SCUP Report

Table of Contents

Abstract

A biocide can be defined as any substance that kills or inhibits the growth of any living organism. However, this definition covers a much broader range of functional products than those normally considered biocides by the chemical industry. Chemicals that are medium-specific in their activity—normally designed to control a broad range of less complex microorganisms (e.g., bacteria, fungi or algae) in household, institutional and industrial applications—and that are also relatively nontoxic to higher life forms at common usage levels are what the chemical industry commonly refers to as biocides.

The specialty biocides described in this report include many different chemical types that are used in a variety of end-use areas. They are linked only by their common functionality in destroying or inhibiting the growth of a broad range of microorganisms. These specialty biocides have been subdivided into eight product categories—active halogen compounds, inorganics, organic acids and salts, quaternary ammonium compounds, phenolics, organosulfur compounds, organometallics and other biocides. Chemicals that are highly lethal to all living things (e.g., hydrogen cyanide), pharmaceuticals, chemicals used solely to control agricultural pests (i.e., pesticides) and commodity biocides (e.g., sodium hypochlorite and alcohols) are excluded.

The following pie chart shows world consumption of specialty biocides by region on a volume basis:

Growth will be fastest in China (over 5% per year), followed by Other Asia, Central and South America, and Central and Eastern Europe. In the developed regions—North America and Western Europe—growth will be slower; for Japan, stagnation or only slow growth is expected. China has overtaken Western Europe as the second-largest market by volume worldwide, although the Western European market remains larger in value. Growth in China is driven by all sectors of the Chinese economy.

The major markets for biocides are in wood preservatives, swimming pools, sanitizers and disinfectants, food and feed preservatives, industrial water treatment, personal care products, metalworking fluids, and paints, coatings, and plastics. The most profound changes in recent years have been in the wood preservative market, where large volumes of arsenic-based inorganic biocides have been replaced by alternative products of much higher cost. As a result of the economic and financial crisis, consumption of biocides grew only marginally largely because of weak demand across several applications. Consumption in swimming pools and spas, wood preservation and paints/coatings/adhesives was greatly affected by the economic slowdown as construction/remodeling activity slumped and foreclosures skyrocketed. Applications in food/feed preservation and sanitizers/disinfectants and other applications were less impacted by the global recession.

An important consideration is the impact of government regulations. In the United States, Western Europe, Japan and China, as well as elsewhere in the world, these regulations require the registration of biocides, a process that includes lengthy and expensive toxicological tests that are designed to demonstrate whether the products can be used safely. These regulations require expertise and infrastructure in order to comply with them, and they were a major reason why many large companies that first entered this business were often large manufacturers of pharmaceuticals or pesticides and already had similar biological testing capabilities and registration groups. Over time, newer regulations in most world areas have further restricted or banned the use of some biocides and stimulated the use of acceptable replacements of lower human toxicity.

Because of the increasing cost of complying with these regulations, very few new products have been introduced in the past five years. Since the Biocidal Products Directive entered into force in mid-2000 in the European Union, about two-thirds of approximately 1,000 biocide actives have disappeared from the market. No company in the biocides field is known to be developing new biocidal actives in this region. Increasing costs also led to further consolidation within the industry, as the smaller producers were forced to withdraw from the basic production of biocides because their lower sales volumes could not justify these added costs. This process is continuing and several large companies may emerge with significant participation in a broad range of biocides.