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Stage 2: Product Development

Research and development

In 2015, we significantly expanded our research activities with third parties in our core areas: agriculture, food, and industrial materials. Also included in these activities are: establishment of an agronomical research collaboration between ICL group and the Volcani Center, whose activities are based in Gilat in the Southern part of Israel, and establishment of a research center in Kunming in China for development of phosphorous based processes and products as part of the transaction for establishment of the YPH JV (joint venture). The incubator (ICL Innovation) operations, which focus mainly on technologies in the initial stages of development and are high risk in comparison with ordinary research and development projects, include 7 on-going projects and 4 new approved ones. During 2015, two projects were transferred from ICL Innovation to two ICL business units for further development and commercialization.
The cross segment development teams that were set up in 2014 by the ICL R&D Management Forum, headed by the CTO, are continuing to work together based on common areas of interest and operations in order to promote the application of new products and technologies.
Our R&D expenses, net were $83 million, $87 million and $74 million in 2013, 2014 and 2015, respectively.

Fertilizers segment’s R&D activities in 2015 focused on the following items:

  • Improvement of processes and reduction of costs in the phosphates and potash plants;
  • Improvement of the quality of the products being sold;
  • Research regarding environmental protection, including development of methods for reducing and treating effluents;
  • Analysis of alternative methods for increasing production capacity of carnallite;
  • Production of a new fertilizer from wastewater flows;
  • Further analysis of adaptation of various types of phosphate rock (bituminous and brown phosphates) for the production of phosphoric acid and its downstream products as part of an effort to exploit and increase existing phosphate reserves;
  • Development of a new process for production of white acid at the China site;
  • Development of products having a high acid content allowing diverse applications of soluble fertilizers;
  • Development of controlled release products with coating materials of compositions and thicknesses unlike those currently available in the market with the addition of micro nutrients;
  • Development of controlled release fertilizers with improved environmental profile;
  • Development of applications preserving water and improving availability of the fertilizers around the root;
  • Geological examination of our concessions in Spain in order to ascertain whether a significant expansion is possible;
  • Examination of technologies for improvement of the production of polysulphate on the Company’s site in the UK; and
  • Development of a manufacturing process for potassium and potassium sulfate in a project of ICL in Ethiopia.

Our Fertilizers segment’s total R&D expenses in 2015 were approximately $22 million.

The R&D activities of our Industrial Products segment are part of the Company’s strategic plan. The global research activities are based on internal research together with joint activities with a wide range of universities and research institutes along with other long term innovative activities. The units execute activities directed at the present and future needs of the market. The activities will be focused primarily on identifying additional uses for bromine or its derivatives, as well as developments in the area of magnesia and phosphorus-based flame retardants.

The R&D activities of our Industrial Products segment are as follows:

  • Brominated polymers: continued development of brominated flame retardants, which are destined to become the generation of environmentally friendly flame retardants, and potential future substitutes of existing products such as DECA and FR 1410.
  • Textiles: continued development of TexFRon®, a series of textile flame retardant products.
  • TexFRon® 4002 is an effective and environmentally friendly solution for diverse textile products, replacing DECA and offering a transparent and laundry durable solution that is not currently available on the market. In the prior year, nylon intensive flame retardant products were developed to satisfy an unmet need in the market. In addition, unique flame retardant system solutions were introduced to the market that do not include Antimony Trioxide (ATO)). These green solutions are creating interest among the Company’s customers and are being commercially evaluated.
  • Energy storage: continued development of bromine based solutions for storing energy using diverse technologies.
  • Ecological research to improve sewage treatment systems, and to reduce air emissions and solid waste.
  • Biocides: continued development of new materials for water treatment and prevention of biofilm (algae) in irrigation systems and water coolants for industry. In addition, there is research activity for polymer synthesis with biocidal activity.
  • Phosphorus based products: development of new reactive phosphorus based products and/or integration of a phosphorus/bromine chemistries mainly flame-retardants for the polyurethane foam (i.e., flexible and rigid foam). A common application of polyurethane flame retardants is in insulation used in the construction, furniture and automobile industries. In addition, new clear solutions are been developed.
  • Support of production: improving product quality and lowering production costs by changing and improving processes, while using the principles of green chemistry (for example, research on the reduction of use of organic solvents in production processes). There is extensive use of a “sustainability index” model for new products, which includes various parameters relating to product properties.
  • Engineering: research in the area of building materials in order to overcome problems of accelerated wear and tear of building materials, corrosion prevention, equipment adaptation, and experiments in accelerated obsolescence.

Our Industrial Products segment’s total R&D expenses in 2015 were approximately $25 million.

 

The principal R&D activities of our Performance Products segment in 2015 were as follows:

Advanced Additives – Phosphoric acid varieties and its downstream products, phosphate salt specialties:

  • Process development for improving competitiveness as a global supplier for phosphoric acid specialties;
  • Flame retardants based on phosphate salts for the automotive industry and for paints & coatings;
  • New cost effective defoamers were introduced into the EU market to service the Mediterranean region during the 2015 European Coating Show. Downstream polyphosphate and polyacrylate dispersants were introduced into the battery market and interior architectural water-based paints. This also included intellectual property filing for a novel additive which allows customers to eliminate or use less biocides in interior paints as the new biocide labeling regulations were promulgated and began to be enforced in mid-2015;
  • Voice-of-customer (VOC) efforts led to the approval of two new corrosion inhibitors for the architectural market in the Do-It-Yourself (DIY) segment. Sales of organic corrosion inhibitors began in 2015;
  • Joint development work with three key customers led to the qualification and approval of our dicalcium phosphate/hydrotalcite corrosion inhibitor for epoxy coatings designed for potable water applications. This patented ICL technology will give us a unique position in this market currently regulated by the National Sanitation Foundation (NSF);
  • As part of our innovation strategy, several new VOC driven projects entered the stage-gate process and were bucketed into two areas of focus: Coatings & Constructions. The Coatings area was further subdivided into wood, metal and concrete sub-segments which together represent an addressable market of approximately $2.5 billion for additives. Construction is comprised of roads & roofs in which asphalt was the primary construction material;
  • R&D projects in Coatings and Construction were chosen based on their ability to address VOC-derived unmet needs in Adhesion, Durability, and Fire Protection;
  • Fire Chemicals: Long-term retardant, fire suppressant foam and water enhancers improve the effectiveness of aerial firefighting. We successfully upgraded three new retardants in 2015 in what was a remarkable year for the Fire Safety business.

 

Food Specialties – Development of innovative formulations for modifying texture and stability of processed food:

  • New dairy ingredient-based products partly developed through new process technology in co-operation with subsidiary Prolactal/Rovita, such as whey protein isolates and concentrates for dairy beverages, cheese and bakery applications.
  • Investigation of properties of vegetable and milk proteins as components for complex formulations, including fundamental research on process parameters;
  • Providing a tool box for modifying texture and stability of food products, including meatless meat (vegetarian meat substitutes). cheese boosters and beverage fortification.
  • Development of novel products by exploiting synergies between food phosphates, proteins, starches and fibers; stabilization systems for sauces, dessert and bakery products;
  • Continued development uses of low sodium salts based on raw materials from the Dead Sea and integration of SALONA into spice blends for meat applications and culinary sauces.