Market overview and new applications for oleochemicals in Asia

HYDERABAD 14 APRIL 2016

1.  Oleochemical market dimension and main Players;

2.  Oleochemical opportunities in India;

3.  Single plant versus integrated oleochemical complexes;

4.  Conclusions

AGENDA

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Market perception of Oleochemical

Oleochemical is the sum of the processes which convert the vegetable oil into sustainable products

•  Costant growth of raw material availability

•  “Green Image”

•  Minor toxicity

•  Better dermatological compatibility

Advantages of Oleochemical

1. Oleochemical market dimension and main Players

World oleochemical production

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Fatty Acids production capacity ( 2015) ≈ 11,5 MM Tonn

Fatty Alcohols production capacity ( 2015) ≈ 4,5 MM Tonn

Estimated increase in Oleochemical production 2016 - 2025

7

Kto

n of

Ole

oche

mic

al p

rodu

ct

•  SEAremainthemainproduc2onmarketduetorawmaterialavailabilityand consequent upstream integra2on for all major oleochemicalproducers;

•  Indiaisamarkettobefollowedcloselyduetotheincreasingconsump2onof oleochemicals products.There is poten,al in India for new installedcapaci,esinoleochemical;

•  China remainmainly a consumerofOleoproducts andnot a significantgrowthisforeseeninthenextdecade.Theproduc2onshouldbesensiblylowerthentheinstalledcapacity;

•  FaGy Alcohols capacity increase is strongly influenced by the Crude Oilprice(Synthe2cAlcohols).MainFaGyAlcoholsplayerswillremaininSEA.

Estimated increase in Oleochemical production 2016 – 2025

8

Oleochemical route Market utilization of oleo products

9

Glycerine Market

10

M

M T

onn

Gly

cero

l

Production by Region

•  Market driven by Biodiesel production; •  Oleochemical contribution remain stable;

•  Europe and SEA are main production area; •  China production is smaller then internal consumption;

Current Production

Glycerine Market Estimated production (2025)

11

MM

Ton

n G

lyce

rol

MAIN OLEOCHEMICAL PLAYERS

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2. Oleochemical opportunities in India

1.  High male labour force partecipation rate (age 15+) ≈ 80% (World average ≈ 77 %) (*) 2.  High GDP pro capita increase in the last years; (*)

3.  High potential opportunities in the following industrial sectors:

•  Pharmaceutical; •  Automotive components; •  Food ; •  Soap and Toiletry; •  Detergents & Cosmetics; •  Manufacturing (Steel, coating, resins, pant, polyol,etc);

(*) Source: World Bank 2014 database

INDIA

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Oleochemical Route

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OleochemicalComplex

Fa8yAcids

Deriva@ves

Fa8yAlcohols

Oleochemical Route Fatty acids

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Fa8yAcids

Pharmac.&

Food

Soap,Detergent

&Cosme@c

Candles,Waxes,

&Lubricant

Rubber,Latex,Paints&Coa@ngs

Oleochemical route Fatty Acids derivatives

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Deriva@ves

Cosme@c,toiletry,slipagent&soNener

Biocides,foodprocessing&paper

Elastomers,biolubricants,polyols

&plas@cs

Oleochemical route Fatty Alcohols

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Fa8yAlcohols

Detergent(AES,ES,AS)

Cosme@c,personalcare

Foodproduct,tex@le

Lubricant,plas@cizer,

Glycerine Route

Glycerol Technical Grade

Pharma grade

Cosmetics

Animal food

Tobacco Industry

Pharmaceutical

Food

Polyurethane

Alkid resins

Propylene Glycol

Epychlorydrin

Green Methanol

Etc…

Glycerine route Propylene Glycol

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PG

Deicing/An@freez.

Cosme@c&

Personalcare

Foodindustry

Polyesterresyns

Glycerine route Epichlorohydrin

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ECH

Epoxyresins

Pharmac.Industry

tex@leindustry

WTresins

3. Single plant versus integrated oleochemical complex

Single Plant (up to early 2000)

VEGETABLEOIL

FATTYACIDSCOMPLEX

FATTYALCOHOLSPLANT

DETERGENTSANDSURFACTANTS

Integrated Oleochemical Complex multipurpose industrial area

SULPHONATION

MESFATTYACIDS

ESTERIFICATION

METHYLESTERFRACTIONATION

METHYLESTERSMETHYLESTERHYDROGENATION

FATTYALCOHOLS

TRANSESTERIFICATIONFORBIODIESEL

GLYCEROLESTERIFICATION

Fa8yMa8er

CrudeGlycerine

MONO/DI/TRIGLYCERIDES

FAD

FATTYACIDSPLANT

VEGETABLEOILPRETREATMENT

GLYCERINEREFINING

PHARMAGLYCERINE

FATTYACIDS

Single plant vs Integrated Complex Comparison

SINGLE PLANT INTEGRATED COMPLEX •  STANDARD FEEDSTOCKS WIDE FEEDSTOCKS RANGE (Lauric Oils & Palm Oil) (Lauric Oils, PO, PST, FAD, Sludge Oils,

Acid Oils, etc) •  LOW PRODUCTION FLEXIBILITY HIGH PRODUCTION FLEXIBILITY •  STANDARD PRODUCT SPECIFICATIONS TAILOR MADE PRODUCT SPECIFICATIONS •  STANDARD PLANT CONFIGURATIONS TAILOR MADE PLANT CONFIGURATIONS • LOW INTEGRATION HIGH INTEGRATION WITH OTHER TECHNOLOGIES WITH OTHER TECHNOLOGIES

( Biodiesel, MES, Fatty Alcohols, etc.)

4. Conclusions

Oleochemical business and India opportunities

•  Oleochemical business, perceived as sustainable and green, is growing at constant rate;

•  India has big potential in oleochemical, expecially in Personal Care,

Soap, detergents and manufacturing industry;

•  The availability of unsaturated oil can also create potential for oleochemical derivatives like polyols and biolubricants;

•  the market competition requires the set up of oleochemical complexes, which have to be flexible and able to provide a wide range of products;

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THANK YOU FOR YOUR ATTENTION

Ir.GabrieleBacchiniOleochemicalProductManagerGabriele.bacchini@desmetballestra.com