McKinsey Predicts: A Third Wave of Bio-based Materials Is Coming

  • 2022-09-19
The Biodegradable Materials Institute reports that the McKinsey Global Institute 2021 research report (scan the QR code at the end of the article to get the PDF report) predicts that in the next 10 to 20 years, advances in biology will be harnessed in materials, chemicals, and energy production. May increase the global market by 200 billion to 300 billion US dollars. A new wave of biomaterial revolution in chemistry and materials is unfolding as biological innovations are meeting downstream needs.

According to the US "Biomass Technology Roadmap" plan, by 2030, bio-based chemicals will replace 25% of organic chemicals and 20% of petroleum fuels. According to the EU's "Industrial Biotechnology Vision Plan", in 2030, bio-based raw materials will replace 6%-12% of chemical raw materials and 30%-60% of fine chemicals. In my country, the output value of the modern bio-manufacturing industry is planned to exceed 1 trillion yuan in the future, and the proportion of bio-based products in all chemical production will reach 25%. According to the forecast of the Organization for Economic Cooperation and Development (OECD), at least 20% (about 800 billion US dollars) of petrochemical products can be replaced by bio-based products in the next ten years. The current replacement rate is less than 5%, and there is a huge market gap. .

1. The development of bio-based materials is in the third wave

(1) The first wave of biomaterials lasted for thousands of years before the oil age. A large number of bio-based materials derived from plants or animals appeared in people's lives, including wood, paper, leather, textiles, etc., which are still in use today. .

(2) The second wave of biomaterials started in the 1980s. The rapid development of DNA recombination technology and other biotechnologies led to the emergence of the modern enzyme engineering industry, which also led to the leap-forward development of products such as washing powder and animal feed. . However, as the price of fossil-based chemical raw materials returned to normal levels (oil used to exceed US$140/barrel), the price of corn and sugar, the main raw materials of biomaterials, became highly volatile (corn rose from RMB 1,100 to RMB 3,000 per ton). / ton) weakening the potential cost advantage of biomaterials and gradually leading people to believe that biomaterials exist on the basis of a "green premium" rather than a commercialization option. It can also be seen from the historically low market share of biomaterials.

(3) The third wave of biomaterials is now. With the rapid progress of DNA sequencing, gene editing, artificial intelligence and other technologies, as well as more and more attention to emission reduction, biobased materials have become the general trend. Consumers, regulators and investors, the choice of these three groups will lead companies to place greater emphasis on sustainable chemicals and materials.

① First, consumer demand for "green products" is increasing. According to a McKinsey survey, consumers generally believe that sustainability is increasingly important. The vast majority of consumers from different countries say they are willing to pay more for sustainable packaging, including China (86%), the US (68%) and Brazil (66%).

② Regulators promote sustainable development through initiatives such as laws and international agreements. Important indicators include reducing carbon dioxide emissions and environmental leakage of non-biodegradable plastics. Both goals can be addressed with biomaterials.

③As ESG funds (Environmental, Social, and Governance) manage more and more assets, investors are putting more pressure on companies, such as requiring companies to reduce transition risks through decarbonization.

2. Leading companies have brought biomaterials to market

In response to demands from consumers, regulators and investors, many companies are working to reduce their environmental impact. The pathways they chose for sustainability included total material reduction (reduced packaging material), cargo origin (use of recyclable or renewable bio-based materials) and end-of-life (whether the material is recyclable, compostable or biodegradable). Biomaterials are one of many levers for improving sustainability.
For example, most of the top automakers and leading FMCG companies have pledged to significantly reduce greenhouse gas (GHG) emissions. For example, the parts of Mercedes-Benz, Audi, Toyota and BMW have introduced bio-based degradable plastics, and Apple, McDonald's, Chanel, Casio, etc. are all using bio-based materials.
McKinsey surveyed five chemicals and materials end markets and found that the vast majority of leading companies (74%) have made commitments on Scope 1 and 2 emissions reductions, and nearly 50% have committed to reduce Scope 3 GHG emissions.

3. Types and application scenarios of biomaterials

In addition to reducing costs and environmental impact, biomaterials companies must understand the technological differentiation of their products and the value chain of sales. Three biomaterials with different application scenarios for different end markets.

①Drop-ins biological and other exchange items:

This bio-based production route is used to manufacture products traditionally derived from petrochemical feedstocks, such as bio-based polyethylene.

"Drop-ins" refer to chemicals in existing products that can basically be exchanged without changing industrial operations.

For bio-based replacement chemicals, a 50% (or more) reduction in lifecycle carbon emissions compared to the traditional petrochemical route is possible, but this will vary depending on the bio-based and petrochemical routes. This represents an important value proposition for companies looking to reduce their Scope 3 footprint. Companies that successfully adopt Drop-ins can develop efficient, cost-competitive (though not necessarily lower-cost) processes and can target specific customer segments interested in green materials.

According to Braskem, every ton of bio-based PE produced captures 2.5 tons of carbon dioxide from the atmosphere.

②Bio-replacements Biological substitutes:
For this product type, bio-based chemicals are used to create a new material that is essentially identical to petrochemicals of the same type in terms of technical performance and cost, but with significantly improved environmental impact, such as novel bio-fermentative-derived Surfactant (for detergents).
But these are perhaps the most difficult products to succeed because they may require complex changes across the value chain while not providing technological differentiation. Success in this area requires keenly targeting use cases where regulatory and testing barriers are low, and building a strong consumer-facing market strategy.

③Bio-better products:

Unique biochemical synthetic routes can lead to entirely new material properties, such as biotechnology-derived optical films. In this case, technological superiority is the main driver of product acceptance, with the added benefit of enhancing the environmental profile. The rules of the game for the successful commercialization of traditional specialty chemicals basically apply to these products.

In addition, sustainability also raises many new issues that need to be solved through innovation, which is where "Bio-better" can focus. For example, it can not only reduce carbon emissions in automobiles, but also provide new high-performance biological base chemicals, or to further improve the recyclability of vehicles through new peelable adhesive materials, or the development of new biomaterials to increase heat dissipation to improve battery life and enable fast charging, etc.

© Copyright: DONGGUAN SENGTOR PLASTICS PRODUCTS CO.,LTD. All Rights Reserved.     SiteMap.xml | SiteMap.html | Terms & Conditions | Privacy


Leave a Message

Leave a Message

    If you are interested in our products and want to know more details, please leave a message here and we will reply to you as soon as possible.


Download product manual

Please fill in your email and we will send you the latest product manual