Report by Pöyry investigates supply and demand across geographical hubs in the bio-based chemical business.
’BioSight up to 2025’ is the first indepth report to forecast both supply and demand trends in the bio-chemicals sector through to 2025. The report confirms that the bio-based chemicals sector is a growing, global market, but also lifts out both brand pull and the lignin platform as rising stars.
In the report Pöyry introduces its concept for structuring the bio-chemicals sector. Chemicals are divided into sugar, oil, lignin and gas platforms according to their feedstock. These platforms form the basis of the extremely broad spectrum of end-uses including automotive, electronics and packaging. Poyry settled for this platform concept after years of focused work, during which Pöyry has gained unique know-how of the numerous technologies, routes from feedstocks to chemicals and end-use applications in the bio-based industry. Using this knowledge, Pöyry has developed the procedures and tools for reliable supply and demand forecasts.
Pöyry has forecast business opportunities over the coming years for each of the four platforms. First, Poyry’s experts found that whilst the oil and fat platform is the most mature one, 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 underutilised but is a market enabler for lignocellulose sugars and therefore has potential for significant growth.
There is a lack of solid understanding of the demand side and the added value of bio-based components. During the study, Pöyry did an 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 is increasingly brand driven and many leading consumer brands have set targets for introducing bio-based plastics to their products. However, despite rapid growth rates, bio-based plastics will account for less than 2% of the total plastics demand in 2025.
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.
The report raises the key question of whether in the next 10 years, Europe can continue to rely on a technological advantage, given production growth elsewhere” says Katja Salmenkivi, Head of Biochemicals at Pöyry Management Consulting.
The bio-based chemical and polymer industry is acknowledged to be a complex field and a tough business to forecast. However, the Pöyry ’BioSight up to 2025’ addresses these and many other significant market issues. The report offers a unique insight into the bio-based chemical business providing significant value to investors and companies active in the financial sector, forest and agricultural industries, chemical industry, end-users and brand owners as well as to authorities and government agencies.
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Pöyry is an international consulting and engineering company. We serve clients globally across the energy and industrial sectors and provide local services in our core markets. We deliver management consulting and engineering services, underpinned by strong project implementation capability and expertise. Our focus sectors are power generation, transmission & distribution, forest industry, chemicals & biorefining, mining & metals, transportation and water. Pöyry has an extensive local office network employing about 6,000 experts. Pöyry's net sales in 2014 were EUR 571 million and the company's shares are quoted on NASDAQ OMX Helsinki (Pöyry PLC: POY1V).