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Bioplastics set for growth phase, contingent on successful execution of market-pull strategy

John Baker, global editor at ICIS, explains that the bio-industry is recognizing that stimulating market pull, rather than technology push, will be essential to driving up the demand for bioplastics

December 19, 2013
In a recent market outlook report, Baker points to the Freedonia Group‘s World Bioplastics study on the global demand for bio-based and biodegradable plastics. The study projects that demand will increase by 19% per year to 960,000 metric tons (MT) by 2017.

At this year’s European Forum for Industrial Bio-technology and the Bio-based Economy (EFIB) in Brussels, a panel session addressed the topic of market pull and consumer attitudes toward bio-based materials.  The panel examined how end-user companies determine what products to replace and in which regulatory environments they require support.

In Baker’s article, BioAmber’s Chief Commercial Officer, Babette Pettersen was cited as saying, “The bio-based technologies are playing out right now and pilot plants are being scaled up to commercial capacities – requiring hundreds of millions of dollars in investment. This is the so-called ‘valley of death’ for technology start-ups, which they have to traverse to become successful producers. It’s the Audis and P&G’s of this world that will pull demand through...”

“We need to find out whether our customers and our customers’ customers  have a need and interest and we need to play a role to pull things along the chain.”

She continues, “Venture capital and private equity have pulled back, public markets have closed and governments are not there to bridge the gap, except for a few countries like Canada and Malaysia.”

Pettersen explains that government support is required to create the right conditions for stimulating bio-industry interest and demand. “Governments need to step up and provide loans and other forms of funding assistance to help attract investment in commercial-scale projects that have proven they can economically convert agriculture into value-added products, reduce harmful emissions and create manufacturing jobs, especially in Europe.”

BioAmber’s commercial-scale, bio-based succinic acid unit being built in Sarnia, Ontario, Canada has received strong support and funding from the Canadian government and agencies including the Sustainable Development Technology Centre (SDTC), the Ontario Ministry Of Economic Development & Trade and the Federal Economic Development Agency for Southern Ontario.
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