Biofuels: The Next Generation

Why is every analyst jumping on the ‘is China/India growth slowing’ bandwagon now?  The indicators that industrial growth and demand for raw material consumption have been evident for some time now, so the recent flurry of activity surrounding the Asian slowdown should really be a confirmation of what we knew was coming for months, not news. 

That being said, while at the SugarAsia 2008 conference last week, I was very impressed by some of the discussions on alternative fuels.  In this sector, the slowdown may be an opportunity rather than a hindrance.  Not only regarding the developments in India, but also in the way that even small producers were aware of how their crops (sugar, jatropha, small grains, etc) could fit into a future energy matrix that is nothing like the one that exists today. 

Fossil fuels will of course still be around, but the vision described over and over is (a) much more diverse and therefore fiscally robust, and (b) one that certainly is preferable from a policy and inflationary perspective.  It also blatantly pointed out how misguided and antiquated the current US farm policies are. 

Regarding next-gen fuels, I was also very happy to see in a couple of the talks following mine, the fact that there were some very detailed discussions on the innovative and important work of (not yet public) companies such as Synthetic Genomics, LS9, and Amyris, and also the Joint Genome Institute, among others. 

On the publicly held side, there was a lot of talk about the research efforts coming out of BP (BP) and duPont, and while these giants have moved slow in the past, the market potential for some of their next-gen fuels initiatives may garner some attention in the months ahead.

 

Comments

[funfun:]

DuPont Management has bet a large swath of the Company's future on a flawed food business model, making food fabrics and food fuels. Using perfectly good food for, say corn clothes and corn carpets, and soon to be wheat bio-fuels, helps grossly inflate the price of food, and intensifies shortages. ...funfun..

2008 Aug 01 08:34 AM

[Michael Fer...:]

the research efforts referred to have nothing to do with food-for-fuel on the grains side...these are concenrated in sugarcane and synbio.

2008 Aug 01 08:52 AM

[fireball:]

i wonder why we do not follow brazil on this. dar and gu seem to have found a profitable niche. i used to own dar but took profits awhile back on a pretty good rise. u.t. amd dow(i think) are building a plant that is to use switchgrass and corn cobs to make fuel. this seems like a better approach to me but it would make more sense to use a proven south american method since the political line is we need it. could those rascals be lying again?

2008 Aug 01 10:37 AM

[rhj123:]

Government embargos and subsidies are major problems with our experimental fuels programs. Our private businesses know how to use sugar cane, switchgrass, corn, slaughterhouse fats, etc., if left alone by Government interference.

2008 Aug 01 12:17 PM

[fireball:]

BOBJOU to err is human but it takes government to really screw it up. yes i think some real progress could be made if they would stay out of it and get out of the way.

2008 Aug 01 01:00 PM

[louis Hemmings:]

why no mention of jatropha in these next generation bio fuels listings? has nobody in the USA ever heard of it? you almost mentioned jatropha when you mentioned BP's investigated biofuel, as they have partnered with the recently hammered D1 Oils....

2008 Aug 01 03:18 PM

[User 250373:]

Informative article Michael. Ignore the first commenter 'fun fun'. Unfortunately, the nature of message boards allows for no discerning at first read who's a nut and whose nut. Go to the DD yahoo message board and then you will know this 'fun fun' is a first rate NUTCASE.

If you have any more info on progress Dupont is making with alternative feedstocks please write another article.

2008 Aug 25 05:37 AM