PPI Online

Biofuels: the race to come second?

By Mark Rushton Mon, Mar 18, 2013

LONDON, UNITED KINGDOM, March 18, 2013 (RISI) -I have spent a bit of time recently looking outside of the pulp and paper industry, basically gauging what other opportunities there are for industry players and investigating the ones we keep hearing about - for example biofuels.

As part of this reconnaissance mission, I recently attended the World Biofuels Market Congress which was held in Rotterdam. I must admit I was expecting to see herds of pulp and paper people at the event but surprisingly there were very few - except for UPM whose workforce was there in droves - all disciples of the new Biofore vision and evangelising the BioVerno bio diesel product which comes onto the market in 2014.

So one has wonder - has UPM got this right, or will its brave entrance into the world of biofuels be a disaster? Perhaps by way of signal or sign, UPM picked up the Sustainability Award 2013 for Breakthrough Innovation in Technology at the Rotterdam event. The organisers said that this prestigious award recognises the innovation that is taking place in the "development of truly sustainable and renewable fuels".

My own guess is that it will all go swimmingly, and that before we know it, and in usual pulp and paper industry style, there will be overcapacity and we will have pulp and paper industry biofuels coming out of our ears!

A lot of interest from outside

But if the paper industry is not interested in what UPM or the biofuels world is doing, then there is certainly other audiences that are interested. The event in Rotterdam was absolutely packed, and in particular at Sari Mannonen, UPM Biofuel's intrepid director of business relations and marketing's presentation. The audience there were hanging from the rafters, and hanging on her every word. Why is everybody in the biofuels world so interested in what UPM has to say? Because the basic fact is that oil from trees is very friendly to the world population as it does not compete with food crops and the biofuels world is coming up against a lot of resistance from governments and NGOs for that very reason - in fact part of the event was hijacked by Greenpeace who was making its own point on the subject.

I actually think that there is a lot of interest in the industry on the biofuels front, but there is a terror of being first and all the problems associated with that. In fact one industry player I was talking to puts it very succinctly: "The pulp and paper companies basically want to be the first at being second" he says, "they don't want to trailblaze or pioneer, risk getting their fingers burnt or damaging their reputations".

Why wouldn't you want to be involved?

We at RISI are quite excited about all this biofuel stuff - it doesn't take a soothsayer to see that it makes absolute sense for the industry to be looking at ways of converting wood into useful products other than paper, and I have to admit that I am full of admiration for the courage that UPM is showing. In fact, so impressed are we that we have decided to do a bio track of our own at the nextRISI conference to be held in Vienna next month, complete with another appearance by Sari Mannonen of UPM Biofuels, as well as plenty of other Bio - industry stalwarts, industry players, commentators and technology suppliers.

The fact of the matter is, there is money swilling around, (UPM has just secured an EU grant for Euro 170 million to develop yet another bio project) there are profits to be made, the technology is available and the there is a world out there dying for bio based products. The pulp and paper industry is in also in an extremely advantageous position as all the infrastructure is in place, as well as access to wood. Why on earth wouldn't you want to be involved?

For more information on the Bio Track at the RISI conference, please visithttp://www.risiinfo.com/events/euro_conf/bio_program.html


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