BBE 3503-5503 – Markets and Marketing of Bio-based Products The Bio-mass Resource Dr. Tim Smith Associate Professor, CEM & Bio-based Products Director, Forest Products Management Development Institute University of Minnesota BBE 3503-5503 – Markets and Marketing of Bio-based Products

Things to think about… What is biomass and do we have enough of it? Where is it? Can we meet consumption needs sustainably? Should we be concerned about deforestation? Biodiversity? Sustainable agricultural systems? What other systems might be impacted by rapid growth in industrial bioproducts? What influence does the resource have on the development/continuation of bioproducts markets? | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

Bio-energy and Bio-power Biomass is already making key energy contributions in the US - nearly 2.9 quadrillion Btu (quad) of energy in 2003. The largest domestic source of renewable energy. Biomass currently supplies over 3 percent of the total energy consumption in the US — mostly through industrial heat and steam production by the pulp and paper industry and electrical generation with forest industry residues and municipal solid waste (MSW). Biomass is particularly attractive because it is the only current renewable source of liquid transportation fuel. Biomass consumption in the industrial sector will increase at an annual rate of only 2% through 2030. But, biomass consumption in electric utilities will double every 10 years through 2030. Combined, biopower will meet 4% of total industrial and electric generator energy demand in 2010 and 5% in 2020. | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

Bio-based Transportation Fuels and Bio-based Products Transportation fuels from biomass will increase significantly from 0.5% of U.S. transportation fuel consumption in 2001 (0.0147 quad) to 4% of transportation fuel consumption in 2010 (1.3 quads), 10% in 2020 (4.0 quads), and 20% in 2030. Production of chemicals and materials from bio-based products will increase substantially from approximately 12.5 billion pounds or 5% of the current production of target U.S. chemical commodities in 2001, to 12% in 2010, 18% in 2020, and 25% in 2030. | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

(Wisner 2007) | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

Composition of the Current Resource Base | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

Summary of biomass resource consumption | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

Annual biomass resource potential Currently, slightly more than 75 percent of biomass consumption in the United States (about 142 million dry tons) comes from forestlands. The remainder (about 48 million dry tons), which includes biobased products, biofuels and some residue biomass, comes from cropland. | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

Summary of the Forest Biomass Resource | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

UN Food & Agriculture Organization (FAO) Global Regions | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

World Forest Cover (2000) | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

Forest Cover to Wood Volume to Industrial Roundwood Region Forest Cover Wood Volume Industrial Roundwood Fuelwood Europe 27.0% 15.5% 13.3% 2.2% South America 22.7% 8.8% 3.5% 5.3% Africa 16.9% 16.7% 14.5% North/Central America 14.2% 23.0% 18.9% 4.1% Asia 14.1% 34.2% 7.2% Oceania 5.2% 1.5% 1.3% 0.2% | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

American industrial roundwood consumption and production to 2010 Source: Global Forest Products Model, 2003 | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

American industrial roundwood trade to 2010 Source: Global Forest Products Model, 2003 | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

Percent Protected Forest, 2000 | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

Conclusions We have enough wood in some places not enough in others. Natural resources are global and local issues. Availability of natural resources require infrastructure (physical, social, political). Efficiency of resource utilization requires infrastructure and prosperity. Poverty is possibly the biggest obstacle to sustainability. Deforestation is a problem, but not necessarily the fault of industry. BUT, industry must be part of the sustainability solution. Sustainability ≠ Protectionism In global markets, sustainability goes beyond borders, forests, biodiversity, free trade, or fair trade – someone will grow more trees. The question becomes what impact do these activities have on the environment, economies, and societies. | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

Forest and Forest Products Residues | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

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Summary of the Agricultural Biomass Resource | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

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(Wisner 2007) | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

(Wisner 2007) | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

(Wisner 2007) | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

(Wisner 2007) | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

(Wisner 2007) | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

Agricultural Resource | UNIVERSITY OF MINNESOTA, Department of Bio-based Products

Significant Productivity Improvements | UNIVERSITY OF MINNESOTA, Department of Bio-based Products