Interviews with OCQ Group and with Indovinya
Francisco Fortunato, CEO
OCQ GROUP
What synergies have you noticed since acquiring Elekeiroz over the past year?
Elekeiroz has been a major supplier to OCQ for a long time with diverse products. After the acquisition, we have seen growing synergies, specifically with some green monomers that produce more eco-friendly resins. The acquisition has also opened the door for new plasticizers and coalescents, which are still developing but advancing faster than expected. Elekeiroz originally focused on oleates, which we now use more broadly as we shift towards resins. While oleates were once employed as plasticizers, we have transitioned to developing them as monomers and resins for diverse applications. We have found many synergies within this shift with Oswaldo Cruz Química’s resin lines, including acrylics, polyesters, and PVAs.
On the other hand, we have continued investing on Elekeiroz side; we have already started up the DOTP (Dioctyl Terephthalate) plant in Camaçari (BA), as well as investing in Várzea Paulista. For 2024, we are investing US$9 million, aiming to maintain momentum year after year, as continuous investments are crucial for the company’s longevity. How is the market reacting to more sustainable-based chemicals?
To succeed, our products must be competitively priced. While customers are willing to pay a bit more, a substantial price increase would be unacceptable. Fortunately, Brazil’s agricultural base has helped us develop products that can compete effectively in the market. What are some factors damaging Brazil’s chemical industry?
The situation remains worrisome, particularly due to the influx of low-priced imports. While regions like Mexico, the US, and Europe have raised import duties on product from China, this has resulted in a flood of cheaper products entering Brazil.
In Brazil, imports are not regulated, creating an uneven playing field. While we have brought this issue to the government’s attention, implementing new regulations, even if streamlined, could take at least two years.
Additionally, we have a problem with the high costs of gas.
João Parolin, CEO South America
INDOVINYA (INDORAMA VENTURES)
What was the impetus behind restructuring Indorama’s IOD division into Indovinya?
Indorama Ventures is structured around three main divisions: PET, fibers and the IOD division, which specializes in surfactants made from ethylene oxide, propylene oxide and linear alkylbenzene (LAB). The IOD division has seen some significant changes over the years with different acquisitions. We moved raw materials like ethylene and glycols, which have strong connections to the PET market, over to the PET division. The remaining specialties, especially the surfactants, now make up a new entity called Indovinya. We plan for Indovinya to go public and get listed in New York in 2025 or 2026, a move designed to boost its valuation, set it apart from traditional commodity businesses, and highlight our specialized and innovative edge.
Indovinya aims to unlock value and secure growth funding while maintaining a solid market presence. It is set to remain a top producer of non-ionic surfactants and ethylene oxide in the Americas and the second-largest globally in terms of ethoxylation. How is Indovinya’s R&D, innovation and technology evolving?
In the last five years, we have launched about 320 new products, focusing on sustainability and product optimization in collaboration with clients from various sectors, including home and personal care, agriculture, energy, and regulated areas like veterinary and pharmaceuticals. A key focus has been on biosurfactants. For example, we launched SURFONIC® BIO, a biosurfactant that is already making strides in personal care applications. In our crop solutions, we have developed products specifically designed for regions dealing with water stress, which improve soil water retention to boost productivity. We have launched renewable coalescents in the coatings sector, including ULTRAFILM® 5000. We have experienced substantial growth in the coalescents market and were honored last year by the local Brazilian magazine Paint & Pintura, winning awards for the best solvent and coalescent suppliers.
However, we are not stopping at product innovations. We are also actively exploring renewable energy options. On top of that, we are leveraging AI to improve our sustainability metrics, reduce steam and water consumption, and improve production cycle efficiency. Our LAB 4.0 project is about digitizing our R&D operations, using generative AI to speed up project execution.