No bricks without straw – new value chains for crop wastes

By Dr. Luca Urciouli, Adjunct Professor at ZLC.

Cultivation, harvesting and crop processing produces large volumes of waste and residue – straw, stalks, top growth, prunings, husks, pulp and so on. Typically these may be ploughed in, used for animal feed or bedding, or burned in the open. The idea that these wastes might have further value is not new: indeed the science and technology needed to reprocess wastes into a wide range of biofuels, chemicals and other commodities is well understood.

Ideally, processing wastes to produce bio-commodities would offer economic benefits in the form of additional revenue streams for farmers, transporters and processors; social benefits (reducing the seasonality of employment and boosting rural development) and environmental gains – substituting for feedstocks currently derived from fossil fuels, food crops or virgin timber, and reducing the pollution from open burning and other disposal methods.

The difficulty, though, lies in creating viable value streams. Many of the issues are logistical, because for example the materials are widely dispersed at low densities, which is why a ZLC team has been closely involved with the recently-completed AGROinLOG project.

AGROinLOG, funded from the EU Horizon 2020 budget, is intended to improve the profitability and competitiveness of agro-industries by turning them into Integrated Biomass Logistics Centres supporting biomass value chains. “A biomass value chain connects several logistics concepts to describe the flow process of the feedstock from collection in the field to its transformation at the IBLC” and of course its subsequent, profitable, on-sale.

Less formally, the idea is that these businesses (processors, who may themselves be farmers, or may buy in the crop) and their partners already possess or have access to many of the assets required. These include harvesting machinery, which can perhaps be adapted to collect wastes as well as the crop, transport and storage facilities, and much of the necessary processing plant such as driers, macerators and pelletisers. They also have existing commercial relationships with growers, transport contractors and in some cases likely buyers, and of course an existing workforce. Many of these assets, and the labour force, may only be fully utilised for a relatively short period during and post harvest.

The project, with 15 partners across 8 countries, started by examining in detail six agricultural processing sectors – vegetable oils, olive oil, animal feed and fodder, wine, grains, and (beet) sugar. Data was gathered on the types, volumes, locations and timings of wastes, their compositions, what commodities they might  be converted into, and their potential uses and markets.  We looked at the assets and processes that the relevant agri-businesses have available.

Three hybrid simulation models were developed by ZLC to understand the potential economic and environmental impacts of value chains which would be tested in three demos, in Spain, Greece and Sweden These models aim to support decision makers for different objectives: for example. how to optimally select suppliers from a portfolio in order to satisfy a certain set of criteria determined by a company; what quantities need to be purchased, when and with what frequency, given market demand and available idle-time in transformation plants; what is the optimal number of harvesting machines in order to complete the collection of raw materials to suit the idle-times of plants while keeping operational costs low; or predicting the impacts on costs and profitability of variability in climate, weather and harvest yields.

From these studies the project identified three partners in different sectors – fodder, olive oil, and cereal milling -  who were prepared to commit to near-full scale pilot demonstrations (two different value chains with each partner). Together these sectors account for around 10% of European agri-business turnover, and about 30% of those where there appeared to be inherent synergies around existing equipment, seasonality, and established food chain logistics.

In Spain, Agroindustrial Pascual Sanz produces animal fodder (as bales and pellets) from alfalfa, working at full capacity from April to September, but at lower or minimal rates for the rest of the year. The pilots here explored the use of existing processes to convert cereal straw and maize stalks, along with wood chips, into pellets for bio-energy, and also into material for bio-composite boards, as fibres for thermoplastic reinforcement, and as an adsorbent for hydrocarbons. Additionally, a process for creating levulinic acid and furfanal, both widely-used precursor chemicals in a range of industries, was demonstrated.

Olive growing produces a large volume of prunings which are either mulched or burned. In Greece, the industry is highly fragmented with many small growers selling to local mills for initial pressing. Nutria buys this pressing, through traders, to produce a refined and standardised product. One pilot here was to use low-season storage capacity at local mills to gather in prunings, before Nutria processes them, using its existing drying capacity, into either solid biofuel, or a feedstock for particle board production. Separately, another pilot looked at extracting phenols from exhausted oil mill cake – phenols have a value in themselves, and also their removal improves the performance of the anaerobic digestors used to dispose of mill cake.

Finally, in Sweden, Lantmännen is a cooperative milling grain from 29,000 farmers into flour for food and animal feed. They also have a bioethanol plant, using surplus grain or bought in feedstocks such as sugar. The pilot was to convert this process to use a non-food feedstock, straw. However, this is only likely to be profitable if value can also be gained from the lignin-rich residue from the bio-ethanol process through conversion into bio-oil (diesel substitute) or bio-char (a carbon-retaining soil conditioner). Also, while straw is of course seasonal, the aim is to operate year round, so there are storage issues.

The results of these demonstrations can be seen in full on the website at www.agroinlog.h2020.eu. Suffice it to say that the pilots were largely successful in technical terms, albeit with some reservations: the waste-derived materials are not in all cases fully competitive on performance with the existing alternatives. They may not, therefore provide a total replacement, and of course this also is reflected in the price they can attract at market. More development in these cases is needed.

Nonetheless the potential for creating value from a wide range and large volume of agricultural waste has been amply demonstrated, and some important lessons learned. One is the need to gather data and to model at very fine scale: the individual farm, even the individual field, as small variances can make a big difference to logistics costs.

Another is that the triple goals of economic, social and environmental benefit are not always compatible. It can be, for example, that far from smoothing seasonality of employment, the new value streams actually increase it, if the major waste-related activities coincide with the crop harvest. Environmental gains may not be clear-cut – collecting low density wastes generates a lot of transport movement, increasing costs, emissions, and traffic problems on country roads. The alternative may be to increase the density through chipping, drying or compacting in or close to the field, but this entails more cost and machinery and the additional activity on fields may increase soil compaction. Some wastes, or the ash from burning, are currently ploughed in as fertiliser or soil conditioner – these inputs may need to be replaced by artificial fertilisers.

The economic facts on the ground can also be complex. Government support for agriculture (for example, to grow food or timber crops for bio-energy) may not always be well-aligned. The economics of distributing the bio-commodity also have to be considered – there are reasons why relatively small scale production in rural areas struggles to be competitive. Target markets may not be receptive to novel sources of materials, with concerns over product performance or security of supply. Governments may wish to incentivise companies to at least trial these new products.

And, despite the project’s initial premises, existing supply chain relationships between farmers and processors may not be particularly relevant. For a crop, buyer and seller can negotiate, informed by a knowledge of market conditions. For ‘wastes’ though, the buyer may say “That is waste. I will pay you to collect it and transport it to me”, while the farmer may, not unreasonably, say “If this ‘waste’ has value to you, I want to see some of that”. Bio-commodity production may be competing with other markets for the same resources: for example the sale of baled straw to livestock farmers and  the equestrian industries.  Even in the Swedish co-operative model, there was a lot of discussion, negotiation, and knowledge building! Mixed farmers, for example, might be reluctant to sell on residues that they could use themselves for a different purpose, or look for compensation, perhaps in the form of discounts on fertilizers distributed through the same network

None of the above though should detract from the central finding of AGROinLOG: that there is indeed realisable economic, social and environmental value in exploiting agricultural wastes.

To learn more about AGROinLOG and the potential for Integrated Biomass Logistics Centres, visit the website at www.agrolog.h2020.eu.