The event held by Infocast in Milan on the 8th-10th of February was a great success. A number of important speakers were present and a good cross section of the industry was present. Industrial Biotechnology is beginning to mature as an industry. It is finding its practical strengths and intelligent solutions are being found to address some of its weaknesses. Customer demand is rising and the market share of Industrial Biotech is increasing.
All parts of the value chain were present; feedstock companies, chemical companies, technology companies, biorefineries and a number of other groups such as R&D companies, downstream users and NGOs were also present. Industry segments such as bioplastics, biobased chemicals and biofuels were represented. Market research companies such as Lux Research were involved as were consultants such as Corinne Young.
From looking at this cross section of the industry, there are a few clear trends that showed in their presentations and in interviews. Many manufacturers are aiming to provide sustainable alternatives to current products sourced from petrochemicals. Biobased chemicals are generally seen as the most viable segment of industrial biotechnology. Genomatica focuses on sustainable chemicals production and is closing in on to the goal of producing basic and intermediate chemicals from bio feedstocks in a way that is competitive with products manufactured from petrochemicals. The strength of biobased chemicals is in the logistics as lower volumes of product and feedstock are involved and also in the environmental benefits, which are more pronounced and easier to maintain at this smaller scale. Biofuel is seen as less viable at present; pressures from the volume at which biofuels need to be produced and competition with existing petrochemicals is still a challenge to the industry that has ended many start up projects. However, an interesting point was made by Corinne Young regarding existing vs developing biofuel technologies. Food crops such as wheat have been bred for thousands of years for easy cultivation and high yields, while many of the second generation biofuel crops currently under development haven’t had such a period of domestication and optimization. She also highlighted market forces which mean that food and fuel prices don’t necessarily compete with each other.
All segments show signs that they will grow and that their market share will increase relative to petrochemicals. Part of this is likely to be due to consumer pressures, for example, in bioplastics there is consumer and regulator pressure to replace petrochemical derived plastic bags with biodegradable bioplastics. Genomatica found 57% of companies believe that in general we should be moving away from petrochemical based products. The prices of various bioderived feedstocks are much less volatile than the price of oil, which is an attraction to manufacturers who are worried about how the rising price of oil will affect their business. In many cases biofeedstocks are cheaper than oil, however the processing step adds to the cost. An interesting point that was made was over using natural gas as a feedstock; its price is much less volatile than the price of oil. In some cases biofeedstocks will have to compete with natural gas which could prove a greater challenge than petrochemicals. Growth is seen to be most likely for bioproducts which are feeding into existing markets rather than those which are novel, which is particularly true for bioplastics. Drop in, chemically identical products sourced from biofeedstock rather than petrochemicals are the products that are performing the best. Prices of biotech products are mostly driven by supply, rather than demand as is the way with petrochemical products, so as manufacturing volumes increase biotech products will become more attractive to consumers.
A number of practices are becoming more common among manufacturers. Life cycle analysis and supply chain approaches to technology development are being used extensively by a number of manufacturers, for example Chemtex. They approach technology development from three angles; feedstock production, feedstock conversion to fermentation feed and finally biofuel production by fermentation. Natureworks analysed the production of their Ingeo polymer with a “cradle to factory gate” approach, comparing it to a range of other polymers in a similar way and reaching the conclusion that their manufacturing process produced the least carbon emissions of the polymers they looked at. Analysis of this kind is proving useful to ongoing R&D, as it highlights areas for improvement; Natureworks are aiming to keep driving down the CO2 emissions of Ingeo production. Flexibility is also an important development for some companies; the prices of various biofeedstocks fluctuate depending on a number of factors, so at some times it makes more economic sense to use different feedstocks. Having technology flexible enough to do this gives an advantage to the manufacturer.
Automotive applications of biotechnology are becoming more common. Aside from the obvious use of biofuel in cars, a number of manufacturers are looking at the use of biopolymers. Often these applications are for bioderived fibers, as interior upholstery or for plastics to use in panels. Some high performance bioplastics are used in engine components such as seals.
All parts of the value chain were present; feedstock companies, chemical companies, technology companies, biorefineries and a number of other groups such as R&D companies, downstream users and NGOs were also present. Industry segments such as bioplastics, biobased chemicals and biofuels were represented. Market research companies such as Lux Research were involved as were consultants such as Corinne Young.
From looking at this cross section of the industry, there are a few clear trends that showed in their presentations and in interviews. Many manufacturers are aiming to provide sustainable alternatives to current products sourced from petrochemicals. Biobased chemicals are generally seen as the most viable segment of industrial biotechnology. Genomatica focuses on sustainable chemicals production and is closing in on to the goal of producing basic and intermediate chemicals from bio feedstocks in a way that is competitive with products manufactured from petrochemicals. The strength of biobased chemicals is in the logistics as lower volumes of product and feedstock are involved and also in the environmental benefits, which are more pronounced and easier to maintain at this smaller scale. Biofuel is seen as less viable at present; pressures from the volume at which biofuels need to be produced and competition with existing petrochemicals is still a challenge to the industry that has ended many start up projects. However, an interesting point was made by Corinne Young regarding existing vs developing biofuel technologies. Food crops such as wheat have been bred for thousands of years for easy cultivation and high yields, while many of the second generation biofuel crops currently under development haven’t had such a period of domestication and optimization. She also highlighted market forces which mean that food and fuel prices don’t necessarily compete with each other.
All segments show signs that they will grow and that their market share will increase relative to petrochemicals. Part of this is likely to be due to consumer pressures, for example, in bioplastics there is consumer and regulator pressure to replace petrochemical derived plastic bags with biodegradable bioplastics. Genomatica found 57% of companies believe that in general we should be moving away from petrochemical based products. The prices of various bioderived feedstocks are much less volatile than the price of oil, which is an attraction to manufacturers who are worried about how the rising price of oil will affect their business. In many cases biofeedstocks are cheaper than oil, however the processing step adds to the cost. An interesting point that was made was over using natural gas as a feedstock; its price is much less volatile than the price of oil. In some cases biofeedstocks will have to compete with natural gas which could prove a greater challenge than petrochemicals. Growth is seen to be most likely for bioproducts which are feeding into existing markets rather than those which are novel, which is particularly true for bioplastics. Drop in, chemically identical products sourced from biofeedstock rather than petrochemicals are the products that are performing the best. Prices of biotech products are mostly driven by supply, rather than demand as is the way with petrochemical products, so as manufacturing volumes increase biotech products will become more attractive to consumers.
A number of practices are becoming more common among manufacturers. Life cycle analysis and supply chain approaches to technology development are being used extensively by a number of manufacturers, for example Chemtex. They approach technology development from three angles; feedstock production, feedstock conversion to fermentation feed and finally biofuel production by fermentation. Natureworks analysed the production of their Ingeo polymer with a “cradle to factory gate” approach, comparing it to a range of other polymers in a similar way and reaching the conclusion that their manufacturing process produced the least carbon emissions of the polymers they looked at. Analysis of this kind is proving useful to ongoing R&D, as it highlights areas for improvement; Natureworks are aiming to keep driving down the CO2 emissions of Ingeo production. Flexibility is also an important development for some companies; the prices of various biofeedstocks fluctuate depending on a number of factors, so at some times it makes more economic sense to use different feedstocks. Having technology flexible enough to do this gives an advantage to the manufacturer.
Automotive applications of biotechnology are becoming more common. Aside from the obvious use of biofuel in cars, a number of manufacturers are looking at the use of biopolymers. Often these applications are for bioderived fibers, as interior upholstery or for plastics to use in panels. Some high performance bioplastics are used in engine components such as seals.
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