Post on 03-Jul-2020
The Emergent BioProducts Industry
Dr. Jay S. Golden, Director Duke Center for Sustainability & Commerce
Associate Professor of the Practice for Sustainable Systems Analysis
Duke University
The Traditional Is No More
Energy Materials Products
“The 20th century was the age of the fossil-based economy. Cheap energy drove growth and prosperity for much of the world. Now, we need to develop new technologies to sustain the needs of
a growing population. This is the age of the bioeconomy.” (DuPont, 2012)
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Our Database is sortable by: Region/Country; Crop; Year
Morrison and Golden, 2015, An Empirical Analysis of the Industrial Bioeconomy: Implica;ons for Renewable Resources and the Environment. BioResources, Vol. 10 #3.
Trade Flows of the Bioeconomy Los flujos comerciales de la Bioeconomía (2011)
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Maize Soybeans
Sugar Palm Oil
Cotton
Europe West Asia
Oceania
Africa
SE Asia
Embedded Resources in Global Trade,
2011
Fer$lizer Embedded in Export
Embedded H2O in Exports
Export (MMT) (m3 where indicated)
Total Produc$on (MMT)
Export % of Total
Produc$on
N (MMT)
P2O5 (MMT)
K2O (MMT)
Green Water (m3)
Blue Water (m3)
COTTON 10.9 25.9 42% 1.75 0.71 0.49 8.9E+10 3.2E+10 MAIZE 115.3 887.9 13% 1.90 0.72 0.56 1.1E+11 6.8E+09
PALM OIL 41.3 49.3 84% 0.86 0.31 1.67 2.1E+11 1.9E+07 SOYBEANS 138.2 261.9 53% 0.22 1.64 1.67 2.9E+11 6.0E+09 SUGAR 33.0 171.1 19% 0.53 0.19 0.51 4.7E+10 4.9E+09
INDUSTRIAL ROUNDWOOD 119 m3 1,082m3 11% ** Forthcoming
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0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
1,00E+00 1,00E+01 1,00E+02 1,00E+03 1,00E+04 1,00E+05 1,00E+06 1,00E+07 1,00E+08 1,00E+09 1,00E+10 1,00E+11 1,00E+12 1,00E+13
CoVon Lint
Maize Palm Oil Soybean Sugar
Percentage of Total Produ
c$on
Exported
Water Use (m
3 )
Key Agricultural Bioeconomy Crops
Green Water For Produc;on
Green Water for Export
Blue Water for Produc;on
Blue Water for Export
Percentage of Total Produc;on Exported
Today’s Discussion First, what the United States is doing to promote and grow the BioProducts industry – and why? Secondly, how “Global Industry” is developing programs to respond / promote and grow the BioProducts industry?
Opportunities for Colombian Palm Oil sector.
What is the BioProducts Industry?
• Congress of the United States required a study to quantify the importance of the BioProducts Industry in the United States BEFORE they authorized the new Farm Bill of 2014.
• $956 billion over 10 years
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An Economic Impact Analysis of the U.S.
Biobased Products Industry: A Report to the Congress of
the United States of America.
• > 157,000 downloads • > 164 million media impressions
Our Report
Goals of the Report Determine the:
1. Quantity of biobased products sold 2. Value of biobased products 3. Quantity of jobs created 4. Quantity of petroleum displaced 5. Other environmental benefits 6. Areas in which the use or manufacturing of biobased
products could be more effectively used, including identifying any technical and economic obstacles and recommending how those obstacles can be overcome.
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U.S. BioProducts Sector Grouping
Included • Agriculture and forestry • Biorefining • Enzymes • Biochemicals • Textiles • Forest products • Plastic bottles and packaging
Excluded • Energy • Livestock • Food • Feed • Pharmaceuticals
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x
The Number of American Jobs
Contributed
4 Millionby the U.S. Biobased Products Industry in
2013
Value added Contribution to the
U.S. Economy
$369 Billionfrom the U.S.
Biobased Products Industry in 2013
The Jobs Multiplier
2.64For every 1 Biobased
Products job, 1.64 more jobs are created in the United States
Figure 1: Key Findings of the U.S. Biobased Products Industry in 2013
Figure 2: Total Employment and Value Added to the U.S. Economy from the Biobased Products Industry in 2013
1.52
1.11 1.39
4.02
$125.75$126.01
$117.54
$369.30
$0
$50
$100
$150
$200
$250
$300
$350
$400
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
4.50
Employment Value Added
Bill
ion
Do
llars
Mill
ion
Fu
ll-an
d P
art-
Tim
e Jo
bs
Direct Effect Indirect Effect Induced Effect Total Effect
Total Economic Impact National Level - BioProducts
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x
The Number of American Jobs
Contributed
4 Millionby the U.S. Biobased Products Industry in
2013
Value added Contribution to the
U.S. Economy
$369 Billionfrom the U.S.
Biobased Products Industry in 2013
The Jobs Multiplier
2.64For every 1 Biobased
Products job, 1.64 more jobs are created in the United States
Figure 1: Key Findings of the U.S. Biobased Products Industry in 2013
Figure 2: Total Employment and Value Added to the U.S. Economy from the Biobased Products Industry in 2013
1.52
1.11 1.39
4.02
$125.75$126.01
$117.54
$369.30
$0
$50
$100
$150
$200
$250
$300
$350
$400
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
4.50
Employment Value Added
Bill
ion
Do
llars
Mill
ion
Fu
ll-an
d P
art-
Tim
e J
ob
s
Direct Effect Indirect Effect Induced Effect Total Effect
What the BioProducts Industry Means to USA
How Big is BioProducts Sector?
BioProducts
Total of 7.25 million U.S. jobs. Generating $500 billion in annual compensation.
4 million U.S. jobs. $369 billion in overall value added
X
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We also analyzed the relative employment contribution of the bioeconomy at the state level to its national share of the U.S. economy. We calculated the percent of state employment in an industry divided by the percent employment in the same industry in the United States. This measure is called a location quotient (LQ), and if it is greater than 1.0, it means the state is more specialized in the biobased products industry relative to the U.S. A LQ of less than 1.0 means it is less specialized. Figure 3 shows that the LQs for the contiguous 48 states. States with the greatest concentrations of biobased products industrial activities are Mississippi, Oregon, Maine, Wisconsin, Idaho, Alabama, North Carolina, Arkansas, and South Dakota. Figure 3: Location Quotient for the Total Biobased Products Industry in 2013
Note: Darker green and higher numbers indicates increased activity at the state level relative to the U.S. in the biobased products industry. For more information, see section II. Below we provide concise responses to the six questions posed in the 2014 Farm Bill reauthorization. (i) The quantity of biobased products sold While there is no database that tracks the “quantity of biobased products sold,” the BioPreferred program database includes about 20,000 biobased products. This database contains very few forest products or traditional textile fiber products because these products were only included in the program recently. Therefore, we estimate that the actual number of biobased products is dramatically higher than the number in the BioPreferred program database. In terms of jobs created and value added, the forest products segment alone more than doubles the estimates for the remainder of the biobased products sector. Thus, 40,000 would be a conservative estimate of the total number of existing biobased products. Sufficient data to estimate the total number of
Location Quotient (LQ) Total Biobased Products Industry
LQ is a measure of industry intensity in rela;on to a na;onal average intensity – Rural Areas Play a Major Role!
LQ values greater than 1 will likely export bioproducts
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detail in the segment-specific paragraphs following Figures 16 and 17, and at the end of this report in the sub-section “Emerging Trends in Biotechnology Innovation.” Each of these factors will have a measurable impact on the rate of growth of the sector, thus, forecasting a range of growth is challenging and dependent on multiple factors. 1. New venture capital investment has
slowed in recent years, but shows promise of increasing by five to 10% in the next five years provided that the right conditions are in place.
2. New technologies will be tied to readily
available feedstocks, which could be in short supply going forward.
3. Successful technology development must be based on solid execution and business fundamentals.
4. Selection of the right supply chain technology partners is key, along with understanding the right market requirements for success.
5. Easy venture capital funding is no longer a reality, so long-term partnerships and alternative sources of funding are needed.
Figure 16: Estimated Growth in Employment from 2015 through 2020 for the Biobased
Products Sector in the U.S. Excluding Enzymes
4,500,000
4,600,000
4,700,000
4,800,000
4,900,000
5,000,000
5,100,000
5,200,000
5,300,000
5,400,000
2015 2016 2017 2018 2019 2020
Jobs
Year
U.S. Employment Growth Biobased Industries
(Excluding Enzymes)
Applications of
Biofeedstocks First Genera;on
Second Genera;on
Third Genera;on
by 2020
Sources: Neff 2012; Cohen 2013
7% by 2020
15% by 2025
9% by 2030
Global Economic Value by 2020 – Projected Global Valor Económico para el año 2020 - Proyectado
X
Traditional petroleum-based feedstocks are
harder to access, leading to great
investment and costs
Government policies and incentives that include mandates,
subsidies, tax credits, etc.
Desire for more sustainable products
with lower environmental and
social impacts
Market-Based Regulatory Financial
Demand Drivers Cost Drivers
Drivers of BioProducts
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Example Drivers of BioProducts
BioPreferred Program (2002 & 2008)
Industry Consortium & the use of Life Cycle Assessments (LCA)
National BioEconomy Blueprint (2012) & Executive Order 13514 (2009) $445B/annual govt spend on products
Grenelle II Act (2012)
Voluntary Government Labeling Initiative
• > 2,200 USDA Certified Biobased Products • Companies from 43 Countries Participate • Biobased content is third-party tested &
verified using ASTM D6866. • Product’s biobased content must meet
standard for product category in US CFR Title 7 part 3201
• If not in part 3201, minimum biobased content requirement is 25%
Sustainability Consortium
The Future
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Bioplastics Plásticos
• Bioplastics represent only 1% of the total plastics market today, but are projected to grow to 7% by 2020.
• Projected to grow from 3.36 Mt of plastic in 2007 to 6.45 Mt in 2020.
• >90% of total plastic production is feasible to be substituted with bioplastics.
• Consumption of bioplastics by the packaging industry will amount to 1.3M tons in 2013.
• Packaging expected to hold a majority of the market share of bioplastics through 2020.
• Production is shifting to Asia and South America.
• By 2020, 80% of bioplastics production will be produced in these regions. What opportunities are there for Americas?
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World Bioplas$cs Demand (1000 metric tons)
% Annual Growth
2005 2010 2015 2005-‐2010 2010-‐2015
Global 130 300 1,025 18.2% 27.9%
North America 34 80 242 18.7% 24.8%
Western Europe 60 125 347 15.8% 22.7%
Asia/Pacific 33 83 320 20.3% 31.0%
Other Regions 3 12 116 32.0% 57.4%
Sources: (Freedonia Group Inc., 2011) (Nanomarkets, 2012) (European Bioplas;cs and University of Applied Sciences and Arts Hanover, 2012) (Newes et al. 2012)
Bio-‐PE 26%
Bio-‐PET 17%
PLA 13%
PHA 9%
Biodegradable Polyesters
9%
Biodegradable Starch Blends
7%
Bio_PVC 7%
Bio-‐PA 4%
Regenerated Cellulose
2%
PLA-‐Blends 2%
Bio-‐PP 2%
Bio-‐PC 1%
Others 1%
Biopolymer Produc;on Capacity -‐ By Type (2015)
Biochemical Sector Growth • Production of chemicals and materials from biobased
feedstocks will increase substantially from 5% (~12.5 billion lbs.) of the current production of chemical commodities in the U.S. in 2001 to 12% in 2010, 18% in 2020, and 25% in 2030.
• Globally, only 3% (~$100 Billion) of all chemicals were bio-based in 2009.
• Could swell to 15% by 2025 ($3 Trillion)
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Sources: Golden & Handfield (2015). Journal of Industrial Biotechnology August Edition
Intermediate Products Intermediate Ingredient or Feedstock • Undergone value added processing
• thermal • chemical • biological • mechanical
• Sold by manufacturer/vendor to make a more complex compound or finished product
Complex Assembly Distinct materials and components assembled to create a finished product with specific functional intent
Colombian Palm Oil Do NOT let Palm Oil’s environmental impacts in OTHER regions dictate the sustainability story of Colombian Palm. Colombian Palm is “Palm Oil of the Americas” – develop and tell the positive story.
Opportunities for Colombia • Building internal demand is important but, • With a surplus in supply Colombia should
identify export opportunities. • Commodity (Palm Oil) vs. Finished Good • “Made in Americas” is a great story – sell it. • As shown opportunities exists for both global
customers & consumers-especially in the United States.
• Independent, transparent and credible analyses of environmental and health values of Americas palm.
An Important Beginning Un inicio importante
Product category LCA’s
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Final Products • An economic
opportunity vs. selling just a commodity
• “Made in Americas” • Health Benefits • Leverage the Right
Retailers • Don’t Depend on
Existing 3rd Party Brands-Build your own
Palm Oil in Americas Fedepalma and Cenipalma are essential to improving farming practices and productivity. Building on this strength, I strongly suggest research be done on the following to develop business development strategies. • Baseline Life Cycle Assessments include “dynamic /
attributional and consequential LCA’s. • Logistics Analysis for getting products to global market. • Marketing approaches for Palm Oil of Americas
BioProducts Industry Consortium
In November, there will be the first gathering of companies to discuss the crea;on of a global BioProducts industry consor;um to advance and increase the market for BioProducts. If you are interested, please email Dr. Golden
En noviembre , tendrá lugar la primera reunión de las empresas para discu;r la creación de un consorcio mundial de la industria BioProducts para avanzar e incrementar el mercado de BioProducts . Si usted está interesado , envíe un correo electrónico a Dr. Golden
To Obtain “Free” Copies of the 3 Reports:
Para obtener copias ” gratis " de los 3 informes
www.researchgate.net/profile/Jay_Golden
Contact Dr. Jay S. Golden
Duke University
Email: Jay.Golden@duke.edu
Web Site: http://center.sustainability.duke.edu 33