October 28, 2009

5 Min Read

If a Mid-South bioeconomy grows into a mature industry, you might see more winter crops being grown, a reduction in pastureland, small changes in crop mix during the summer season and quite a number of biorefineries dotting the rural landscape.

According to the experts, whether or not this new look will be good for farmers depends a lot on who owns the biorefineries. If they are owned by farmers and farmer cooperatives, farmers can capture added value from them. If somebody else owns them, agriculture’s economic health probably won’t benefit as much.

To make sure the money ends up in agriculture’s pockets means the entire agriculture community needs to start thinking about its role today, say Pete Nelson and Randy Powell, with BioDimensions, whose task it is to bring biomass producers and processors together.

“We need to build a whole new supply chain, literally putting factories in the fields, with farmers supplying the feedstock for commercial fuels and other products,” said Powell. “This supply chain does not exist today. It’s going to be challenging and it’s going to require a lot of partnerships and collaboration.”

“There are some big companies looking to come here,” added Nelson, founder of BioDimensions. “Do we let them come here, set up and contract out to us to supply a fixed price for materials? Or do we develop supply chains that we have value in?”

The way to get farmers warmed up to the idea might be different in each state, according to Nelson.

“In Tennessee, we used our Extension agents across Tennessee to bring farmers together. We had a little bit of state money to mitigate their risk. We didn’t want to work with anyone who wasn’t ready to lead in this area.”

The result was the 25Farmer Network, “who are essentially business partners with us,” Nelson said. “We’re trying to get the farmers involved early so they can understand what will work and what may not work in our region.”

Nelson says that every study on the Mid-South bioeconomy has shown that biorefineries should be decentralized. “We’re not going to be able to shift biomass very far from where you grow the crop.”

One reason for that is the low-bulk density of biomass crops, according to Powell. “If you’re trying to move rice hulls or whatever, the low bulk density will cost you too much money in transportation. So the factories have to be where you grow the crop in rural locations.”

Nelson says it’s imperative that farmers get involved in the process. “With biodiesel and corn ethanol, the farmers have been left out there on their own. We have to bring in people who know how to add new product development and interface with customers, so there is a partnership between the farm and the factory.”

In Mississippi, Sumesh Arora with Mississippi Technology Alliance, a non-profit organization based in Ridgeland, Miss., works with various economic development groups around the state and operates a seed fund to help early-stage companies and entrepreneurs.

Over the last two and a half years, 30 entrepreneurs have received some level of funding from the seed fund and other sources, according to Arora. The common thread among them is they have developed their own unique technology or innovative business model. MTA is working closely with two biorefinery companies that plan to locate in the state.

To learn more about the MTA, go to www.mta.ms/biomass.

Another important key is the ability to staff biorefineries with local talent, which will require specialized, highly-trained people.

“Ten years from now, the biorefinery industry will have created 25,000 new jobs, according to Powell. “Some will be on-farm jobs, some will be logistical, moving biomass around, but the bulk of the jobs will be in the new biorefineries.

“There will be some professional jobs, but most of the jobs will be technical. The training will come from community colleges, with wages comparable to what we see in the Delta.”

The educational process has already begun. Arkansas has a nationally recognized curriculum in biomass processing, and training has begun at a network of community colleges in Arkansas. The University of Memphis has developed training programs as well.

“All of these programs are completely open to sharing and collaboration,” Nelson said. “We don’t have to go outside the region to develop a workforce training program for the future. We’ve got all the expertise right here in the region.”

According to Nelson, a mature bioeconomy will require 25 percent of idle land, 25 percent of CRP land, 15 percent of pastureland and 10 percent of row crop land, “applied to something like sweet sorghum, where you really don’t lose the land, like you do with switchgrass. You can put it into a rotation.”

Frank Howell, with the Delta Council, in Stoneville, Miss., which helped sponsor research on developing the bioeconomy, noted that the MTA and the Mississippi Development Authority “have really done some groundbreaking work here in Mississippi. They’re doing things the right way.”

Arora says the bioeconomy in the Mid-South “has the potential to become a reality. But a lot of groundwork has to be done first. A lot of times, how technology is accepted has to do with how the message is conveyed. It’s like the Betamax versus VHS (video formats). One won out over the other even though technically it was not the superior format. The bioindustry is going to have to go through the same education curve.”

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