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    Europe Reports

    Demand for Biomaterials to Increase in Europe

    There is a growing preference among consumers for greater use of biomaterials and/or renewables in products.

    Sean Milmo, European Correspondent10.08.20
    Analysts in Europe are predicting that once more normal economic conditions return, hopefully in the first half of next year, as the coronavirus pandemic wanes, the big pacesetters during the recovery will be companies still financially strong enough to revive the premium ends of their market.

    In sectors like coatings, the main differentiators between companies will be their ability to demonstrate sustainability, which in its broad definition covers the three pillars of finance and economics, environment and society and ethics.

    For coatings producers, financial strength is of prime importance competitively. A surprisingly large proportion of leading coatings players in Europe look likely to emerge from COVID-19 with healthy-looking balance sheets. Despite decreases in sales, they have managed to maintain relatively high-profit margins.

    For the ones focused on quality and technologically advanced products, this financial stability will enable them to concentrate on expansion in the aspect of sustainability with the most long-term potential for profitability – the environment.

    Gaining competitiveness in products with a distinct environmental benefit will require investment not only in R&D but in technical services and marketing.

    Consumers will want more environmentally friendly products. Opinion polls in Europe show that the pandemic has been shifting opinion in favor of more environmental sustainability in the post-COVID-19 period.

    This change has been reflected in policy decisions both at the national and European Union levels, with governments and the EU willing to fund environmental sustainability initiatives as part of efforts to revive economies after COVID-19 lockdowns.

    Both the EU and national governments have also been providing COVID-19-linked finance for projects which help them meet objectives such as achieving greater energy efficiencies in the fight against climate change. Most European countries have programs for reducing the energy consumption of buildings and homes.

    There is greater consumer pressure for both governments and businesses to do more to reduce pollution, particularly by plastics in the wake of publicity about contamination by plastics of rivers and oceans.

    But the big challenge for companies is biomaterials. There is a growing preference among consumers for greater use of biomaterials and/or renewables in products. For coatings producers and their raw materials suppliers this is emerging as a major task because consumers want the products to have the same quality – and often price – as coatings based on petrochemical-derived materials.

    The problem at present is a lack of suitable biomaterials to ensure performance similar to that of fossil-based coatings.

    Some coatings companies are already arguing that coatings which have been recycled under the circular economy concept being pushed by the EU for adoption across Europe should be classified as renewables. The objective is that in the European circular economies of the future coatings and other manufactured materials and their ingredients should be recycled for reuse so that they can go through at least two life cycles.

    With biomaterials coatings, companies are having to think in the long term. What is currently missing are infrastructures for supply chains which can become reliable sources of starting materials from the crop’s stage through to processing. At the stage of the development and production of the finished components like resins or pigments, the need for standardization and consistent quality becomes much more important.

    For many materials, adequate infrastructures serving the stages from the crop to the finished product do not exist at the moment. They could take years to create and fully establish.
    Some coatings companies – often multinationals – have been preparing the groundwork for sustainable infrastructures covering not just environmental aspects but social and economic ones as well.

    AkzoNobel has been forming networks based on partnerships and strong business relationships which are not only providing materials meeting the right specifications but also acceptable working practices such as labor conditions.

    In emerging economies, the company has a policy of visiting sites of suppliers of critical products for which there is no other “commercially attractive” source. These suppliers may be in areas
    “where local labor conditions, environmental conduct or business integrity, may not be (consistent) with our Vendor Policy and AkzoNobel’s Code of Conduct,” according to the company.

    Through the public-private partnership section of the EU research program Horizon Europe starting next year, a Circular Bio-based Europe (CBE) has been set up to carry on the work of creating networks of biomaterials suppliers. Hopefully, the new partnership, the second of its kind in the EU’s seven-year research programs, will reduce the fragmentation in Europe’s industrial biotechnology industry by creating regional but closely connected value chains.

    ‘’We are making efforts to involve new stakeholders such as the primary sector, regions and financial institutions,’’ said Dirk Carrez, executive director, Bio-based Industries Consortium (BIC), responsible for drawing up the CBE’s research agenda.

    The EU’s long-term objective is to make Europe climate neutral by 2050 through a series of circularity initiatives like that of CBE to encourage reuse and recycling of biomaterials in systems of end-to-end integration. “The overall objective,” said Carrez, “is more circularity and use of European biomass, residues and waste, with a focus on regional approaches, paving the way for climate neutrality by 2050.”

    Coatings companies and their raw material suppliers will be hoping that projects like CBE will help encourage investment in biomaterials production in areas like Eastern Europe where bioresources are relatively underdeveloped compared to those in Western Europe.

    DSM, a Netherlands-based leader in industrial biotechnology in Europe and a major supplier of coatings resins, launched last year a bio-resin for the decorative and architectural sectors. Early this year it also introduced an ultra-matt enabling version for the flooring market.

    Despite its advanced technology, the resin has only 35 percent plant content, mainly because of the lack of commercial quantities of monomers for making acrylic and methacrylate polymers.

    Hopefully, within a few years, sufficient monomers will be available on the market to raise the level to two-thirds or even three quarters. But this will still be below the company’s objective of 100-percent plant-based products.

    DSM also highlighted the difficulties of developing biochemicals, not only for the coatings industry but for other manufacturing sectors, when it pulled out last year from a nine-year-old joint venture for bio-succinic acid production with Roquette, a French specialist in the production of plant-based ingredients and materials.

    Only nine months previously BioAmber Inc., a U.S. headquartered bio-succinic producer with plants in Canada, filed for bankruptcy.

    Bio-succinic acid was regarded 10 years ago as being a bright prospect as a building block for biochemicals for making, for example, biosolvents and polyurethane ingredients for the coatings sector. Produced by sugar fermentation, it was seen as an environmentally friendly alternative to petrochemical-derived succinic, with less volatile price levels.

    It became uncompetitive with its fossil-based rival in the wake of the sharp dive in oil prices triggered by the boom in U.S. shale oil and gas.

    For coatings and other companies at the forefront of the sustainability drive the long-term objective, as with DSM, will have to be 100 percent plant-based products. But it could be a tough ambition to achieve as long as there is competition from petrochemical derivatives.
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