June 10, 2021

By Lynda Kiernan-Stone, Global AgInvesting Media

BDO stands for 1,4-butanediol – a key raw material traditionally derived from butane used to manufacture plastics, elastic fibers such as spandex, polyurethane coatings, automotive parts such as bumpers, solvents for printer ink, artificial leathers, and films.

Although necessary for the industrial production of a wide range of products, BDO is a fossil-based, non-biodegradable by-product of the petrochemical industry – and is in a class of materials that have come under heavy scrutiny and criticism due to their negative impacts on the environment. 

This has resulted in demand for the development and commercialization of biological variants. In 2018 the global bio-BDO market was estimated to be valued at $552.9 million with expectations for a CAGR of 5.64 percent between 2019-2025, according to Industry Arc. 

With a 38 percent market share in 2018, North America is expected to be the most lucrative bio-BDO market due to a significant uptick in demand for disposable plastics leading to U.S. production facilities to experience a 50 percent increase in production rates over the coming 10 years, and a tripling of plastic exports by 2030, according to the Surfrider Foundation.

Furthermore, since the bulk of these exports will be bound for developing and emerging nations, which lack the infrastructure and management framework to handle non-biodegradable plastic waste, the pressure is further increased on the U.S. to export more bio-based variants. 

Cargill and Hamburg, Germany-based HELM, one of the largest chemical marketing, logistics, and distribution companies in the world, have partnered to launch Qore – a joint venture to produce QIRA™, a new next-generation biological 1,4-butanediol (BDO) made by the fermentation of plant-sugars from corn.

When integrated into industrial production, QIRA™ can seamlessly replace its fossil-based counterpart, giving the apparel, electronics, fashion, automotive, and packaging industries the ability to significantly improve their environmental footprint by reducing greenhouse gas emissions by as much as 93 percent. 

“For HELM Chemicals, this joint venture marks an important milestone in our commitment to providing solutions for a successful transformation to a sustainable planet and society,” said Axel Viering, a member of the executive board for business line chemicals, HELM.

“Through partnership and collaboration with brand owners and their suppliers, we will bring sustainable product options to these consumer-driven industries that will not only help them differentiate their brands but also create a more environmentally responsible future.”

As consumer demand for more environmentally friendly products consistently gains strength, Cargill and HELM are collectively investing $300 million to build the first commercial-scale, renewable BDO facility in the U.S.

Located at Cargill’s existing biotechnology campus in Eddyville, Iowa, the plant will not only give farmers a new market channel for their corn, but will give diverse and disparate industries the ability to improve their environmental footprint without compromising product performance or manufacturing processes. 

“With consumers demanding more sustainable products, brands are not only looking for more innovative, environmentally-friendly solutions but also are needing supplier capabilities and resources that can consistently meet those expectations,” said Jill Zullo, vice president, biointermediates/bioindustrial, Cargill.

Once the plant is completed and operating in 2024 (with initial annual production targets of 65,000 metric tons for its first bio-intermediate), the partnership will use Cargill’s end-to-end supply chain, product commercialization, and fermentation manufacturing expertise, along with HELM’s experience with commercializing unique chemical applications to produce and commercialize its unique, sustainable option.

Commenting on the partnership, Viering said, “Through partnership and collaboration with brand owners and their suppliers, we will bring sustainable product options to these consumer-driven industries that will not only help them differentiate their brands but also create a more environmentally responsible future.”

– Lynda Kiernan-Stone is editor with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Oilseed & Grain News. She can be reached at lkiernan@globalaginvesting.com.