South Africa's bio-renewable chemicals ready to fly

The growing market for bio-renewable chemicals in South Africa has great potential. Recently, US growth consulting firm Frost & Sullivan conducted a detailed analysis of this market, and recommended bio-renewable raw material suppliers or prepare to enter the industry. Manufacturers enter the South African market. The short-term strategy proposed by Frost & Sullivan is to improve the capabilities of existing companies in all aspects; the long-term strategy is to rely on private sector investment and the support and guidance of government departments to promote the maturity of South Africa's bio-recycling industry. .

Bio-renewable chemicals are generally produced and processed from corn, wheat, potatoes, grape seeds, and soybeans. The main varieties include lactic acid, biosuccinic acid, 1,3-propanediol, and glycerin. Among them, lactic acid can be used not only as a mineral lactate, but also as a lactate ester, polylactic acid, and other biological materials in addition to the food industry.

Succinic acid is currently mainly produced in South Africa from petroleum feedstocks. Biosuccinic acid can be made from glucose, which comes from corn or wheat starch. The main advantage of biosuccinic acid is that it can sink carbon dioxide during production. Most of the current 1,3-propanediol used by South Africa's large companies comes from bio-renewable raw materials. It can be used to make engine coolant. Its advantages are good thermal stability, low corrosion, and low toxicity. As for glycerol, the traditional method of hydrolysis production has now been replaced by a biodiesel-based production method. In South Africa, the potential for the production of glycerol from renewable raw materials is greater.

The South African bio-renewable chemicals market started late. In the past two years, although some companies have started to invest in bio-renewable chemicals, the basic products are still under development. The South African government plays a pivotal role in the development of the bio-renewable chemicals industry because such green chemicals are beneficial to the protection of the environment and are encouraged by the government.

To develop biochemicals, the availability of raw materials is a key factor. South Africa has abundant raw materials such as corn, wheat and sugar, which is one of the reasons for its huge market growth potential. At present, South Africa is engaged in the production of such products mainly from agricultural products companies, multinational chemical companies, and paper and pulp companies. Lignotech, a company that produces chemicals from lignin, is one of the largest biorenewable chemical companies in South Africa, and some sugar companies such as Tongaat Hulett Sugar, Tang The Tongaat Hulett Starch company and the Illovo Sugar company also produce renewable chemicals from sugar waste. In addition, some papermaking companies also use biorenewable raw materials to produce chemicals.

In 2009, South Africa’s sales of bio-renewable chemicals were US$75.7 million, an annual growth rate of 4.8%; in that year South Africa’s output of such products was 97,130 tons, with an annual growth rate of 4.5%. According to figures provided by Frost & Sullivan, the growth rate of such products in South Africa in 2010 was 5.6%.

The development of the biorenewable chemicals market in South Africa is mainly due to the following factors: First, the stability, predictability and availability of raw materials and their prices are the main drivers of the market. The main raw material of the chemical industry today is non-renewable petroleum raw materials, whose prices fluctuate due to changes in political and weather conditions. In contrast, renewable raw materials such as sugar, starch, and cellulose organisms are reasonably stable and predictable in price. Second, biorefinery has a higher profit potential than fuel. In addition, it can produce many other high value-added chemicals, and the production of these chemicals requires bio-renewable materials. Third, the chemical industry tends to be green and environmentally friendly. Therefore, manufacturers are required to seek new raw materials, and bio-renewable raw materials are ideal raw materials. Fourth, government-level support plans have also shifted downstream manufacturers to bio-renewable raw materials. In addition, private sector investment in this area has also contributed to this shift.

At the same time, this market development is also constrained by several factors: First, the lack of competitive prices is the biggest obstacle to the development of the bio-renewable industry. Currently, bio-renewable chemicals have advantages over the price of crude oil as raw materials because they enjoy government subsidies. However, if the development of biotechnology does not enable production to gain scale advantages at large production bases, the cost advantage of biorenewable products will not be available without subsidies. Second, there are still limitations on the integration of biofuels and bio-renewable chemicals into bio-refinery intellectual property protection. At present, only a few companies in South Africa have the technology to convert biofuels into by-products. From a global perspective, some companies have advantages in this regard, but their technologies and patents are all unique and incompatible with each other.