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Nnfcc market review feedstocks issue twentyfive april 2014

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A round up of news in the feedstock sector

A round up of news in the feedstock sector

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  • 1. Welcome to the April 2014 issue of our feedstocks market review! Each month we review the latest news from across the feedstocks market. This service is exclusively for NNFCC members. Contents Land use & Sustainability........................3 Market.............................................................4 Research & Development .......................6 Wood & Crop...............................................7 Residues & Wastes ..................................10 Events ............................................................11 Feedstock Prices........................................13 Issue Twenty Five April 2014 Issue Twenty Five April 2014 NNFCC Market Review | Feedstocks
  • 2. NNFCC Market Review, April 2014, Page 2 of 14 Foreword Welcome to the April 2014 issue of our Feedstocks market review! This month’s news is full of solid biofuels success stories. The wood pellet production industry in the US is growing at an unprecedented rate. The US industry is planning a pelleting capacity expansion of 25%, to its current 13 million metric tonnes capacity. Major developers are typically existing players like Fram Renewable Fuel LLC, Enviva LP, German Pellets GmbH, Zilkha Biomass Energy, and Drax Biomass. According to a new report from Pöyry management-consulting, the current global market volume for biomass pellets is around 16 million metric tons and is projected increase to 46 million by 2020. Underpinning the soaring market expansion of solid biofuels, tools and mechanisms to satisfy sustainability criteria and quality assurance are gradually being set in place. According to the new IPCC report, to attain climate change resilience in a growing bioeconomy world, development has to be delivered taking consideration of environmental and social sustainability. A key imperative to this is setting up of ambitious goals and taking measures to secure sustainability during transition from an oil to a bio-based economy. In support of this ambition, a new wood fuel report from industrial stakeholders in the UK identified that wood pellets supplied through a high quality supply chain significantly exceed DECC’s requirement for 60% reduction in GHG’s. The International Organization for Standardisation (ISO) is developing a new fuel standard for solid thermally-treated biomass. The new standard designated ISO 17225-8 will define the fuel quality classes and specifications of graded and densified solid biofuels produced from thermally treated biomass (torrefaction). Read on for the latest market news.
  • 3. NNFCC Market Review, April 2014, Page 3 of 14 Land use & Sustainability Industry research into sustainability of UK pellets Renewable energy from wood fuel has major potential as a sustainable and efficient way to produce heat which can be used to warm homes and businesses, provide hot water and drive industrial processes. However, the benefits accrued from utilising wood fuel for this purpose depend on the sustainability of the source and emissions accruing from land-use production, harvesting, transportation and conversion. An industry-funded briefing "Delivering the UK’s renewable heat objectives through wood fuel" sets out the position of some of the UK’s leading pellet manufacturers, distributors and suppliers of wood pellet boilers for heating on the issue of sustainability. It provides data obtained from current production and distribution within the UK wood pellet industry and emissions of CO₂ from every stage of the supply chain are analysed. The authors have sought to illustrate the journey and emissions from supplying biomass pellets typically available in the UK, to provide insight into a real journey from forest to radiator. The results show that wood pellets supplied through a high quality supply chain significantly exceed DECC’s requirement for 60% reduction in GHG’s. Click here for more information. RSB launches simplified certification process for Bonsucro certified entities The Roundtable on Sustainable Biomaterials (RSB) is pleased to announce that Bonsucro certified operators will now be able to access RSB certification through a simplified audit process to demonstrate compliance, therefore saving costs and time. A released RSB study concludes that RSB and Bonsucro sustainability standards have significant overlap on most of their requirements. Supported by the ISEAL Alliance, the comparison reveals that Bonsucro certified sugarcane could be de facto considered compliant with most of the RSB's twelve Principles and Criteria. RSB has additional requirements for Rural and Social Development and Food Security. This collaboration between RSB and Bonsucro will enhance the development of advanced biomaterial pathways by increasing the supply of sustainable sugar products and ethanol material to biofuel and bioenergy producers.
  • 4. NNFCC Market Review, April 2014, Page 4 of 14 Click here for more information. Market New standard in development for thermally treated biomass pellets The American Society of Agricultural and Biological Engineers has announced that the international community has approved a new International Organization for Standardization project to develop a standard for thermally treated and densified biomass fuels. The document, designated ISO 17225-8 will define the fuel quality classes and specifications of graded, densified, solid biofuels produced from thermally treated biomass. It will cover pellets and briquettes from various raw materials and will apply to fuels intended for either industrial or non-industrial use. This project is currently at the working draft (WD) stage. ASABE is accredited by the American National Standards Institute as the administrator for the U.S. technical advisory group to the ISO committee on solid biofuels, TC 238, which was established in response to growing global trade in the subject commodities. Click here for more information. Global Pellet Demand Rises Source: CanadianBiomassMag In the next eight years, significant growth is predicted in wood fuel pellet markets worldwide. Europe will continue as the largest source of demand, with markets also emerging in Asia. Growth in production will continue in North America, but new production is being established in nearly all wood fibre baskets worldwide. In addition, pellets produced from agricultural products and through innovative processes such as torrefaction may also emerge to some degree. The fact is that no region or technology remains the obvious leader for prudent investment decisions. With growth nearly tripling by 2020, each region and technology has its own unique pros and cons. The current global market volume of biomass pellets of around 16 million metric tons annually (mt/a) is projected by Pöyry to increase to 46 million mt/a by 2020, representing a total market value of up to $8 billion U.S. The adoption of biomass fuel pellets is largely driven by policy and financial incentives in much of the world, and this will continue to be the case. However, this reliance on traditionally unpredictable policy incentives adds a level of uncertainty. Increasing influence from fossil fuel prices will also play a larger role in the future. Click here for more information.
  • 5. NNFCC Market Review, April 2014, Page 5 of 14 A giant step for pellet production As Fram completes each of five production lines, the Port of Brunswick stands ready with a recently deepened shipping channel that allows larger bulk vessels to berth and accommodate the port; Source: BiomassMag More than 4 million metric tons of new wood pellet production capacity are currently under construction throughout North America, over 3 million tons of which are scheduled to come on line this year, and 600,000 tons in spring 2014. Such capacity growth is unprecedented in the North American pellet industry, which is comprised of some 160 facilities, with a total installed capacity of around 13 million metric tons. Not only will the capacity added this year grow the industry’s output by nearly 25 percent in just one year, but facilities scheduled to come on line in 2015 will bring the two-year expansion closer to 33 percent. Growth in the pellet sector is largely coming from the construction of a much smaller fleet of supersized plants. Whereas the average installed capacity in the pellet industry’s existing 159 operational plants is under 80,000 tons per year, the planned capacity at the production facilities scheduled to come on line in the next two years is 350,000-plus metric tons per year. Click here for more information. Tightening in US domestic pellet supply after cold winter US Pellet retailers and consumers in some Northeast and Midwest locations have learned a lesson this heating season, as many have run out of pellets and are facing difficulties securing additional supplies. The general consensus amongst pellet producers on what, exactly, that lesson should be is that ordering or buying pellets too late in the season leads to inaccurate demand estimates. Cory Schrock, plant manager of White Pigeon, Michigan-based Fiber By-Products, said: “Most producers aren’t operating at full capacity, but that’s because they aim to supply what the market demands.” “Producers have an average operating capacity of 50 to 60 percent, because that is all the market requests of us. Couple that with one of the coldest and hardest winters on record so consumer usage is up, and skyrocketing propane prices, and consumers have turned to wood pellets.” Click here for more information. Novozymes launches LpHera, an enzyme to make starch conversion more efficient Novozymes headquarters; Source: IlBioeconomista
  • 6. NNFCC Market Review, April 2014, Page 6 of 14 Novozymes – the Danish biotech company which is world leader in industrial enzymes - announced yesterday the launch of a new enzyme solution (LpHera) that helps make starch conversion more efficient. The starch industry is one of the longest- standing markets for enzymes, and within the food industry helps to produce a wide range of sweeteners and ingredients used in products ranging from soft drinks to sauces. Thomas Nilsson, Global Launch Manager for food at Novozymes says: “Customers have been asking for new ways to make starch conversion more efficient. LpHera simplifies the process and offers significant savings to starch processors.” “Through boosting yields, cutting chemical usage in half and facilitating water and energy savings, LpHera saves a starch processor up to 1 USD per metric ton of substrate. Starch plants vary in size and can process from 0.2 to over 1 million ton of substrate each year. So if a plant process 0.5 million ton of substrate, they can so save up to 0.5 million dollars per year compared to today’s technology.” Click here for more information. Research & Development Ensiling as biological pretreatment of grass (Festulolium Hykor): The effect of composition, dry matter, and inocula on cellulose convertibility Total organic acids vs.DM, for four cuts; Source: Elsevier Grass biomass is a prospective type of lignocellulosic biomass for bioenergy and fuel production, but the low dry matter in grass at harvest calls for new pretreatment strategies for cellulosic conversion. In this published peer- reviewed article from Denmark, ensiling was tested as a biological pretreatment method of the high yielding grass variety Festulolium Hykor. The biomass was harvested in four cuts over a growing season. Three important factors of ensiling: biomass composition, dry matter (DM) at ensiling, and inoculation of lactic acid bacteria, were assessed in relation to subsequent enzymatic cellulose hydrolysis. The organic acid profile after ensiling was dependant on the composition of the grass and the DM, rather than on the inocula. High levels of organic acids, notably lactic acid, produced during ensiling improved enzymatic cellulose convertibility in the grass biomass. Ensiling of less mature grass gave higher convertibility. Low DM at ensiling (<25%) resulted in the highest cellulose convertibilities, which ranged from 32 to 70% of the available cellulose in the four cuts after ensiling. The study confirms that ensiling can enhance cellulose convertibility of green biomass, and provides new insight to ensiling as a biological pretreatment method for green biomass conversion.
  • 7. NNFCC Market Review, April 2014, Page 7 of 14 Click here for more information. Wood & Crop Forth Energy pulls out of Scottish biomass projects The planned biomass plant in Dundee had attracted controversy; Source: BBC Forth Energy said it was not continuing with renewable energy projects in Grangemouth and Rosyth and was seeking new backers for the schemes. The plans for a plant in Dundee have also been withdrawn altogether. The news came after key backer Scottish and Southern Energy (SSE) announced it was pulling back from renewable energy projects. Forth Energy, a joint venture between Perth-based energy giant SSE and Forth Ports, had won consent from the Scottish government for the wood-burning biomass plants in Grangemouth and Rosyth. However, the Dundee proposal, which carried a similar price tag, had been held up by a government inquiry after plans were rejected by the local city council. Click here for more information. UK power generator Drax aims to hit 50% biomass output by 2016 Drax produced almost 3 TWh of electricity from biomass in 2013 and aims to increase this to half of all its electricity output by 2016, the 4 GW coal- fired generator said Tuesday in an annual results statement. The company produced a total of 26.2 TWh in 2013, down from 27.1 TWh in 2012. Availability in its coal-fired generation operation fell to 84% from 86%, while availability in its biomass operation reached 88%. Good progress was reported on optimization of Drax' first converted biomass unit, which the generator expects to achieve output of 630-MW, with efficiency "only 0.5% less than coal," it said-- considerably better than expected. "Our overall target is to achieve a capacity of 645- MW using standard woody biomass," it said. "We have already demonstrated that we can achieve this higher output under special conditions when using particularly high calorific sustainable wood pellets." Click here for more information. Laundry liquid set to be the first of a range of products to use algal oil, in a move designed to reduce demand for controversial palm oil Source: Ecover
  • 8. NNFCC Market Review, April 2014, Page 8 of 14 Ecover has developed the first laundry liquid in the world to use oil sourced from algae as an alternative to palm oil, demand for which has widely blamed for rainforest clearances and the loss of crucial habitats. The liquid, set to be available from August, is to be the first of a range of products that Ecover says will help reduce dependence on palm and palm kernel oil by replacing it with innovative new natural oils produced from algae. The company has already replaced palm oil surfactants in its cleaning range with European- sourced rapeseed alternatives and uses 100 per cent sustainably certified palm oil in those products where palm oil is still used. However, even sustainably certified palm oil has been criticised by some environmental groups, who claim that palm oil plantations around the world are continuing to indirectly drive deforestation, leading to increased greenhouse has emissions and habitat loss. Ecover said that using algal oil instead of palm oil safeguards biodiversity and, because it can be produced locally, results in lower CO2 emissions and improved supply chain transparency. Click here for more information. Valensa supplier launches major expansion of natural astaxanthin biomass capacity A covered greenhouse facility with runways for cultivation of microalgae; Source: Contract Biotics Valensa International and Contract Biotics have announced that Contract Biotics has started construction of an additional six acres of algae production units at the company's San Diego County facility. Slated to come on-line in the fall of this year, the expansion will more than triple Contract Biotics' current biomass production and thus play a crucial role in helping Valensa meet the market demand for its line of formulated, condition-specific Astaxanthin-based products. Contract Biotics is a U.S. based wholesale producer of a wide variety of high quality algae biomass. The California facility is unique because it employs a hybrid greenhouse technology to protect the production ponds from outside contamination unlike other producers who employ "open" ponds. The use of U.S.-sourced biomass combined with its Florida-based organic certified extraction facilities makes Valensa the only "Made in America" Astaxanthin supplier on the market today. As one of the most powerful known fat-soluble antioxidants, Astaxanthin has long been recognized for its ability to protect against cell damage caused by oxidative stress. Click here for more information. Solvay launches production of torrefied biomass, a new solution that contributes to energy transition Solvay has launched the production of torrefied biomass at an industrial scale in the United States, creating a new business that aims to provide an
  • 9. NNFCC Market Review, April 2014, Page 9 of 14 innovative and renewable energy solution. This business will be run by the recently created Solvay Biomass Energy joint venture between Solvay and U.S. company New Biomass Energy (NBE). Torrefied biomass is produced in Quitman, Mississippi at a plant that was built and developed by NBE. Solvay will provide its industrial expertise to more than triple annual production capacity to 250,000 tons by the end of 2014 from 80,000 tons currently. Solvay Biomass Energy will use by- products, such as sawmill residues, from the highly developed timber industry in the area’s managed forests. Solvay Biomass Energy, majority-owned by Solvay’s business unit Solvay Energy Services, is in charge of the plant’s operations and maintenance, feedstock sourcing, logistics and technology as well as of the product’s marketing mainly to energy producers in Europe and Asia. Click here for more information. Vega Biofuels enters joint venture to build torrefaction facility Source: BiomassMag Vega Biofuels Inc. recently announced it has entered into a joint venture agreement to build and operate a pilot torrefaction facility in South Carolina that will manufacture the company's bio- coal and biochar products. Vega Biofuels and its partners, including Agri-Tech Producers LLC, are building the state of the art facility in Allendale, S.C. The new joint venture entity will operate under the name ATP-SC LLC and will produce various torrefied products. The joint venture partners plan to build additional plants around the world and the Allendale pilot plant will be a model for those plants. Columbia, S.C.-based ATP is in the business of manufacturing and selling cost-effective torrefaction equipment to be used to manufacture torrefied materials and solid fuel. ATP has licensed and commercialized the innovative torrefaction technology originally developed by North Carolina State University. Click here for more information. Scale test of Giant King Grass grinding equipment for Nicaragua Power Plant VIASPACE has conducted a full production scale test of Giant King Grass grinding equipment in Portland, Oregon. 6,000 pounds of 18 foot tall Giant King Grass stalks were cut and shredded in a few minutes in a test of a candidate grinder for the power plant being developed in Nicaragua. VIASPACE CEO Dr. Carl Kukkonen reported: "An electrically powered grinder is lower cost and has lower maintenance than a diesel powered grinder. We plan to install the grinder in our fuel processing and short-term storage facility just outside the power plant. Since it is a stationary and large machine, the only way to test it was to bring the Giant King Grass to the grinder. That is what we did. Our production needs are 36 tons per hour, 24 hours per day, and 365 days per year." Click here for more information.
  • 10. NNFCC Market Review, April 2014, Page 10 of 14 Residues & Wastes Waste-based biofuels sector needs smarter EU 2030 package to realize its high potential Report cover; Source: EuropeanClimate UPM participated together with a coalition of technology innovators and green NGOs in a project for which results have recently been published. Europe has a significant untapped potential for converting wastes from farming, forestry, industry and households to advanced low-carbon biofuels, but only if it sets a strong sustainability framework and ambitious decarbonisation targets for transport fuels in 2030, finds a new report entitled “Wasted: Europe’s Untapped Resource.” The project found that if all sustainable waste from farms, forests, households and industry were used for transport fuels, there could be sufficient fuel to displace about 37 million tonnes of oil annually by 2030. To put this in context, this technical potential would be equal to 16 per cent of road transport fuel demand in 2030. David Turley of NNFCC, who led the economic analysis, said: “Our analysis indicates that once deployed at scale, advanced biofuels from agricultural and forest residue feedstocks would require little or only a modest additional incentive to stimulate production at prices comparable to that of current crop-fuelled technologies.” Click here for more information. Veolia proposes 20MWth EfW CHP plant in Hertfordshire UK Veolia, the UK’s leading waste management company, already operate two important CHP facilities in Sheffield and in London and its proposed facility in Hertfordshire, which is awaiting planning approval, could provide a further 20MWth of heat – enough for 60,000 MWh per year to heat the equivalent of 4,000 local homes. If approved, the proposed Recycling and Energy Recovery Facility (RERF) in Hertfordshire will generate sufficient power to the National Grid through the energy recovery process to power around 50,000 Hertfordshire homes and save the local authority around £667 million, but while it is delayed those savings are being lost, waste continues to be sent to disposal or recovery facilities outside the county and we are unable to use the waste as a source to heat local homes. Click here for more information. French biomass group Albioma to open more biogas plants Source: Albioma
  • 11. NNFCC Market Review, April 2014, Page 11 of 14 The company specialises in generating electricity from sugarcane waste in France's overseas territories. It has opened two biogas plants in the region around Poitiers in 2013 and plans to open three or four more this year, of which one will inject purefied methane into the French gas network. Albioma has a pipeline of 22 methanisation plants, in which it will invest about 200 million euros in coming years. The plants will use manure, agriculture waste and slaughterhouse waste and will be built in France's western and northwestern agricultural regions. The first two plants have capacities of 2 and 0.5 megawatt respectively. Click here for more information. The year is here for cellulosic ethanol industry T Abengoa went the extra mile to ensure area farmers know how to avoid overharvesting corn stover, the feedstock for its Hugoton cellulosic ethanol plant in US. Source: BiomassMag Those in the cellulosic ethanol industry know “five more years down the road” as a phrase that’s been associated with commercial-scale cellulosic ethanol production for a very long time. With the close of 2013, it’s safe to say that timeline is no longer relevant, as the time has finally come. In the advanced biofuels arena, no cellulosic ethanol projects have been watched more closely than those being built by Poet-DSM Advanced Biofuels, Abengoa Bioenergy and DuPont Industrial Biosciences. Together, these three cellulosic ethanol plants rise from the plains and fields, acting as beacons to the advanced biofuel industry that is just pulling its ship to shore. One of the most daunting tasks in bringing a cellulosic facility on line might not be so much the technology and equipment challenges, but the procurement of feedstock. Christopher Standlee, executive vice president at Abengoa Bioenergy says: “We’ve built numerous ethanol plants of our own and we know what the construction process is like.” “We know our technology works, we’re comfortable with our ability to handle the product once it’s there, but one of the biggest challenges is the massive amounts of feedstocks that you have to deal with.” Click here for more information. Events LCA Workshops on 29-30 April in York, UK Following the success of our previous Life Cycle Assessment (LCA) workshops, NNFCC and North Energy bring you two new training workshops providing you with insight into how LCA's work and their applications. The workshops take place over two days;
  • 12. NNFCC Market Review, April 2014, Page 12 of 14  Day 1: 29 April 2014. Introduction to LCA Workshop  Day 2: 30 April 2014. Advanced LCA Workshop. Seaweed for Biofuel on 21 May in Oban, Scotland Seaweed for Biofuel is organised by the Algal Bioenergy Special Interest Group and Innovation Norway and is aimed at enhancing collaboration and addressing supply chain challenges around developing a sustainable and robust algal biofuel network. World Waste to Energy City Summit 2014 on 21-22 May in London, UK Registration is now open for the third annual World Waste to Energy City Summit, taking place in London in May 21-22, 2014, will once again bring together the leading players in the advanced waste to energy sector with the most active funders in the market for two days of interactive debate and networking. 20% delegate discount off registration for NNFCC members. Oleofuels 2014 on 11-12 Jun in Dusseldorf, Germany The change of name reflects the fact that the event will now cover all fuels made from oils & fats including biodiesel, HVO & bio jet as well as take a more global view, which is key especially when it comes to certain feedstocks. The two-day conference will bring together the leading executives and experts from across the entire value chain for two days of informative presentations, interactive discussion & excellent networking opportunities. 2nd International Conference on Algal Biorefinery on 27-29 Aug in Copenhagen, Denmark This international conference aims to share research experience on aquatic biomass resources, both micro-, and macroalgae as a potential source of food, feed, biochemical, biofuels and biofertlizers. The Bioenergy from Forest Conference on 15-18 Sep in Helsinki, Finland The Conference will focus on the factors affecting the future of bioenergy and biobased modern technologies and business solutions, including logistic systems, management, total procurement chains, the effects of the energy markets, the influence of green marketing and other trends
  • 13. NNFCC Market Review, April 2014, Page 13 of 14 affecting forestry, agriculture, industry and climate. Biofuels International Conference 2014 on 24-25 Sep in Ghent, Belgium The conferences will focus on the latest developments in biofuels policy, international biofuels trading, sustainability, solutions for first generation producers, progress in advanced biofuels and information on feedstock pricing and trends Feedstock Prices UK spot prices of wood pellets, and wheat and barley straw, as recorded on April 10th. Arrows indicate rise ↑, unchanged – or fall ↓ from previous month. Date UK Wood Pellets Delivered (£/tonne, 5% VAT) UK Ex-Farm Barley Straw (D1000) (£/tonne) UK Ex-Farm Wheat Straw (D1000) (£/tonne) April 10 235.00-285.12 (↓-–) 50.00-75.00 (– -–) 40.00-65.00 (–-–) For wood pellets prices we considered UK pellet traders selling prices. For details on straw spot prices, see www.fwi.co.uk
  • 14. NNFCC Market Review, April 2014, Page 14 of 14 UK (LIFFE), French (MATIF) and US (CBOT) future prices for wheat, rapeseed, maize, and soybean, as recorded on April 10th . Arrows indicate rise ↑, unchanged – or fall ↓ from previous month’s predictions. Date LIFFE Wheat (£/tonne) MATIF Wheat (€/tonne) MATIF Rapeseed (€/tonne) CBOT Wheat (cnts/bsh) CBOT Maize (cnts/bsh) CBOT Soybean (cnts/bsh) May 14 165.00 (↑) 208.25 (↓) 414.50 (↑) 669.00 (↑) 502.25 (↑) 1495.25 (↑) Jul 14 168.15 (↑) - - 677.25 (↑) 508.00 (↑) 1478.00 Aug 14 - - 374.00 (↑) - - 1394.75 (↑) Sep 14 - - - 687.00 (↑) 506.75 (↑) 1296.00 (↑) Nov 14 155.50 (↓) 200.25 (↑) 374.25 (↑) - - 1227.50 (↑) Dec 14 - - - 700.25 (↑) 505.50 (↑) - Jan 15 159.15 (↑) 200.50 (↑) - - - 1232.50 Feb 15 - - 373.50 (↓) - - - Mar 15 160.50 (↑) 200.50 (↑) - 712.75 (↑) 512.75 (↑) - May 15 160.65 (↓) 200.25 (↑) 373.00 720.00 512.25 - Jul 15 157.90 (↓) - - - - - Aug 15 - - 367.00 - - - For details on future prices see http://www.hgca.com Other biomass feedstock prices are available upon request, simply contact enquiries@nnfcc.co.uk Credits and Disclaimer NNFCC Market Review is edited by Dr Efthalia Arvaniti for NNFCC members. Feedback is welcome. The Review has been compiled in good faith and NNFCC does not accept responsibility for any inaccuracies or the products or services shown. NNFCC The Bioeconomy Consultants NNFCC, Biocentre, Phone: +44 (0)1904 435182 York Science Park, Fax: +44 (0)1904 435345 Innovation Way, E: enquiries@nnfcc.co.uk Heslington, York, Web: www.nnfcc.co.uk YO10 5DG.