Advanced Bioeconomy Conference: Some Scale-Up Successes, but Still a Shadow of Conventional Biofuels 

These are excerpts from a complete review of ABLC by Raymond James Senior VP Pavel Molchanov, which you can read here.

While the tone (on the whole) is no longer worsening, it is far from being as optimistic as it had been in the early years of this decade. This has little to do with the oil price down cycle, and public policy is also a minor culprit. Rather, the problems are almost entirely internal to the industry itself. Both Gen2 biofuels and non-fuel biomaterials have not been able, for operational/technical reasons, to successfully achieve commercial scale in most attempts.

Gen2 biofuels: Other than renewable diesel, only a few commercial successes – still awaiting cellulosic ramp. Here is one datapoint to frame the persistent lack of scale-up in Gen2 biofuels: Green Plains (the third-largest U.S. corn ethanol producer) in 2016 sold 1.15 billion gallons, which single-handedly surpassed the volume of all Gen2 biofuels in the U.S. and probably the world…So, is there hope for scaling up Gen2 biofuels? Yes, eventually, but there is no realistic prospect for production to become needle- moving (relative to conventional biofuels) until well after 2020.

Chemicals and specialty biomaterials: scale-up remains slow, but premium margins are attracting more investment. We remarked in last year’s conference recap that numerous bioindustrial developers have been shifting away from fuels and towards chemicals, plastics, nutrition, and other specialty end markets….Other examples of strategic partnerships include Anellotech’s bioplastics work with Suntory, Avantium’s polymer joint venture with BASF (helping support Avantium’s pending IPO), TerraVia’s algae-based nutrition collaboration with Unilever, and Verdezyne’s dodecanedioic acid project with Sime Darby.