June 22 (Bloomberg) -- When the U.S. Army fought in the Pacific during World War II, it discovered a fungus eating soldiers’ cotton tents. Six decades later, scientists have genetically engineered the organism to make cheaper biofuels.

Danisco A/S of Copenhagen cultivates the fungus to create enzymes that break down plants to produce ethanol. CSM NV, the Amsterdam-based food company, uses knowledge gleaned from elephant dung to brew the biofuel, a substitute for gasoline.

Producing a cheaper automobile fuel from plant chaff has become the environmental grail also for Denmark’s Novozymes A/S, Royal DSM NV of the Netherlands and DuPont Co. They’re seeking new business in the U.S., where $2 billion of government aid was approved for non-crop biofuels to wean some of the nation’s 250 million registered vehicles off gasoline.

“If we can look at strange and unconventional places to find enzymes, we do,” Feike Sijbesma, chief executive officer of Heerlen-based DSM, said in an interview. “Nature has been busy for millions of years.”

Enzymes and yeasts pioneered by the developers may be worth $5 billion a year by 2025 in a $60 billion to $80 billion market for fuel alcohol from plants, said Jens Riese, head of biofuels at the consultant McKinsey & Co. For a market that big, costs must tumble. Making the “second-generation” biofuels currently costs as much as four times more than “first-generation” fuel from edible crops such as corn, wheat or sugar cane, he said.

Crop Waste, Grasses

“You need to optimize the entire process,” honing yeasts and enzymes, Riese said. Food-crop waste and fibrous grasses must be treated with heat, steam or chemicals, then enzymes are used to break the plant’s cell walls, or cellulose, down into its constituent sugars. Yeasts convert those into fuel alcohol.

Ethanol from inedible plant-matter may not be available in significant quantities at competitive prices for a decade due to the need to build factories and buy feedstock, said Simo Honkanen, senior vice president at Neste Oil Corp., which makes 170,000 tons of conventional biofuels at a factory in Finland.

“Resolving this problem and commercializing these fuels is not around the corner,” Honkanen said. “The main challenge is the scale. It’s going to take a while to build up the supply chain and all the infrastructure and operations.”

While producers are still on a “learning curve,” once two or three refineries have been built, the industry may expand rapidly, said Rick Kment, an Omaha, Nebraska-based biofuels analyst with the agricultural researcher DTN.

Doubling Business

CSM, Danisco, DSM and Novozymes are improving the enzymes and yeasts, working with U.S. partners including DuPont and Poet LLC to connect the full chain, from plant matter to ethanol.

The new fuels don’t use the edible parts of corn and wheat and avoid land-use changes that raise greenhouse-gas emissions. Conventional biofuels accounted for as much as 15 percent of food-price inflation from 2007 to 2008, the U.S. Congressional Budget Office said April 8. Converting land to cultivate food crops for fuel can cause carbon-dioxide output 420 times greater than the annual savings, U.S. scientists said in Nature in 2008.

The enzymes needed for so-called cellulosic ethanol may be worth $3 billion, the size of today’s market for the proteins, which are used to make detergents, pig food and cheese, said Tjerk de Ruiter, chief executive officer of Danisco’s Genencor unit, which researches in Palo Alto, California.

“It would double our business if we were able to maintain the same market share,” de Ruiter said in a telephone interview. That would amount to $750 million, and Danisco is hoping to make even more out of cellulosic ethanol by working with DuPont, he said.

DuPont Tennessee Plant

DuPont and Danisco each put $70 million into a joint venture to turn plant waste and energy crops into fuel, a process they can license to ethanol producers. To test the method, they’re building a pilot plant in Vonore, Tennessee, that’s due to begin production in December.

Danisco’s Genencor unit has turned the fungus discovered by the U.S. Army into its “main platform” for multiplying the enzymes that break down cellulose, Genencor Vice President for Business Development Philippe Lavielle said in an interview.

The Army was “trying to isolate the fungus to kill it,” and early research on Trichoderma reesei focused on “how to prevent it from working and propagating,” he said.

The organism naturally produces enzymes, which act as catalysts to break down organic matter. Genencor genetically engineered the fungus to become more effective and to produce new enzymes that are then used to convert cellulose more quickly into sugar, the basic building block for biofuel, Lavielle said.

Stone-Wash Jeans

“We have domesticated this fungus from a wild type,” Lavielle said in an interview from Palo Alto. “It’s the same as taking an animal in the wild and domesticating it to produce more wool or milk, but at the micro level.”

Genencor started working on the fungus in the 1980s and now uses the enzymes to stone-wash jeans, bleach paper and treat animal feeds to make them more nutritious, he said.

Possible sources for enzymes useful in ethanol-making include deep-sea volcanic vents, salt lakes and termite guts, Lavielle said. DSM studied adapting enzymes it uses in fruit juice-making while Novozymes Chief Science Officer Per Falholt said his company, based in Bagsvaerd, Denmark, found many useful enzymes in forest fungi from Denmark, China and the U.S.

CSM’s Royal Nedalco unit worked with Bird Engineering and Delft University to develop a yeast containing enzymes found in elephant dung. The company has licensed its technology to Boston-based Mascoma Corp., and works with several other undisclosed U.S. firms, CSM Business Development Manager Mark Woldberg said.

‘If It Flies’

Novozymes also is collaborating with a “number” of U.S. partners, including Poet, Chief Executive Officer Steen Riisgaard said. The company works with China’s Sinopec and Cofco Ltd. and with the fuel alcohol industry in Brazil, the world’s largest producer of ethanol from sugar cane.

“It’s by far the biggest research endeavor we have ever undertaken,” Riisgaard said in a telephone interview. “If it flies the way we’re expecting and working for, it will transform Novozymes as a company.”

In Brazil, where 90 percent of new cars sold in 2008 can run on ethanol, production of the fuel could double if brewers use sugar cane waste known as bagasse as well as the sugar from the crop, Riisgaard said.

Advances in enzyme processes and increased U.S. subsidies - - $1.01 a gallon compared with 46 cents for first-generation biofuels -- could make cellulosic ethanol competitive with conventional biofuels next year, Riisgaard said.

Edge in U.S.

Under the Renewable-Fuel Standard passed by Congress in 2007, the U.S. must produce 36 billion gallons of ethanol for transportation fuels by 2022, including 20 billion gallons of non-food biofuels. President Barack Obama’s administration on May 5 outlined plans to spend almost $2 billion to encourage production of advanced biofuels that don’t rely on food crops.

That’s given the U.S. the edge over the European Union in building cellulosic ethanol refineries, which cost up to $200 million, according to De Ruiter.

“If you look in terms of government support, incentive schemes, the U.S. provides a really good environment,” Nedalco’s Woldberg said. “In Europe, it’s a bit lacking and there’s not much clarity on biofuels policy.”

The final hurdle for second-generation ethanol will be making it cheaply enough to compete without subsidies with fossil fuels, said DSM’s Sijbesma, whose company is building a refinery in Hugoton, Kansas, with Spain’s Abengoa SA.

“One day, oil will be over and, more importantly, before that it will be expensive,” Sijbesma said. “The moment you talk about oil prices above $100, you’re talking about processes which are renewable, environmentally friendly and can get an economic advantage.”

reactie XEA.nl
Analisten proberen nu uit allemacht nog verhalen de wereld in te sturen al zou er dit of dat.
Laat je als belegger niet misleiden, volg je eigen gezonde verstand.
Wij werden door een lezer op dit artikel gewezen, met dank.
In het verhaal staat de Nedalco een onderdeel is van CSM, maar dat WAS, want Suiker Unie is nu volledig eigenaar van Nedalco en al enige jaren, in dec. 2004!

Berichten uit de martk.
CSM zou de banden met Teijin (Jap. zie http://www.teijin.co.jp/english/index.html) willen versterken.
Cargill heeft licentie rechten van CSM in het verleden gekocht. Wij weten echter niet voor welke termijn.
Purac is de leveranciers van die rechten. CSM is wereldmarkt leider in de PLA, o.a. voor afbreekbaar Plastics.

Zie ook elders dit bericht,
Teijin transfers 50% ownership in NatureWorks back to Cargill.

toevoeging op 3/7/09
tijd 07.51
Ook zal de ligging van de Grondstof fabriek in Thailand de samenwerking (mogelijke) van Teijin met CSM Purac is de kaart spelen. Cargill zit in de VS en dit is vlak bij de deur.