Bioenergy, Hydropower

High Value Products & Diverse Feedstocks: Opportunities for Entrepreneurs

Recently, I was working on a U.S. Department of Agriculture (USDA) grant application for the Biomass R&D program and it quickly became apparent that two key phrases stood out as important — “high value” and “diverse feedstocks.”

The USDA recognized in this program what many advocates of the bioeconomy have been embracing for a long time—there is the opportunity not only to increase biodiversity, but also to discover new entrepreneurial opportunities in a business environment that has progressively become more oriented toward monocultures and consolidation.

A few people reading this will know the history of modern agriculture all the way back to the chemurgic movement which was the early version of our modern bioeconomy advocacy. Such legends as George Washington Carver introduced new crops such as peanuts which dramatically reversed nutrient loss and erosion, while Henry Ford developed plastics made with agricultural feedstocks thereby offering a high-value, non-food product.

Now, almost 100 years later it has taken the huge momentum towards the production of biofuels to begin a serious discussion of “high value” (biobased products) and “diverse feedstocks” (new crops).

A recent example of this phenomenon is the production of camelina in Montana and other western states. This high-yielding crop is being commercialized outside the corporate structure of Monsanto or Pioneer/DuPont, and is rather a collaboration of farmers, entrepreneurs, and university researchers. The new crop brought a smile to the face of many of us who have been frustrated by the vast amount of resources being expended to move the main crops forward such as corn, cotton, and soybeans, while not spending the resources on developing a diverse assortment of crops.

Based on the increasing demand for starch, oil and fiber, and the resulting emphasis on developing new crops, perhaps now we can celebrate the herculian efforts of entrepreneurs such as Tom Rymsza of Vision Paper (paper from kenaf), Jeffrey Martin of Yulex (natural rubber from guayle), and Geof Kime of Stemergy (natural fibers from hemp and flax). These visionaries and many others have lived the dream for a sustainable agriculture and industrial feedstock base and had the guts to keep persevering.

There are several reasons why we need new crops. One is the basic idea that all gardeners realize—a diverse assortment of crops reduces the overall inputs for each one of the crops by improving the soil, attracting beneficial insects, reducing erosion, and countless other benefits. This reduces the amount of pesticides, herbicides, and increases the overall health and biodiversity of the garden.

This same principle is true for industrial agriculture. Growing fifty crops across North America will inherently be healthier for both existing and future crops, all the while increasing biodiversity for wildlife and recreation.

New crops and high-value applications also open up the opportunity for new entrepreneurial innovation and smaller farm-based companies to become involved, thereby offering new intellectual capital and ideas while supporting the tremendous advances being developed by the large lifescience companies.

The “high value” component of the USDA Biomass solicitiation is also very important because generating biofuels is a relatively low margin, high volume product that must be produced as a commodity, thereby requiring large capital investment and factories. In contrast, there are opportunities for both small and large in extracting zein protein, aromatic compounds from lignin, natural fibers from plants, and hundreds of other potential biobased products. By incentivizing these products (i.e. any new non-food product from any agricultural, forestry, or marine raw material) entrepreneurs can target all types of new biobased products as high up the value chain as possible, while still having plenty of material for biofuels.

This article is republished and used with permission of BioDimensions.

Peter Nelson is a principal in BioDimensions, which provides services and makes investments in startup companies developing new green technology, a field he has been involved in since 1996. He is an advisor to companies including Arkansas-based Infinite Enzymes and Ontario-based Stemergy which are both working to introduce new agricultural-based opportunities. Nelson was one of six initial steering committee members for the Southeast Sun Grant Initiative based at University of Tennessee which has received over $40 million in Federal funding for university research. In addition, he was one of three original founders of the Biobased Manufacturers Association (BMA) which helped influence key components of Title IX of the 2002 Farm Bill related to biobased products and renewable energy. He can be contacted by e-mail at [email protected]