Triticale (X Triticosecale Wittmack) is a high‐productivity cereal crop that holds great promise as an industrial feedstock for agricultural biorefineries, as it can grow on marginal lands. Several product derivatives can be envisioned; however, they need to be systematically explored and assessed using a sustainability perspective, in order to define a business model that would lead to a long‐term competitive position. This study presents a competitive analysis of triticale‐based product‐process alternatives defined on ethanol, polylactic acid (PLA), and thermoplastic starch polymer blends (TPS/PLA) product platforms. As part of the analysis framework, we sought to identify a set of important market‐oriented criteria for multi‐criteria decision‐making (MCDM), prior to an overall sustainability assessment in which techno‐economic and environmental criteria are considered as well. From an initial set of necessary competitiveness criteria, three ‘most‐important’ competitiveness criteria for the sustainability assessment of the PLA platform were identified including competitive access to biomass, competitiveness on production costs, and the potential to manage market price volatility. Certain key factors have been highlighted for each platform as an outcome of the competitiveness assessment, such as the impact of value‐added co‐products on the competitive position of commodity‐based product portfolios, and the advantage of combining grain and straw process lines for specialty‐based product portfolios leading to improved competitive potential. © 2018 Society of Chemical Industry and John Wiley & Sons, Ltd

As a result of new lignin extraction plants hatching and increasing volumes of technical lignin becoming available, a variety of lignin derivatives, including phenolic resins and polyurethane (PU) foams, are reaching the marketplace or being used as intermediate products in many industrial applications. In the spectrum of possible lignin derivatives, thermoplastics appear particularly attractive due to a symbiosis of market, policy, and technology drivers. To assess the preferredness for lignin-based thermoplastics, this paper adapted a risk-oriented methodology formerly applied to assess lignin usage in various applications (phenol-formaldehyde [PF] resins, PU foams, and carbon fiber applications) to the case of lignin-based thermoplastics using hydroxypropylated lignin (HPL) and miscible blends of lignin and polyethylene oxide (PEO). The HPL is considered for garbage bags and agricultural films applications, while lignin-PEO blends are used as replacement for acrylonitrile butadiene styrene (ABS) in applications such as automotive parts. In the methodology, two phased-implementation strategies were defined for each thermoplastic derivative, considering perspectives for profit maximization (90 metric tons/day integrated units) and revenue growth (350 metric tons/day overall capacity), which were considered for implementation within a softwood kraft pulping mill. A set of six criteria representative of the main economic and market competitiveness issues were employed, and their respective importance weights were obtained in a multicriteria decision-making (MCDM) panel. Early-stage techno-economic estimates were done as a basis for the calculation of decision criteria. Compared to product derivatives previously assessed, capital investment for thermoplastic strategies appeared marginally higher due to the required lignin modification steps (on average 30% higher at similar capacity, and 6% for higher-scale revenue diversification strategies). Higher operating costs were also observed due to increased chemical expenses for all thermoplastic strategies, which are ultimately balanced by revenues associated with targeted thermoplastic products, leading to greater annual margins and cash flow generation over the project lifetime for thermoplastic strategies compared to other product applications (58% to 66% higher on average, at similar scale). Benefits of improved economics were reflected in economic criteria, internal rate of return (IRR), and cash flow on capital employed (CFCE), as well as in the price competitiveness criterion, CPC. Overall, the combination of relatively high lignin content in the plastic formulation and the less costly modification method contributed to lignin-PEO strategies, gaining the top two rankings. Based on their overall scores, both strategies defined for HPL would also integrate the group of “preferred” strategies, but are outranked by strategies that consider lignin positioning on PU foam applications.

Many pulp and paper companies are considering implementing a lignin-based biorefinery to diversify their core business to new products and improve their longer-term competitiveness. The best strategy to achieve might not be obvious, considering the lignin extraction process and derivatives to be implemented over the longer term that meet market and business objectives, and provide competitive advantage. In this article, various lignin biorefinery strategies were considered in a case study involving lignin precipitation processes integrated within an existing kraft mill, and solvent pulping processes that would be implemented in parallel to the existing mill processes using additional hardwood. The analysis aimed to identify the conditions under which various strategies would represent suitable investments. Operating constraints in the case study mill limited lignin extraction to 85 metric tons/day from 15% of the mill’s black liquor, whereas 260 metric tons/day lignin could be extracted by solvent pulping 1500 metric tons/day of hardwood. The preferred strategies identified by the study were lignin precipitation to phenolic resins production, and solvent pulping to carbon fiber production. The first product-process strategy requires lower investment, provides high returns (internal rate of return [IRR] of 39% to 43%), and is more easily implemented in the near term. Solvent pulping resulted in reasonable profitability (IRR of 18% to 25%), with higher production volumes and a diversified product portfolio, and was considered more suitable as a longer-term strategy. Business model robustness and long-term competitiveness can be better assured by combining both strategies. It was shown that 1) government support to offset capital cost, and 2) high derivatives market prices positively influence lignin valorization strategies, which are sensitive to technology and market maturity.

The lignin biorefinery is emerging; there has been significant progress in recent years regarding lignin extraction and conversion processes, their implementation at the commercial scale, and the validation of lignin substitution potential in various applications. In this paper, seven strategies for implementing the lignin-based biorefinery into a kraft pulp mill were considered, and different performance metrics for these strategies were calculated in order to identify the “most preferred”. The different options addressed two distinctly different objectives that companies can consider regarding their biorefinery strategy, either (1) a near-term mill-level profitability improvement vision, or (2) a longer-term revenue growth-oriented vision. A phased-implementation approach was systematically defined for each option in order to mitigate technology and market risks. Lignin product applications that were considered included phenol replacement in phenol-formaldehyde (PF) resins, polyols replacement in polyurethane (PU) foams, and polyacrylonitrile (PAN) replacement in carbon fiber. A Multi-Criteria Decision-Making (MCDM) panel was executed for evaluating the seven lignin-based biorefinery strategies, using a set of economic, market risk, and competitiveness criteria. Although the panel selected Internal Rate of Return (IRR) as the most important criterion, Competitiveness on Production Costs (CPC) appeared to be the most important factor for distinguishing between lignin strategy options. CPC reflects the robustness of the biorefinery strategy relative to an aggressive price-cutting strategy from the competition. Overall, strategies involving lignin precipitation were more attractive economically, while those involving larger-scale solvent pulping processes and the associated larger revenue streams were considered better long-term strategies. The most preferred strategy considered by the panel was for precipitated lignin sold for both PF resin and PU foam applications. The next preferred strategy considered lignin sales to the same market segments, but at larger volumes. The next closely-ranked strategy considered the production of a lignin-based PF resin at the host mill. These three strategies were identified as “preferred,” for further, more detailed assessment.

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