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Global Materials Of Concern Trends: What Asian Can-maker, Coil Coaters, and

Brand Owners Need To Know

Thomas M al len

Di rector Packaging Globa l Regula tory &

St ra tegic Problem Solv ing

November 1, 2017

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Sherwin-Williams Overview

VALSPAR

+

The Sherwin-Williams Company

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How does a chemical become a material of concern?

The power of the Internet

Stakeholders

The example of BPA

Alternate pathways of concern

Additional Materials of Concern

Asia

Rest of World

Conclusions

Discussion Topics

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• Toxicological Research

• Consumer Health and/or Environmental Advocacy

• Social and Earned Media

• Supply Chain Decisions

• Government Action

Legislation

Regulation

How do materials become a concern?

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Social Media Influence

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The Packaging Value Chain

Can-Makers & Coil Coaters Brand-Owners Retailers NGOsCoatings

Not a complete list of can-makers, brands-owners, retailers and NGOs

INFLUENCE

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What is BPA or Bisphenol A?

Epoxy polymers constitute the main resin in epoxy coatings for

metal packaging around the globe

BPA is a fundamental component in epoxy polymers and polycarbonate plastics

Trace amounts of residual BPA can migrate into the food or beverage

product

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BPA TrendsApproved globally by major regulatory authorities, with limited exceptions

California Prop 65• CA EPA website and

warning label regulation drive conversions to NBPA

Rest of USA• Conversion started 5-

7 years ago due to Food brand-owners’ choice

• NBPA penetration 40% in 2017

France• BPA suspended in

2015

Denmark and Sweden• Campaign against BPA and other

materials of concern driven by major grocers and consumer advocates

Rest of Europe• New regulation

expected by June 2018 to reduce limit of migration

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California Proposition 65 on BPA

• On January 1, 2017, OEHHA’s new BPA regulation went into effect and it will sunset on December 30, 2017.

• Companies need to identify all food products for which BPA was intentionally used to make the can lining, jar or bottle seals including product brand name; FDA product category; UPC or other identifying designation; and (for products transitioned to non-BPA packaging) the last expiration or “use by” date.

• The data is maintained in a publicly accessible OEHHA database. NAMPA reported that the database has about 20,000 product entries, and does not include company contact information:

• Listed BPA May 11, 2015 as a female reproductive toxicant

• May 11, 2016 effective date for BPA

Oral Exposure: No Safe Harbor Level established; POS Signage in force until December 30, 2017

Dermal Exposure: MADL @ 3 micrograms per person/day; Effective October 1, 2016

https://www.p65warnings.ca.gov/bpalist

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Non-BPA Commercial Coatings:Hypothetical Performance Overview

BPA Epoxy Technology A Technology B Technology C

Flavor Retention

Can Corrosion Protection

Fabrication/ Flexibility

Line Yield / Efficiency

Pack Universality

End Use Universality

Applied cost

Solvent and Water BornWater Only Water Only

Commercial Experience

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• Toxicological Research

How do materials become a concern?

• Consumer Health and/or Environmental Advocacy

• Social and Earned Media

• Supply Chain Decisions

• Government Action

Legislation

Regulation

• Absence of Toxicological Research

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BPA and Its Substitutes

BPS

BPF

Styrene

Polyesters

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Other Coating Chemical Issues

China• VOC Limit of 420 g/L • 4% Consumption Tax• 10-20 Yuan per KG Discharge Fee• Emission Permits• Formaldehyde limit raised from 0.1 ppm to 15 ppm

The whole country: 10%↓

The coastal industrial zone: 15%↓(Shanghai、Guangzhou、Tianjin are included)

Coil coating: 70% ↓

Total VOC Emissions Control Plan

10%

↓

15%

↓

13th Five Year Planning for VOCs emission (2016-2020)

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Other Coating Chemical Issues

China• VOC 420 g/L limit• 4% Consumption Tax• 10-20 Yuan per KG Discharge Fee• Emission Permits• Formaldehyde limit raised from 0.1 ppm to 15 ppm

South Korea• K-REACH Chemical Inventory

Regulation• July 2018 Deadline for Phase-in

substances >1 MT

Taiwan• Chemical Inventory Regulation• March 2016 Deadline for

existing substances > 0.1 MT

Thailand• Department of Industrial Works

is building a Chemical Inventory • Expect rules for reporting

chemicals very soon

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Styrene Listing

CAS Number Name SIN Groups

100-42-5 Styrene More info

Reason for inclusion on the SIN List:Styrene is an endocrine disruptor (cat 1). Reprotoxic as well as carcinogenic and mutagenic effects have been reported. It is highly toxic to aquatic species.

REACH status, appears on Source: Registration information Source: ESIS Full registration Hazard class and category code(s) Source: ECHAFlam. Liq. 3 Repr. 2 Acute Tox. 4 * STOT RE 1 Skin Irrit. 2 Eye Irrit. 2

1 results for 100-42-5 in the SIN List.

Search the SIN listSearch your chemicals and we can identify if they areon the SIN List. If not, the SINimilarity tool can tell you

if they are similar to the SIN listed chemicals

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• BPA, BPS, BPF …

• Styrene, Polystyrene

• Phthalates- DIBP, DnPP, DnHP, DCHP, DEHP, BBP, DBP

• Formaldehyde

• Vinyl chloride, vinylidene chloride, PVC

• Perfluorinated compounds

• Organo Tins

• Melamine

• GMOs

Materials of Concern

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Non-BPA Product Portfolio

Epoxy

Epoxy• Very broad

application across most end-use categories

• Portfolio includes industry standard technologies

Non-BPA

Oleo• Limited to 3 Pc

food cans

• Flavor & Pack Limitations

Vinyl• Primarily Food

DRD and 3 Pc Tomato Packs

valPure®

Next Generation Non-BPA Technologies

Acrylic

V40 series

•High performance Non-BPA solutions for Beverage Spray

•Broad Beverage Pack Performance

•Balance of Flexibility and Pack Performance for Food D&I

•Patented Portfolio

Polyester

V30 & V60 series

•Functionalized backbone for high performance products

•Primary Gen I Platform across D&I Food Spray, 3Pc, and Beverage End

•Patented Portfolio

NBPA Epoxy

V70 series

•Epoxy-like application and performance

•Broad application in beverage, food, and general packaging end uses

•Patented Technology

Conventional

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• There are more stakeholders than ever before

• There are more pathways for a material to become a concern

• The extraordinary record of the safety of canned food is untold

• Communication to stakeholders is crucial

Conclusions

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Thank you for your kind attention

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• Food• ~ 55-60% in Europe and North America• High penetration in South East Asia (exports)• Growing in Mexico and Latin America

• Beverage• Still under 10%• France, California (Proposition 65)• Selected brands

• Technology• BPA epoxies (80% of legacy coatings) replaced with multiple chemistry

platforms

1st Generation of Non-BPA Coatings

State Administration of

Taxation:

focus on Implementation to

collection on tax

Ministry of Finance:

focus on drafting collection rate of

tax and revenue

Ministry of Environmental

Protection:

focus on environmental pollution and

VOC emission

China National Coatings Industry

Association:

focus on development of waterborne

coatings

VOC Content

(Ready for

use) more

than 420g/Lto be

collected on

consumption

tax 4%

China Coating VOC Consumption Tax

4% Consumption Tax for Coating with VOC above 420g/L.

Implementation of Coating VOC 4% consumption tax started from

February 1, 2015.

For coating producers

File name Industry measurem

ent unit

Toll

Shanghai

The volatile organic

compounds of the pilot

pollution charge notice

in shanghai(Shanghai

premium [2015] no. 18)

Petroleum chemical

industry, printing ink,

coating, ship industry,

automobile

manufacturing, industrial

coating, medicine,

furniture manufacturing,

electronics, rubber, wood

processing(12 categories)

According to the

emissions fees

10 yuan/kg

(2015.10.1)

15 yuan/kg

(2016.7.1)

20 yuan/kg

(2017.1.1)

Tianjin

Petrochemical industry 、packaging and printing

industry volatile organic

compounds emission

charge note （Tianjin

hair change price tube

[2016] no. 2016）

Petroleum chemical

industry, packaging and

printing industry

（2categories）

According to the

emissions fees 10 yuan/kg

Guangzhou / / / /

VOCs Discharge Fee

Shanghai

1.(DB 31/881-2015) Air pollution emission standards of coating、print ink and related product manufacturers

2.(DB 31/933-2015)comprehensive air pollution emission standard

Guangdong

（DB 44/816-2010）VOC emission

standard of

automobile surface

coating

Tianjin

1.(DB 12/524-

2014) VOC

emission control

standard of

industrial

enterprise

2. (DB 12/059-

1995)Emission

standard for odor

pollutants

Existing Provincial Regulation

Emission Permit Implementation Schedule排污许可证实施时间表

Petroleum

enterprise

2017 2018

other

other

Coating industries

The Future of Coating Products (Low VOC)

Water-

based

productsUV light

curing

products

high solid

products

low VOC

products