Biomass industry players and stakeholders are urged to be more encouraging and appreciate the full potential of value-added products within the sector.
This is to tap the growing demand and higher returns from products in the value chain, said EU-Malaysia Biomass Sustainable Production Initiative (Biomass-SP) technical adviser Datuk Leong Kin Mun.
Products like biomass energy pellets are priced between US$120 and US$130 (RM360 and RM390) a tonne while a value-added product like biocomposite is about US$1,000 (RM3,000) a tonne, while biochemical can go up to US$3,000 (RM9,000) a tonne.
“To produce biochemical or carbonised products is no doubt more capital intensive compared with energy pellets. However, the former has higher value and bigger margin,” he said in an interview recently.
Global demand for biomass is growing fast and demand for solid biomass fuel in Europe is expected to double by 2020.
Countries like Europe, South Korea and Japan are already told by their respective governments to use biomass products to reduce the use of coal in power generation.
“This growing global demand for environment-friendly products provides an advantage for small and medium entrepreneurs (SMEs), who are actively creating new ideas in biomass-related products for the export market,” he added.
Local SMEs are mainly involved in the entry point of the entire biomass value chain due to lack of financial support to expand.
Leong suggested that major biomass players and SMEs hold dialogue sessions and synergise their businesses to tap into this high demand value-added biomass products.
“I hope financial institutions will be more adventurous and fund these green technology projects and continuously explore the potential that biomass industries have to offer,” he added.
Malaysia has a huge potential for biomass, which generates about 11 per cent of gross national income from the agriculture sector. A significant amount of biomass is generated every year across a variety of crops including palm oil, rubber and rice.
According to the Environmental Leader report, between the year 2010 and 2015, the global biomass manufacturing market is projected to increase to US$693.7 billion (RM2.08 billion) from US$572.9 billion (RM1.7 billion). This represents a compound annual growth rate of 3.9 per cent during the period.
Major biomass products can be categorised into 5F’s – fuel, fibre, food, fertiliser and feed for animal. In future, biomass will grow within the biopower, biofuels, and bioproduct sectors.
Biomass-SP, which is a development cooperation project funded by the EU under the Switch-Asia programme, is organising the four-day EU-Asia Biomass Best Practices and Business Partnering Conference 2012. The conference will be held from May 7 to 10 at the Putra World Trade Centre. Some 500 stakeholders are expected at the conference, which will feature over 80 speakers from Malaysia, Asia and Europe.