Abstract
Biofuel and biochemical demand creates hundreds of millions of metric tons of material flows annually. Climbing production increases feedstock needs over the next two decades. By 2030, demand outstrips supply in some regions. When expectations on biomass exceed what productivity gains cannot deliver, feedstock innovation will be instrumental.
Executive Summary
The alternative fuels (AF) and biobased materials and chemicals (BBMC) markets are growing rapidly and putting more strain on today's biomass value chain. The stress is seen today in indirect land-use change, volatile feedstock pricing, and competition with food, among other issues with today's feedstock supply. While these qualitative issues are mounting, in this report we quantify the supply vs. demand issue in biobased fuels and materials (BBFM). We first add up the existing and planned production facilities for alternative fuels and biobased chemicals. Then, we use conversion ratios to translate this demand in gallons and tons of fuels or chemicals into tons of feedstock needed. We then project this out to 2030 using mandate-driven growth rates in most countries for fuels, and moderate growth rates in other regions for fuels and chemicals. Quantifying the biomass demand for fuels and chemicals regionally, we find that sugar crops (mainly corn and sugarcane) and oilseed crops (mainly palm, soy, and rapeseed) drive the market today.
Looking to 2030, annual feedstock demand growth will be 4.9% for sugar crops and 2.4% for oilseed crops, while waste and cellulosic feedstock grow at 20.9% and 26.9% a year, respectively. In 2030, total projected biomass demand for fuels and chemicals is 2 billion metric tons of sugar crops, 310 million tons of oilseed crops, 870 million tons of cellulosic biomass, and 490 million tons of waste feedstock.
Editor's Note:
The text presented here is a reprint of the Executive Summary of a report prepared by Lux Research, Inc. (December 2012;
But can regional biomass supply satisfy this growing demand? We address that question by projecting the growth of key crops out to 2030 using average growth rates. We then compare the supply of biomass to the demand for biomass from fuels and chemicals and find that: • Overall sugar crop demand for fuels and chemicals on the available supply of key crops grew from 16.4% in 2010 to 32.2% in 2030. This is especially stressed in regions like South America and the Association of Southeast Asian Nations (ASEAN). • Overall oilseed crop demand for fuels and chemicals on available supply of key crops grew from 6.6% in 2010 to 7.8% in 2030. This is especially stressed in regions like Europe and East Asia. • Overall cellulosic biomass demand for fuels and chemicals on key sources of cellulosic biomass grew from 0.5% in 2010 to 42.2% in 2030. This is especially stressed in regions like North America and East Asia. • Overall waste feedstock demand for fuels and chemicals on key sources of waste feedstock grew from 1.2% in 2010 to 33.1% in 2030. This is especially stressed in regions like North America, East Asia, and ASEAN.
With the differences in supply and demand, each region has varying levels of scale and penetration, and we define each region as either high growth or low growth, and high penetration or low penetration. Based on this analysis, we find that: • Low scale-low penetration markets, like ANZ [Australia/New Zealand], are opportunities for developing new energy crops. • High-scale, low-penetration markets like Africa are potential exporters and can capitalize on logistical improvements such as “hub-and-spoke” plant setups. • Low-scale, high-penetration markets like East Asia will mainly import, but should expand feedstock portfolios. • High-scale, high-penetration markets like North America will have stressed feedstock assets with volatile pricing, and should tap into waste streams and emerging feedstocks like energy crops immediately.