent of these chemicals are surfactants or polymeric stabilizers. But, the choice of initiator, buffer system and even the process conditions are also crucial for the final application properties.

Classification of Polymer Emulsions

Polymer emulsions are typically classified based on their main co-monomers, such as:

 − Acrylics
 − Vinyl acetate based, and
 − Styrene-Butadiene

Besides them, there are many special, lower volume polymer emulsions types.

Polymer Emulsion Demand by Monomer Base
Global Share Volume Based on Monomer Base, as Forecasted for 2021 by The Freedonia Group

Acrylic Based Polymer Emulsion

The class of Acrylic-based polymer emulsions is the biggest in volume and value. Also, it is the most versatile in terms of polymer property range. There are many monomers commercially available as esters of Acrylic- or Meth-acrylic acid, ranging from low to high Tg as well as from hydrophilic to hydrophobic. They also can bear manifold functionalities. Acrylic based monomers can be copolymerized with Styrene or Vinyl acetate, forming Styrene-acrylics and Vinyl acrylics as sub-classes, respectively.

Vinyl Acetate Based Polymer Emulsions

Vinyl acetate based polymer emulsions are somewhat limited in choice of copolymers compared to acrylics based copolymers. They are often supplied as pure Vinyl acetate polymer emulsions, sometimes with some functionalization in low percent region.

Vinyl versatate (VeoVa10™) and in special cases, Vinyl chloride function as main co-polymers for Vinyl acetate based emulsions.

From these sub-segments, Ethylene-Vinyl acetate polymer emulsions (VAE) form one of the fastest growing sub-segments in whole emulsion industry.

Styrene-Butadiene Emulsions

Styrene-Butadiene is the least versatile segment in terms of copolymer composition. It is mainly differentiated whether carboxylated or not. About 60% of the total volume is delivered into the Paper Coatings application, which accounts together with Carpet Backing Adhesive applications for in total three-quarters of the whole volume produced. In reverse, Styrene-Butadiene accounts for 70% of the polymer emulsions used in Paper Coatings and for more than 90% used in Carpet Backing Adhesives. In this respect, this class of polymer emulsions stands out from the general observed high diversity and versatility.

The table below shows a list of typical monomers to synthesize polymer emulsions, with key physical data

Monomer Boiling point / °C Tg / °C ΔpolyH / MJ kg-1
Ethylene - 103 - 100 - 3.42
1,3-Butadiene - 4.5 - 85 - 1.28
n-Butyl acrylate 148 - 54 - 0.60
Ethylhexyl acrylate 214 - 50 - 0.33
VeoVa10TM 270 - 280 - 3 - 0.48
Vinyl acetate 73 28 - 1.02
Vinyl chloride - 13.4 85 - 1.69
Styrene 145 100 - 0.65
Acrylic Acid 105 105 - 1.08
MMA 101 105 - 120 - 0.58

Now, let's understand what drives the emulsion industry:

Key Driver 1: Undampered Growth, with the Focus Shift to China & Asia-Pacific

Polymer emulsions are amongst the fastest growing categories of specialty chemicals in the world. The annual growth rate is projected with 4- 6% to reach a volume of about 14-18 million metric tons, worth about 35-45 billion US$ in revenue end of 20201.

Leading Regions of Polymer Industry Based on its general economic growth, Asia Pacific became the leading region for polymer emulsion market over the past decade or so. This is due to the rapid growth of end-user industries, such as: Paint and Coatings, Buildings & Construction and Adhesives in the region. China alone will soon account for over one-fourth of global sales in polymer emulsions and will continue to shape global demand trends.

All segments and applications grow, but mainly Acrylics and VAE sub-segment of Vinyl acetate based polymer emulsions serving the general Housing and Construction sector as well as the Paint and Coatings industry outpace the other categories.

Emulsion polymers are also growing above GDP in the mature markets of (Western) Europe and (North) America. But, with an aging population and in general comparatively lower growth rates, this doesn’t take away the focus from Asia. Consequently, all major suppliers are present in the region and invested both in new emulsion production capacity and local research centers. Some of them are- or will soon be- serious contenders of the established players. It can be expected that even more innovation will come from Asia.

Also, new trends will be set there and then adapted into the global emulsions world. There is no doubt, the 21st-century focus on polymer emulsion industry shifted east.

Key Driver 2: New Emerging Regions

Whilst China and Asia-Pacific established itself as new focus region for emulsion industry, India will provide the fastest growth rate of any country. Originally developed as markets in Western Europe and North America, it made its first major footsteps in Asia in Japan and then in China, and now spreading over the whole Asia-Pacific region. From there it is growing in India, and there are already new seeds coming to Near East Region, which is approached from both East and West now.

At this moment, there are interesting developments happening in Near East region, e.g. with the announcement of Saudi-Arabic government to invest in downstream chemistry and the establishment of a larger emulsion polymers complex in UAE2.

Dampened by still unfavorable economic conditions, Russia, parts of East Europe, and Latin America still stay behind their potential for polymer emulsions application and growth. As soon the economic conditions change there, allowing a middle class to thrive, emulsions industry will harvest also in these regions.

Key Drivers 3: Regulation

Regulations on Emulsion Industry The trend towards higher environmental awareness and a need for sustainability drives the chemical industry towards higher regulation. Regulation comes not only from official governmental or even supra-governmental side (e.g. REACH in European Union), but also from consumer initiatives.

Additionally, industry ties or high impact players can “regulate” the raw material base of emulsion industry. As an example for the latter case, there are global acting formulators or consumer solution providers who set their own, often higher than official, standards to manage environmental or health issues for their customer base.

The emulsions industry, with its diverse raw materials footprint on the one side and target markets aiming for green (e.g. in construction) or non-toxic (e.g. food packaging) application, is especially prone to regulation.

Driving Towards APEO Free version

Alkylphenol ethoxylate (APEO) derivate-based surfactants were one of the most widely used types of stabilizers in emulsion industry. They now are almost completely erased from the emulsions raw material base in major regions. And there will be increasing pressure in the future to eliminate them in the residual recipes. Quite some effort went into the development of emulsion polymers that provide similar performance in the final applications with the APEO free versions.

Especially for Europe, on the tail end of the raw material base for emulsion industry, REACH will impact on the variability of available specific surfactants and auxiliaries. So on one end, increasingly diverse regional markets and customer needs drive for diversification in the raw material base for emulsion polymers, while regulation drives the variety of choice down.

Limitations on Formaldehyde

Another big issue for regulation is Formaldehyde. Formaldehyde is released from components used in emulsion polymerization, such as initiator system, biocides or specific cross-linkers. Formaldehyde is labeled as carcinogenic or suspected to be so in many regions of the globe. The use of Formaldehyde releasing components was limited over the past in many applications and it will be under increasing pressure for further elimination.

The main monomers used in emulsion polymerization itself bear some potential for regulation. As these monomers are transformed into polymers they lose their hazardous potential over the course of polymerization. Hence, increasing regulation targets the residual monomers left in the ready to use emulsion.

This drives the emulsion producers to take additional steps for removing them, adding to investment and operations cost

There is a sort of contradiction as quite toxic monomers are transformed into a product that is designed to serve green, sustainable applications. Even when risks can be managed technically, both customer perception and governmental regulation might drive the emulsions industry towards narrowing down its potential raw material base.

The trends and drivers impacting the emulsions industry must be seen as neutral forces.
Every challenge also bears an opportunity. Every threat also can drive towards
an innovative solution allowing for further diversification from competition

 » Continue reading to explore the key challenges that impact the emulsion industry in the present and how these challenges could drive the future opportunities.

1 Comments on "Emulsion Industry: Key Trends, Drivers & Challenges - Part 1"
Marga A Mar 28, 2018
Excellent and thoughtful. This paper provides an insightful summary and outlook for the emulsion polymer industry. Thanks for sharing it.

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