The Past

In the 1920s, we moved away from an industrial economy based on living plants and toward an industrial economy based on dead, fossilized plant matter. These fossil fuels became the foundation of our modern chemical engineering industry. Before World War I an increasing number of chemicals were derived from coal. After 1920 petroleum increasingly became the fossil fuel of choice. The remarkable increase in the demand for gasoline spurred engineers to design new ways of separating out the different components of crude oil. Huge refineries "cracked" crude oil to extract larger quantities of gasoline. The process generated large quantities of other gaseous and liquid by-products which soon became the basis for a new category of synthetics: petrochemicals.

After World War II, petrochemicals began to dominate the synthetics market. By 1990, for every industrial product except paper, petroleum had replaced starch, vegetable oil, and cellulose, the three primary components of plant matter that served as the feedstocks for the early industrial era.

Today, 65 percent of our clothing is made from oil. Virtually all of our inks, paints, dyes, pharmaceuticals, plastics, and hundreds of intermediate chemicals are made from oil. The production of petroleum based plastics alone has expanded by more than 400 percent in the last two decades, to 30 million tons in 1990. Plastics are replacing glass, metals and paper in an ever expanding variety of products. Petroleum based products have even entered the food chain, with petrochemical based food dyes and, in some cases, petroleum derived vinegar.

As we can see from Table I, aside from papermaking, only 6 million tons of plant matter consumed in the U.S. are used for industrial purposes. In 1989, 172 million tons of fossil fuels were used for making industrial products(excluding construction products like asphalt). Petrochemicals, in turn, are used to make tens of thousands of final products.

The Present

The 20th century has been the age of the hydrocarbon. The 21st century should witness a rebirth of a carbohydrate economy. Living plants are again becoming attractive raw materials for manufacturers. The signs may be modest, but the conclusion is unmistakable. The pendulum is swinging back to a biological economy.

Recent technological advances in biological processing techniques allow manufacturers to separate out the different component parts of plant matter as easily as they separate out the different components of crude oil and to manufacture these into products with properties similar to those derived from fossil fuels.

Molecular sieves have dramatically lowered the cost of separating liquids. Advanced pyrolysis processes, that is, burning with low or zero levels of oxygen, have lowered the cost of generating and separating out gases and liquids from solids like wood.

One of the most dramatic and far reaching advances has been in our ability to produce enzymes. Biological processes increasingly rely on infinitesimal living factories, or microbes, which rely on enzymes to do their work. Enzymes are large protein molecules that dramatically speed up the process of splitting apart and stitching together molecules. Until recently the high cost of enzymes restricted their use to the manufacture of high priced products, like pharmaceuticals. Naturally occurring microbial cells of fungi, yeast and bacteria produce small quantities of enzymes at very slow rates. Traditional techniques to isolate and purify enzymes have been very expensive and capable of producing only low grade(less active) enzymes.

In the 1980s, genetic engineering dramatically increased the activity levels and capacities of enzymes. Ultra-centrifuges and chromatography techniques, combined with improvements in protein separation, helped reduce the processing cost. The result is that the cost of enzymes has dropped by more than 75 percent in the last 10 years. Enzymes have entered the broad industrial market. One of the first such markets has been for detergents. Today almost 50 percent of all U.S. detergents contain enzymes.(The market share for enzyme based detergents is over 90 percent in Europe and Japan.)

Breakthroughs in the manufacturing process are not the only way to reduce price. Sometimes breakthroughs in plant yield make plant matter the preferred industrial raw material. For example, natural red dyes for food applications have been about 400 percent more expensive than petrochemical derived red dyes for the same purpose. In 1992 Aunt Nellie's Country Kitchen bred a superbeet with coloring yields per acre some 600 percent higher than ordinary beets. Currently it would require $45 of beet dye to achieve the same effects as $13.60 worth of petroleum derived red dye No. 40. The new beet can potentially reduce the natural dye to $10 per pound.

While technological advances are lowering the cost of plant matter derived products, environmental regulations are raising the cost of making and using petroleum based products. State and federal regulations have spurred the entry of many bioproducts into the marketplace. About one quarter of the states in the U.S. ban phosphates in detergents, a regulation that has paved the way for a dramatic expansion in the use of enzymes. Several states have enacted legislation that encourages the use of degradable plastics for various uses, opening up markets for bio-plastics. Cities with dirty air are limiting the amount of evaporative emissions from petroleum products. The result is to encourage the substitution of vegetable oils for mineral oils in a wide variety of products like paints and inks and barbecue lighter fluids.

In many cases, environmental regulations allow plant matter derived products to compete even when their price is higher than petroleum derived products. Even when environmental regulations do not exist and the prices of bio-products are higher than their petroleum based counterparts, many consumers are willing to pay a "green" premium for them.

Ten years ago, aside from some intermediate chemicals and adhesives, there were virtually no plant derived industrial products. Today bio-paints have captured about three percent of the paint market. Vegetable oil based inks have six percent of the printing ink market. More than 10 percent of the detergents on the market are primarily plant matter based. About five percent of commodity plastics contain some amount of plant matter.

Some plastic bottles now are derived from a plastic manufactured by a bacteria whose food is sugar. The colored ink sections of your local paper will more often than not contain vegetable oils, not mineral oil. Barbecue fluid may contain grain derived ethanol. Shampoo may contain vegetable oils and flower fragrances.

The Benefits of a Biological Economy

A biological economy must be based on sustainable cultivation and harvesting practices. The increased consumption of renewable materials must be matched by an increased commitment to agricultural techniques that preserve and enhance the quality of the soil.

Virtually all our non-energy, industrial product needs can be satisfied without expanding agricultural production. In fact, sufficient agricultural wastes exist to provide enough raw material to displace almost all petrochemicals. Substituting biochemicals for petro-chemicals thus not only substitutes renewable materials for non-renewable materials but also finds uses for previously discarded materials.

Approximately 350 million tons of agricultural waste is currently disposed of each year. This includes wastes generated at processing facilities, such as corn cobs from corn mills, sawdust from lumber mills, spent liquor from paper mills, lawn clippings from municipal yard waste pickups and excludes wastes left on the fields. Since this waste material has already been collected and centralized, it is a straightforward process to convert it into more valuable products as markets develop.

• About two dozen large pulp and paper mills in the U.S., for example, use a sulfite pulping process. Only 50 percent of the wood is converted into pulp. The remaining 50 percent, consisting mainly of the hemicellulose and lignin components of wood, is dissolved in "cooking liquor". This liquid, called "spent liquor" or "sulfite liquor" contains small proportions of many materials. Spent liquors are usually evaporated and burned. The inorganic compounds, that is, non-carbon, earth derived materials, like silicates are recovered and reused. The condensates from evaporation, which contain low concentrations of organic acids, primarily acetic acid, are generally discharged into nearby waterways.

  Several states require treatment of this waste stream to reduce biochemical oxygen demand as a way to protect the quality of streams and rivers. As a consequence several sulfite mills are considering recovering acetic acid from the condensates or switching to coal as their boiler fuel and using the entire sulfite stream for organic chemicals recovery.

  The 61 million tons of waste liquor generated each year could yield 2.2 million tons of acetic acid from condensates alone, if the spent liquor continued to be burned. Acetic acid is used in the manufacture of familiar products like vinegar and toothpaste and in less familiar processes like plastics manufacture and even as a quenching agent in the hardening of steel. It is derived from petrochemical feedstocks and has annual sales of 1.9 million tons.

• The case of sawdust and activated carbon is similar. Activated carbon and a more refined version of the charcoal, carbon black are used in inks or toners for copiers and laser printers, in wastewater treatment systems and in industrial processes. In 1990, 6.5 million tons of activated carbon were sold. Over 85 percent was derived from petrochemicals, primarily from natural gas and coal. Advanced pyrolysis techniques may be able to produce activated carbon and carbon black from sawdust for 30-45 cents per pound compared to 50 cents to $l per pound for carbon black derived from natural gas. The 7 million tons of waste sawdust at the nation's lumber mills could yield over 1 million tons of carbon black, in addition to 800 million gallons of fuel oil that could substitute for diesel fuel. In 1993 a plant that will make several products from sawdust, including activated carbon, will become operational in upstate New York.

• The case of fast food cooking oils and glycerol is still another example of converting waste to wealth. Glycerol is used in food and beverage products and in the manufacture of lubricants, electronics, rubber, cosmetics and explosives. The glycerol market is 200,000 tons per year. Today almost all glycerol is made from petroleum. Vegetable oils contain about 10-15 percent glycerol by weight. Twelve pounds of vegetable oil yields 1 pound of glycerol. The 2.7 million tons of waste cooking oils, primarily from fast food restaurants, could yield about 200,000 tons of glycerol. In 1992 the vegetable oil industry began to produce a diesel fuel equivalent from vegetable oils. In the production process, glycerol is produced. As the market for biodiesel expands, so will the production of bio-glycerol. Bioproducts tend to earn high marks for their relatively low environmental impact. Vegetable oils do not produce harmful evaporative emissions. Plastics derived from high proportions of starch are completely degradable. Enzyme based detergents also readily degrade, thus avoiding the upgrading of wastewater treatment plants required to treat phosphates.

The processing of plant matter into final products can rely on chemicals or biological processes or a combination of both. If chemical processing is used, then plant matter based manufacturing may be nearly as environmentally harmful as fossil fuel based manufacturing. The pyrolysis process, which breaks down plant matter into gases and liquid components, generates no harmful wastes. And biological processing based on enzymatic actions and micro organisms takes place at low temperatures and pressures with the wastes becoming food for other parts of the natural environment. A shift to biochemicals promises economic as well as environmental benefits. Opening up industrial markets for plant matter will raise the value of plant matter and thus farm income.

However, the greatest gain to farmers and the biggest potential for economic development in rural areas will occur if the intermediate processing of the plant matter occurs locally and if the processing facility is cooperatively owned. Plant matter, unlike petroleum, is bulky and expensive to transport and thus biochemical refineries will be smaller and closer to their raw material source than petrochemical refineries. This encourages local and regional processing. The agricultural sector, unlike the industrial sector, has a long and rich tradition of cooperative ownership. Although the majority of cooperatives are service and marketing coops, several hundred processing and production cooperatives exist as well.

A Status Report on Bioproducts

In many cases a plant matter derived product enters the market by displacing a portion of the petroleum derived product and then gradually increases its proportion. For example, in the late 1980s plastic manufacturers introduced products containing 6 percent starch. In 1993 some plastics contain over 85 percent starch. In the paint market, vegetable oils began by replacing the mineral oils and, more recently, biopigments have been added.

Plant matter derived products also often enter a small portion of a product market and then, as their properties improve, expand their market share. Soy oil inks first entered the U.S. market in 1987. Today 50 percent of the 9,100 newspapers in the U.S. and 75 percent of the 1,700 daily newspapers print with soy ink. Soy oil is the oil of choice for colored inks, where the pigment rather than the price of the oil is the basis for the selling price but it is making inroads into the black ink market even though its price is about 10-20 percent higher. Aside from price, the key obstacle to the introduction of vegetable oil based inks has been their slow drying time. This poses few problems in the newspaper printing process but in magazine and other types of printing it does. Soy oil ink manufacturers are rapidly improving their inks to be able to expand into these other printing markets.

ILSR compared the price of bioproducts and petrochemical based products in 15 product categories representing over 90 million of the 108 million ton commodity petrochemical market. The results are contained in Table III.

In this table, the market share of plant matter includes products that are wholly or partially composed of plant matter.

As we can see, plant matter has been making inroads into every product category. In all cases, the prices of bio-products have dropped over the past seven years. The cost of pigments from plant matter has declined by 20 percent. The cost of inks has dropped by over 30 percent. Most plant matter derived consumer products are not yet competitive with their petrochemical counterparts, but the price premium has dramatically diminished. As mentioned above, even when their costs are higher plant matter based products are gaining market share as a result of a combination of green consumerism and government regulation.

Plant matter derived products have established their reliability and quality and environmental value. The cost of bioproducts should continue to drop and their market share should expand. We project the cost of plant matter based products to decline in the 1990s, although at a somewhat slower pace than occurred in the 1980s. The major exception is plastics, where dramatic cost reductions are likely in the next few years. In some cases, we project five year growth rates exceeding 100 percent. In most cases, projected growth is a more modest but still respectable 10-20 percent.

As Table IV reveals, by 1996, the amount of plant matter used in making industrial materials, excluding paper and natural rubber, could increase by over 5 million tons. This would almost double the amount of plant matter used for industrial purposes from their 1990 levels. Detergents and plastics will account for one third of the projected market expansion.

Conclusion

This interplay of public regulation, consumer sophistication, and private entrepreneurship has brought plant matter derived products into almost every major product category. The groundwork has been laid for a resurgent carbohydrate economy. But much remains to be done.

There seems little question that the carbohydrate economy will expand. But questions still remain as to how fast and to what extent it will expand. Sufficient agricultural wastes exist to displace a large portion of our biochemicals. Biochemical refineries can breathe new life into rural economies.

Yet this will not happen inevitably. The initial revival of a carbohydrate economy has occurred as an unexpected result of public policies devised for other purposes. It is time to elaborate public policies with the specific goal of creating sustainable, prosperous rural economies.