BioSight up to 2025: Changes in supply and demand affecting the global bio-based chemical industry

(Editor's note: Based on a news release from Pöyry date April 9, 2015)

Pöyry Management Consulting has released BioSight up to 2025, a cutting edge report investigating changes in supply and demand affecting the global bio-based chemical industry. In the report Pöyry forecasts supply and demand trends in the bio-chemicals sector through to 2025, and introduces its concept for structuring the bio-chemicals sector. It confirms that the bio-based chemicals sector is a growing, global market, and suggests that both brand pull and the lignin platform are rising stars.

The report concentrates on a selection of bio-based chemicals (approx. 40), where Pöyry has identified interesting business opportunities over the years. These chemicals are divided into four platforms according to their feedstock: sugar, oil, lignin and gas. To highlight the recent developments, established bio-based commodities such as ethanol, lysine and sorbitol were excluded from the scope.

These platforms form the basis of the extremely broad spectrum of end-uses including automotive, electronics and packaging. Pöyry settled on this platform concept after years of focused work, during which they gained unique know-how of the numerous technologies, routes from feedstocks to chemicals and end-use applications in the bio-based industry.

According to the report, there will be business opportunities over the coming years for each of the four platforms. First, while the oil and fat platform is the most mature, sensibilities around sustainability arguments mean future supply is uncertain. In the coming years, Pöyry believes that the European market will invest effort in supplying lignin. The report makes this assessment on the basis that lignin is currently underutilized but is a market enabler for lignocellulose sugars and therefore has potential for significant growth.

The report says that there is a lack of solid understanding of the demand side and the added value of bio-based components. The study includes Pöyry's estimation of bio-based plastics as a large end-use by itself for bio-based chemicals, representing approximately 900 kt in 2013. Demand for bio-based plastics depends on various factors including i.e. opportunities for GHG savings, cost-competitiveness and application development. But the role of brand owners is increasing in importance and many leading consumer brands have recently set specific targets for introducing bio-based plastics to their products. It is expected that the trend of brand owner targets will expand from innovators to early adopters by 2025. However, despite rapid growth rates, bio-based plastics will account for less than 2 percent of the total plastics demand by that time.

According to the report, changes to supply and demand will affect the various geographical hubs that dominate the biochemicals industry. Asia leads global production and is expanding thanks to significant government support. Globally, North America, Europe and Brazil all compete with specific competitive advantages.

For more information or to order a copy of the report, go to: www.poyry.com/biosight or contact Simon Rendell at: simon.rendell@hkstrategies.com

Pöyry is an international consulting and engineering company serving the energy and industrial sectors and providing local services in core markets including power generation, transmission & distribution, forest industry, chemicals & biorefining, mining & metals, transportation and water. www.poyry.com.

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