Corny Problem for EU Sugar Producers

Corny Problem for EU Sugar Producers

Corny Problem for EU Sugar Industry

 

The abolition of sugar quotas in 2017 will have such a profound effect on EU sugar producers, used to super profits under the EU supported Common Agricultural Policy (CAP), that many smaller producers will be subject to consolidation or have to cease production. The problem will not be due to the increase in sugar production from EU countries that were subsidised for not producing during the quota period but due to a greater threat from a restricted sweetener that is up to 30% cheaper to produce.

 

In 2017 Isoglucose or high fructose corn syrup also known as glucose-fructose will have its quota restriction lifted within the EU. Isoglucose is mostly made from corn but can be made with wheat.

 

In the United State Isoglucose is used as a sweetener by up to 50% of the sweetener market. Japan uses it for 20% of their sweetener ingredients. Because of the quota the market share in the EU was only 5% in 2013.

 

It will not take much to see a rapid substitution of sugar for Isoglucose in soft drinks, bakery products, jellies, canned fruits and dairy products. This amounts to a realistic market transition of about 30% of industrial sugar consuming companies that now use sugar as a sweetener.

 

If Isoglucose were to reach such drastic adoption then it is likely that sugar surpluses will increase and EU sugar prices will come under extreme pressures. If tariffs stay in place, which is doubtful considering the recent agreement on TTIP trade between the US and EU, the EU farming community may survive, but only for a short time as Isoglucose produced within the EU from 2017 will eventually force substitution anyway.

 

Cereals prices remain under pressure from abundant world supply, slow demand and mostly good prospects for new crops. The cost of production of Isoglucose, net of raw materials is around $200 (€180) per ton leading to a finished price of $370 (€337) per ton. Compared to the current EU import price of sugar at $529 (€482) per ton, Isoglucose would represent a potentially large export market for US based ethanol producers.

 

Ultimately it will mean EU sugar producers who wish to keep market share will have to drop their prices by up to 30%.

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Integumen License Ageement

Today, Cellulac announces that it has signed Heads of Terms to enter into a commercial technology agreement with Integumen (LSE: SKIN). In addition, Integumen has conditionally agreed to acquire 9.35% of the issued shares of Cellulac. Gerard Brandon and Camillus...

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Big Oil Can’t Alter Climate Change

Big Oil Can’t Alter Climate Change

Big Oil Can't Alter Climate Change

 

In a recent major MIT Study (Covert, Thomas, Michael Greenstone, and Christopher R. Knittel. 2016. “Will We Ever Stop Using Fossil Fuels?” Journal of Economic Perspectives, 30(1): 117-38. ) it was shown that approximately 65 percent of global greenhouse gas emissions are generated by fossil fuel combustion. Of these emissions, coal is responsible for 45 percent, oil for 35 percent, and natural gas for 20 percent. The options to reduce greenhouse gases from the air and storing would require an expansion of the size of the world’s forests or build out carbon capture and storage infrastructure at a scale that will more than counterbalance the burning of fossil fuels. The other option is to reduce future consumption of fossil fuels in a drastic manner.

 

Oil, Oil Everywhere

 

Today the US crude oil inventory surplus is at a record high. Saudi Arabia and Iraq are pumping out more than 1.3 million extra barrels of oil per day than they were 12 months ago. Iran is commencing the production of 300,000 barrels that is expected to rise to 1 million barrels of oil per day. That leaves what lies in reserve in Libya until the turmoil is resolved. Finally the US in December 2015 shipped its first exported oil to France and Israel since the 70’s.

 

Russian security oil threat is a joke

 

Russia would not, nor could not hold Europe to ransom over energy supplies. The reality is that over the last 10 years Russian crude oil production has increased from 9 million barrels a day to 10,400 million barrels. Oil and gas comprise over 60% of Russia’s exports and make up over 30% of the country’s gross domestic product (GDP). Despite the dispute in Ukraine, Russia, just like Saudi Arabia, cannot afford to withhold oil or gas from any country without losing market share, unless the country happens to be Ukraine who owe Russia $3 billion for not having paid for their supply.

 

Emerging oil balance

 

Emerging markets such as India, China, Brazil and Russia will likely continue to consume more oil as they continue to grow, but the largest market in the world for consumption of crude oil for transport, the US, would reach an inflection point where renewable energy from wind and solar for electric vehicles, backed up by higher efficiencies of battery storage, would counter the oil demand for transportation in that market.

 

Taking a peak at a long term oil glut

 

That is another reason why oil could remain over supplied and below $40 per barrel for decades. The uptake in Electric vehicles will accelerate in the early 2020’s. Growing at 60% a year it is the same growth rate that saw Henry Ford and his Model T gain traction against the horse and buggy. In a Bloomberg report by Tom Randall he suggests that once the cost of batteries get low enough to match the costs of current production vehicles demand for oil will match any growth in world consumption outside of developed OECD countries.

 

A Solar Ray of Hope

 

While we boil the world away in barrels of oil there is a small ray of hope. Electricity is getting cleaner and cheaper. Since 2013, the world has been adding more electricity-generating capacity from wind and solar than from coal, natural gas, and oil combined. The move toward a cleaner grid, electric vehicles and renewable power does create a mutually beneficial circle of demand.

 

Micro capture is the only macro solution

 

Carbon capture on a large scale is expensive. For mankind to even begin to manage climate change we must achieve a similar result as John D. Rockefeller did at the outset of the oil industry when he converted useless oil into a commercially profitable solution. We must deliver a micro capture solution and incorporate carbon monoxide, carbon dioxide and methane capture systems into everyday fossil fuel consuming equipment. Preferably an alternative to a falsified emission output software application.

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Integumen License Ageement

Today, Cellulac announces that it has signed Heads of Terms to enter into a commercial technology agreement with Integumen (LSE: SKIN). In addition, Integumen has conditionally agreed to acquire 9.35% of the issued shares of Cellulac. Gerard Brandon and Camillus...

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Butterfly Effect of Oil Price on Renewables

Butterfly Effect of Oil Price on Renewables

Butterfly Effect of Oil Price on Renewables

 

The butterfly effect is a concept that small causes can have large effects. Initially, it was used with weather prediction but later the term became a metaphor used in and out of science. Now it can easily be related to a single decision made by a Saudi Oil Minister.

 

Parallel Oil Worlds

 

I read articles on the bioeconomy referring constantly to the “need” to replace fossil fuels, sometimes in amazement, wondering if there are two parallel worlds. I listened to Saudi Oil Minister, Ali Ibrahim Al-Naimi, telling the world that the freezing of oil production at January 2015 levels is merely part of a process. The objective is to force U.S. high cost shale oil producers to shut down, even if Saudi have to produce at $20 per barrel. His direct comment: “It sounds harsh, and unfortunately it is, but it is the most efficient way to rebalance markets”.

 

Henri Colens, Public Affairs Manager, Renewable Chemicals, at Braskem Europe, mentioned in an interview with Il Bioeconomista that “we all need to work harder on raising public awareness, so that citizens understand what we are doing and the potential of the bioeconomy”.

 

Oil Power beats Citizen Power

 

The power of citizens it seems are over shadowed by the flapping of an oil ministers wings when it comes to the biochemical and biofuel market.

 

 

Saudi Arabia, Russia, Qatar and Venezuela proposed a freeze that would cap production at January levels. The same day Iran called the proposal for a freeze ridiculous as they began their production of 1 million barrels per day. When the price of oil collapsed to below $50 a barrel in March of 2015, Saudi Arabia and Iraq began to increase production. Since February 2015 Iraq and Saudi have increased production over 1.3 million barrels per day.

 

Butterfly cascade after one decision

 

The cost of oil reduces the cost of refining to gasoline which in turn is blended with ethanol. When it drops so low that ethanol is more expensive than gasoline production, demand falls and high cost producers of ethanol suffer serious margin erosion. Citizens are happy as pump prices are lower, but the butterfly effect starts to hit more than shale oil.

 

Sovereign wealth funds who amassed wealth while oil prices were higher would have invested in growth of the world economy. Now many of them, including Saudi Arabia, Norway and other oil producers are dipping into their funds to balance their fiscal budgets. Russia being one that is suffering on a number of levels with economic sanctions and low oil prices. This leaves little discretionary investment funds for the bioeconomy who are still far from sustainable profitable businesses, leaving little support other than State or Federal supports.

 

So far from cellulosic ethanol

 

In 2010-2011 of the five biofuel companies who listed on NASDAQ today only one is still focused on fuel and constantly diluting their shareholders while others are searching for lower volume, higher value added, biochemicals. The search for cellulosic ethanol sees pilot plants such as Abengoa Hugoton achieving costs of $4.55 a gallon of ethanol. Considering the oil price no wonder this has been closed.

 

The point is that biofuel, or indeed the bioeconomy overall, requires that oil prices are much higher just to survive, both to compete on price, but also to have profits in the petrochemical companies available for investment in these alternatives.

 

Is Petro-Biofuel hybrid evolution enough?

 

There are a few hybrids. Braskem, as mentioned above, and Croda International PLC who posted a 10% increase in pre-tax profits where they use 70% renewables such as palm oil to produce ingredients for cosmetics and paint. Although in existence since 1925, they are a good example of how renewables are a work in progress over a timeframe that requires the patience of an evolution rather than the desperation of a revolution. The question is whether the citizens of planet earth have the time to evolve from the oil wars to survive the climate change.

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Integumen License Ageement

Today, Cellulac announces that it has signed Heads of Terms to enter into a commercial technology agreement with Integumen (LSE: SKIN). In addition, Integumen has conditionally agreed to acquire 9.35% of the issued shares of Cellulac. Gerard Brandon and Camillus...

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Cellulac Acquires Aer Sustainable Energy (Aer-Bio)

Cellulac Acquires Aer Sustainable Energy (Aer-Bio)

Cellulac Acquired Aer-Bio

10 fold saving in enzymes, 4 fold increase in algae oils within 2 hours reducing the process costs of Omega-3, animal feed and biofuels

 

Dublin, Ireland, 18th May 2015: Cellulac, the industrial biochemicals company, today announces the acquisition of Aer Sustainable Energy Limited, also known as Aer-Bio, effective 18th May 2015. The acquisition adds to the production capabilities in the bioplastic ingredients and biochemical sectors by adding foods, cosmetics, nutraceutical products and aviation biofuel to the core institutional knowledge of the Cellulac technology platform.

 

Aer-Bio+SoniqueFlo-Chart

 

The combination of the Cellulac SoniqueFlo technology – an environmentally-benign, low cost production of chemicals from bio-based dairy and agriculture feedstocks – and Aer-Bios’ accelerated enzyme-expression protocols, have delivered a revolutionary ‘wet extraction’ process for the extraction of oils, proteins and other value-added products from algae. Using a pilot scale SoniqueFlo rig, with the capability of processing up to 10 tonnes per hour, the results showed a 10 fold reduction in enzyme use and 4 fold increase in lipid/oils extraction from algae over a 2 hour period.

 

Gerard Brandon, CEO of Cellulac, commented;

 

“This is a major breakthrough because of the elimination of biomass drying steps that substantially reduce production costs of oil based products from Algae along with the removal of hazardous solvents for oil recovery. Aer-Bios’ contribution has been invaluable to Cellulac within our SPLASH (biopolymer) and FUEL4ME (biofuel) EU grant supported algae projects as the results show. We have industrial scale capability and are currently only limited by the supply constraints of Algae raw materials to process.”

Dr Alan Hernon Ph.D., CEO of Aer-Bio Limited;

“We are excited to have joined one of Europe’s fastest growing bio-based industry companies and believe that joining the Cellulac group offers our combined technologies greater opportunity to reach a wider global bio-economy audience.”

Background on Aer-Bio

 

AER BIO, Aer Sustainable Energy Limited, trading as Aer-Bio, is an Irish industrial biotechnology company. The company has developed an enzyme-based process delivering a revolutionary ‘wet’ extraction method for manufacturing bio-based oils, proteins and other valuable products from Algae. Products that can be extracted and refined using these methods include functional food products such as Omega-3 oils, personal care ingredients, industrial oils and aviation biofuels. Shareholders include Irelandia Investments, Tedcastle Oil, AIB-Seed Fund and Enterprise Ireland.

 

SoniqueFlo Test Rig – 10 tonnes per hour

 

SoniqueFlo Test Rig

SoniqueFlo Industry Scale Rig – 120 tonnes per hour

 

SoniqueFlo

This SoniqueFlo unit has built in 50% redundancy for continuous processing while one side is being cleaned or maintained.

 

Products Algae End Use Markets
Oils/Lipids
  • Algae oils can be a substitute for vegetable oil feedstocks (e.g. Palm, Soybean)
  • Refined glycerine produced for biodiesel may also be used in the pharmaceutical and consumer product industries (cosmetics, skin, beauty care, Omega-3)
  • Specialty oils and fatty acids for dietary supplements and other consumer care applications
Carbohydrates
  • Substitution of agricultural sourced feedstocks for conversion of carbohydrates (sugars) to bio-ethanol (e.g., corn, wheat, sugar cane and sugar beets)
  • Production of bio-based polyolefin plastics as biodegradable replacement of fossil fuel feedstocks
Proteins
  • There is a high protein content in algae biomass for the animal food market, replacing agricultural-based protein sources (e.g., soybean meal)
Hydrocarbons
  • Production of renewable fuel for substitution of diesel, ethanol and aviation fuels for commercial, industry and aviation sector
Biomass
  • Feedstock source for biomass power generation as a substitute for fossil fuels
  • Conversion of residual biomass following oil extraction to renewable distillates
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Integumen License Ageement

Today, Cellulac announces that it has signed Heads of Terms to enter into a commercial technology agreement with Integumen (LSE: SKIN). In addition, Integumen has conditionally agreed to acquire 9.35% of the issued shares of Cellulac. Gerard Brandon and Camillus...

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5 year, €35m Pharmafilter Partnership with Cellulac

5 year, €35m Pharmafilter Partnership with Cellulac

5 Year, €35m Pharmafilter Offtake Agreement for Bioplastic Ingredients

Partnership delivers 2nd generation bioplastics supply chain solution for hospitals

 

Dundalk, Ireland and Amsterdam, The Netherlands, 30th March 2015: Cellulac, the industrial biochemicals company, and Pharmafilter, a provider of integrated waste management infrastructure for dealing with complex waste, are delighted to announce a commercial partnership to deliver the first vertically integrated, supply chain solution for energy and wastewater recovery in hospitals.

 

main-tanks-corner52bda811c4a7f.jpgCellulac’s environmentally-benign, low-cost production bioplastic process uses 2nd generation dairy and agriculture feedstocks. Through this commercial partnership, cellulac will produce up to 90% of the core ingredients for disposable single-use items and personal hygiene products compatible with the Pharmafilter recovery system in hospitals. This partnership is a template for collaboration, development, and implementation of end-to-end solutions for advances in technology for the bio-economy.

 

Gerard Brandon, CEO of Cellulac

The Pharmafilter alliance with Cellulac is a classic definition of the bio-economy. Producing, at volume, our low-cost, thermostable and high strength bioplastics for a technology partner would be a significant development alone. However, it becomes transformative when combined with Pharmafilter’s hospital recovery system which is capable of recapturing energy and cleaning wastewater in a safe and environmentally friendly way. Our partnership creates a low cost, vertically integrated supply chain solution that has a low carbon footprint and is environmentally friendly, positioning both cellulac and Pharmafilter as lynchpins in a circular bio-based economy.

Eduardo Van Den Berg Founder and CEO of

 

Our innovative solution solves waste, wastewater and safety problem for hospitals by removing complex waste, sewage and wastewater streams emanating from hospitals. Central to this solution is the requirement to secure a sustainable low cost and low carbon, high energy, end-of-life solution for single use bioplastics. cellulac’s innovative production and operational cost base opens the door for Pharmafilter to meet those targets and we look forward to rolling out the products over the next few years.

 


About Pharmafilter BV

Pharmafilter

Pharmafilter represents a change that positively enhances the work environment, patient safety, and care. It is an environmentally friendly way of dealing with the complex waste, sewage and wastewater streams emanating from hospitals that would normally be contaminated with high concentrations of pharmaceuticals, such as antibiotics, painkillers, toxic substances, heart medicines and contrast media. Through urine and feces, these substances are discharged to the wastewater system and despite excellent biological treatment in wastewater treatment plants, eventually discharged into surface water.

 

Logistically and historically, waste in hospitals is removed and separated into various categories. This activity requires both significant staffing hours, physical infrastructure and recording of waste types. This process requires the use of sorting rooms, internal, external storage and transporting waste through public corridors and lifts. The core benefits are:

 

  1. The on-site plant produces its own electricity and recovers the water to the quality that can be reused in the hospital. It reduces mixed waste (including hazardous) by 50% of the volume including 90% of organic waste representing another cost benefit.
  2. It is a thoroughly integrated waste management system that delivers significant improvement in the handling, removal, and treatment of waste streams arising in hospitals, at every user interface. These include solid waste in the form of bioplastic bedpans, urinals, kitchen refuse, general waste and health care risk waste.
  3. Pharmafilter system greatly simplifies the methods by which waste is handled and decontaminated and, therefore, reduces overall costs.

Pharmafilter Process

 

Starting inside the hospitals individual shredding units (“Tonto”) are installed in service or utility rooms convenient to areas of waste output.

 

Steps:

 

  1. All waste generated in the department and ward from healthcare risk waste, food, sharps, materials contaminated with blood, soiled, pharmaceuticals, paper, plastics, biodegradable bedpans and urine collection units are shredded in the Tonto unit.
  2. Waste now exits the hospital through waste disposal pipes that are now redirected to the Pharmafilter on-site unit rather than the external sewer.
  3. Here the Pharmafilter unit automatically decontaminates and separates all constituents of this mixed waste stream; sewage, organics and water resulting in outputs free of viruses, pathogens harmful bacteria, pharmaceuticals and other trace contaminants.
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Integumen License Ageement

Today, Cellulac announces that it has signed Heads of Terms to enter into a commercial technology agreement with Integumen (LSE: SKIN). In addition, Integumen has conditionally agreed to acquire 9.35% of the issued shares of Cellulac. Gerard Brandon and Camillus...

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