The market of ingredients for household, industrial, and institutional (HI&I) cleaning applications is going through changes across all regions of the world. Innovation in dosage forms, increasing disposable income in developing countries, increasing importance of the green movement, and environmental regulations are some of the key trends driving those changes. Herewith, we are highlighting some early findings from our HI&I study, scheduled to be published in Q4 2020. In this blog, we will focus on the United States, Europe, and China. Our next blog will cover the remaining regions included in the study: Brazil, India, Southeast Asia, and the Middle East.
The pandemic and increasing demand for cleaning and sanitizing products have been positively affecting and changing the industry of HI&I ingredients in the United States. For example, the up–until–now key trend toward green ingredients has been left behind in the U.S. market as ingredients claiming to be effective against pathogens—such as disinfectants containing quats—grew in demand despite concerns about the harm that they can cause to humans or the environment. In other categories of ingredients, surfactants—which is the largest in volume, depending on the specific use—showed a slight increase during the pandemic. Some surfactants showed a higher consumption rate, while others showed no year-on-year change.
The demand for cleaning products in the household sector skyrocketed during March and April, and the following months remained higher compared to year-over-year, with some categories—such as disinfectants and bleaches—increasing by more than 50% year-over-year. While in the household sector, the demand showed significant growth, the I&I sector struggled and faced decline. Categories of ingredients related to floor care were hit hard. Surface disinfection presented a higher demand in some places, such as hospitals and public premises, but dropped dramatically because of the lockdown of restaurants, offices, shops, and schools that remained closed during the first months of the pandemic.
Over the next few years, the industry is expected to have a positive CAGR. Awareness of hygiene and proper cleaning will further drive the demand for cleaning products and, therefore, ingredients. Finally, it is important to note that, during interviews, suppliers of ingredients in the cleaning industry showed confidence in the near future.
The finished products market continues to move from powder to liquid form–detergents, and there is an increase of unit dose.
Volumes of I&I cleaning products have decreased due to HoReCa segment closures. However, overall volumes for the HI&I ingredients did not decline as the demand from the household segment increased compensating the loss from the I&I segment. Currently, disinfection is the key application and expected to remain a key application in the near future. As a result, in Europe, the demand for quats, which is the most consumed disinfectant, has increased by 50%.. There is a slight increase in powder detergents compared to previous years; this is linked to two reasons: loss of purchasing power for some people during the pandemic and attributions of a higher power of disinfection. However, due to new BPR guidelines expected by 2021-2022, it is expected that antimicrobials usage may face higher regulatory pressures, however, it is not clear until the guidelines come out.
The market of HI&I cleaning industry in China is mature, and price is regarded as the key factor for cleaning product manufacturers when choosing ingredients and designing formulas. The outbreak of COVID-19 has positively affected household product consumption in China. Similarly, the I&I segment has been adversely hit due to lockdowns and social distancing policies, as well as wide safety concerns for going out for social/entertainment purposes. The Chinese HI&I ingredient market is forecast to maintain moderate growth during the forecast period.
Despite lagging behind developed countries, detergents are trending toward liquid, high concentrations such as unit dose, and biodegradability due to growing sustainability efforts in China. These efforts are driven by government legislations and leading companies alike, and the trends will shape demand for ingredients in the coming years. For example, nonionic surfactants will benefit from the increasing adoption of high concentrated detergents, and biodegradable products will drive the use of enzymes.
These are only preliminary findings. To gain in-depth 2020 data and insights on this market, subscribe to our Ingredients for Household, Industrial, and Institutional Cleaning Applications report. It examines the ingredients market for cleaning applications globally with a focus on the seven most important markets. The study has two deliverables: Database and Report. One report per region will focus on key trends, drivers, and restraints in the market.