10th starch & derivatives conference › stc10 › downloads › stc10_proceedings_pa… ·...
TRANSCRIPT
10th Starch & Derivatives
Conference Geneva, April 10th, 2013
PROCEEDINGS PART II
Organisers
GIRACT 24, Pre Colomb
1290 Versoix/Geneve Switzerland
www.giract.com [email protected]
Paper 4 _____________________________ _____________________________ _____________________________
STARCH DEMAND FOR THE PAPER & BOARD INDUSTRY AND IMPLICATIONS ON GLOBAL
SUPPLY CHAIN
JOHAN SCHRIJVER
TATE & LYLE
_____________________________ _____________________________ _____________________________
STARCH DEMAND FOR THE PAPER & BOARD INDUSTRY AND IMPLICATIONS ON GLOBAL SUPPLY CHAINS
Koen Homburg/Johan Schrijver, Tate & Lyle
10th Starch & Derivatives Conference
April 9/10, 2013.
Hotel Beau-Rivage
Geneva, Switzerland
2
4/24/2013 4/24/2013
© Tate & Lyle 2010 2
José Manuel Durão Barroso
President of the European Commission
Statement (March 6th, 2013) by President Barroso
following his meeting with Ms Yingluck
Shinawatra, Prime Minister of Thailand
………. Secondly, I am delighted to announce, together with Prime Minister
Shinawatra, the launch of negotiations on a free trade
agreement between the European Union and Thailand. Our
bilateral trade amounted in 2011 to almost €30 billion, and the
EU is also a very important investor in Thailand; I am deeply
convinced that this Free Trade Agreement can bring substantial
benefits to our already strong trade and investment relations.
So, my message today is very clear: we are
entering a new era in our relations.
…….
3
4/24/2013 4/24/2013
© Tate & Lyle 2010 3
Agenda
Tate & Lyle
Industrial Market Volumes
Food versus Industrial
Europe/global volumes
Industries Paper/Board
Corrugating/Construction
Value of starch application
Growth
Raw Materials
Supply Chain
Conclusion and challenges
Resources and support
4
4/24/2013
Tate & Lyle overview
4
Founded in the UK in the mid 19th century; Tate and Lyle businesses
merged to form Tate & Lyle in 1921
Headquarters in London and listed on London Stock Exchange:
− member of FTSE 100
− market capitalization of £3.6 billion
Business built on core values of safety, respect and integrity
Production facilities, laboratories and offices in over 30 countries
4,300 employees worldwide
Sales of £3.1 billion and operating profit of £323 million(1)
Customers include many of the world’s largest food and beverage
manufacturers, and industrial and pharmaceutical customers
(1) For financial year ended 31 March 2012
5
4/24/2013
Tate & Lyle’s strategy and operating model
5
Speciality Food
Ingredients
Bulk
Ingredients
Global business units
Shared business services and corporate functions
Global growth unit
Common IS/IT platform
Global support services
Global IS/IT
Innovation and Commercial Development
Customers
Operating Model Strategy
What:
The leading global provider of speciality food ingredients and solutions
How:
Disciplined focus on growing our Speciality Food Ingredients business:
– Innovation and agility
– Deeper customer understanding
– Stronger positions in high growth markets
Driving the Bulk Ingredients business for sustained cash generation to fuel this growth
6
4/24/2013
Bulk Ingredients
US
Sweeteners
EU
Sweeteners
Industrial
and other
• Corn sugars
• Dextrose
• Glucose
• Starches for paper and paperboard
• Acidulants/fermentation/bio-chemistry
• Corn co-products incl. animal feed
• Corn sugars
• Dextrose
• Glucose
Tate & Lyle’s ingredients portfolio
6
Speciality Food Ingredients
Starch-based
Speciality Ingredients
High Intensity
Sweeteners
Food
Systems
• Speciality starches
• Speciality sweeteners
• Soluble corn fibres
• Diary stabilizer systems
• “Bespoke” blending
• SPLENDA® Sucralose
• PUREFRUIT™ monk fruit extract
• TASTEVA™ Stevia Sweetener
7
4/24/2013
Tate & Lyle’s Innovation and Commercial Development
unit is a key driver of growth
7
Combines R&D, Open Innovation, Global Marketing and Platform
Management
Close collaboration with customers worldwide
Responsible for innovation pipeline and launch of new products
8
4/24/2013
Tate & Lyle’s global locations
8
© Tate & Lyle 2010 4/24/2013
9
4/24/2013
Tate & Lyle’s Values
9
Our Core Values form the foundation
on which our business has been built
over a hundred years.
Our Performance Values define
what we need to do to succeed
in business today.
10
4/24/2013
EU: Food versus Industrial starch based products
Different sources, AAF and
T&L calculations
Starch: Paper/board/packaging: 60% native, 40% modified
Native starch Industrial: >70% of all native starches
Modified Starch industrial: 68% of all modified starch.
2012: 8.9 million tons
58%24%
18%
Syrups/Blends
Native
ModifiedModified
11
4/24/2013 4/24/2013
55%
17%1%
2%
2%
23%
Paper& Board
CorrugatingBoardTextile
Construction
Europe: Starch demand total by application
Total 4.5 million ton
Misc. sources: Giract,
CHAD, T&L
12
4/24/2013
Part 2 Growth in the Industrial starches Europe Total
Different sources, AAF and
T&L calculations
Paper/board/packaging: >70% of industrial
Chemicals and Bio: part syrups/sweeteners
0.000
1.000
2.000
3.000
4.000
5.000
6.000
2006 2010 2015 2020
in m
illi
on
to
ns
Other
Chemicals Bio
Construction
Corrugating board and adhesives
Paper and Board
AAF and T&L
calculations
13
4/24/2013
Global: Starch demand by application
Total 22-25 million ton
Giract and T&L
calculations
42%
34%
9%
15%
Food
Paper andBoard
CorrugatingBoard
Otherindustrial
14
4/24/2013
European Paper and Board by paper grade
4/24/2013
15
4/24/2013
European Paper and Board Production
4/24/2013
16
4/24/2013
Production versus consumption
4/24/2013
17
4/24/2013
Paper & Board: global consumption
4/24/2013
18
4/24/2013
18 © Tate & Lyle 2010
4/24/2013
Global: paper & board consumption per capita
19
4/24/2013
Starch consumption in the paper industry and expectation
• Global paper and board production is 400 million tons, so
(1.6%) of starch is needed 6.4 million tons of starch
To understand the growth in starch demand we have to
understand:
• Value of starch and development in the application
• Population and GDP development world wide
• Growth in paper and board production
20
4/24/2013
Value of starch: Properties of different native starches
4/24/2013
For all application in the paper industry, starch will be modified by
the starch supplier or paper mill and differences in these properties
will be reduced
21
4/24/2013
21
Industrial Applications Products by type and application
Application Type of product Function
Corrugation Crosslinked
Native
Glue-Carrier-
Viscosity
Wet-end Cationic Retention-
Strength
Surface Sizing Cationic
Dextrin
Native (Can be used for
Enzymatic or Thermo-
chemical conversion)
Surface
Properties
Printability
Strength
Coating Dextrin Binder
Construction
industry
Modified Native Binder
22
4/24/2013
Application of starch in Paper and Board Shares in volume en trends
• Surface sizing 60 % (↑)
Improving (surface) strength and prevent dusting
• Wet-end starch 22 % (↑)
Improving strength of the paper
• Coating 15% (↑↑)
Binder for pigments
• Spray starch 3% (↔)
Improvement of plybond
4/24/2013
23
4/24/2013
FOEX pulp and paper index 2nd of April 2013
Tuesdays 12:00
am 2.4.2013 Chg previous Chg beg year
Pulp NBSK USD USD 837.49 +0.47 +28.12
Pulp NBSK EUR EUR 654.03 +7.58 +40.08
Pulp BHKP EUR EUR 626.39 +7.48 +38.28
Pulp BHKP USD USD 802.09 +0.73 +26.78
Paper LWC EUR 671.86 +0.73 -16.70
Paper Ctd WF EUR 676.55 +0.26 -19.97
Paper A4 B-copy EUR 849.89 +0.54 -13.00
Paper Newsprint EUR 478.31 -0.27 -17.26
Kraftliner EUR 580.08 +0.28 -3.93
White-top
Kraftliner EUR 767.58 +1.15 -9.97
Testliner 2 EUR 441.83 +0.10 +15.74
Testliner 3 EUR 415.57 +0.39 +14.08
4/24/2013
24
4/24/2013
Trends
• Paper industry is very much cost driven. Current over
capacity in Europe and high pulp prices are the main reasons.
• Use of more filler in the sheet increases the need for more
(cationic) wet-end and surface starch.
• Packaging companies tend to reduce basis weight of the
board. This increases the need for more surface starch to
keep stiffness and surface strength.
• In a coating formulation the latex is the most expensive
component. The petrol based binders are over 3 times more
expensive than starch. Modified starch can replace a part the
latex.
4/24/2013
25
4/24/2013
• Strength is one of the most important
characteristics of paper. Not only in packaging
but also in tissue and fine paper.
• Paper makers have several options to increase
strength:
• Choice of fiber source (high cost impact!)
• Fiber treatment, refining (high energy cost)
• Level and source of filler
• Use of dry strength additives
Strength
26
4/24/2013
Dry strength
Organic: Dosage: Appl Cost
Starch (0,5-1,5% on paper) 3-9 €/t
Guar Gum (0,1-0,3% on paper) 6-18 €/t
CMC (0,3-0,5% on paper) 8- 12 €/t
Synthetic: (0,1-0,5% on paper) 15-25 €/t
PolyVinylamine
PAM (polyacrylamide)
PAE (poly aminoamide-eipchlorohydrin)
GPAM (cationic glyoxalated polyacrylamide)
4/24/2013
27
4/24/2013
Starch vs Synthetic Additives
• Natural binders such as starch are relatively cheap compared
to synthetic binders
• Beside strength additive and increases filler retention
• Starch add to stiffness of the paper
But….
• Starch needs expensive cooking equipment
• Starch can increase the COD level of the paper mill’s waste
water
• Starch increases the need for biocide, since it’s a nutritional
source for bacteria
• Cationic starch retention depends highly on salt level of the
process water (degree of water closure)
4/24/2013
28
4/24/2013
Value proposition of starch as dry strength agent:
15 kg/ton cationic starch at 620 euro/ton
Dosage cost = 9 euro/ton
Typical strength increase 10-15%
Filler replacement:
cost of filler = 120 euro/ton
cost of pulp = 630 euro/ton
Increase in strength by 10-15 % can increase filler levels by 4-
5 %, the value of which is between 20-25 euro/ton paper
Reduce fiber by 3-4 %, the value of which is between 18-24
euro/ton paper
4/24/2013
29
4/24/2013
Value proposition of starch as coating binder:
Latex cost 2000 euro/ton
Binder Starch cost 600 euro/ton
Latex can be replaced up to 30-50 % on total binder.
Total latex cost = 70 euro/ton paper
Latex replaced by starch:
30%- 50% = 12- 26 euro/ton paper
4/24/2013
30
4/24/2013
Value proposition of starch corrugated board glue or Gypsum board
Corrugated board and Gypsum consist of 2-3% starch
Starch cost = 12-18 euro/ton corrugated
Synthetic alternatives = 30-60 euro/ton corrugated
4/24/2013
31
4/24/2013
Conclusion Value
• The added value of starch in the paper industry is still almost
double the cost of starch. This counts for all applications in the
paper industry and alternatives.
• Since synthetic alternatives in the corrugated board are 3 times
more expensive, the added value of starch in this industry is
even higher.
• Starch will stay as a very important additive in the paper and
board industry and its share will most likely grow.
32
4/24/2013
Population and GDP development world wide
4/24/2013
33
4/24/2013
33 © Tate & Lyle 2010
4/24/2013
IMF projection of GDP until 2016 for historical
top 10 GPD countries
34
4/24/2013
34 © Tate & Lyle 2010
4/24/2013
Example: main growth container board and Tissue
35
4/24/2013
35 © Tate & Lyle 2010
4/24/2013
Example: Tissue consumption world wide
36
4/24/2013
36 © Tate & Lyle 2010
4/24/2013
Example: Indian Paper and Board outlook
Poyry
37
4/24/2013
Expectation Global demand for industrial starches
• World population will grow by 3 billion people by 2040
• Paper and board consumption will likely stabilize between 75-100
kg/capita world wide in the coming 25 years
• World paper production and starch demand will grow strongly in
Asia and South America
• Paper consumption in the USA will drop significantly and the
consumption will stabilize at European level or slightly lower
• Only based on the extra 3 billion people , the paper and board
consumption will grow between 150 and 300 million tons, which
counts for 2.4 – 4.8 million tons of starch by 2040.
• Total demand for starch for the paper and board industry will be
between 10-12 million tons. (double consumption!)
• The corrugated board consumption will grow and stabilize on the
Western European level. This will give a consumption of maximum
0.7 kg starch/capita. Here the volume will increase by 2.5-4 million
tons of starch by 2040. The global starch consumption in corrugated
board industry will be between 5-7 million tons/a.
37 © Tate & Lyle 2010
4/24/2013
38
4/24/2013
World Corn Production vs Usage
39
4/24/2013
World Corn Stocks/ Ratio
40
4/24/2013
World Corn Yield
41
4/24/2013
Stocks to Use Ratio
14 %
12 %
24 %
22 %
14 %16 % 16 %
15 %
10 %9 %
6 %
0 %
5 %
10 %
15 %
20 %
25 %
02/03 03/04 04/05 05/06 06/07 07/08 08/09 09/10 10/11 11/12 12/13
US Corn - Stock to Use Ratio
42
4/24/2013
World Corn Production (all depends on the USA!)
The USA started the season with big hopes for a record crop, but yields dropped from 166 to 122 bu/ acre!
43
4/24/2013
US Corn Yield Trend
US Corn Yield
65.0
85.0
105.0
125.0
145.0
165.0
1971
-72
1973
-74
1975
-76
1977
-78
1979
-80
1981
-82
1983
-84
1985
-86
1987
-88
1989
-90
1991
-92
1993
-94
1995
-96
1997
-98
1999
-00
2001
-02
2003
-04
2005
-06
2007
-08
2009
-10
2011
-12
Year
Bu
shel
s /
Acr
e
44
4/24/2013
Corn Stocks by Country
45
4/24/2013
USDA Corn S&D
06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/14
Planted Acres 78.30 93.50 86.00 86.40 88.20 91.90 97.20 96.50
Harvested Acres 70.60 86.50 78.60 79.50 81.40 84.00 87.40 88.80
Yield (bushels per acre) 149.1 150.7 153.9 164.7 152.8 147.2 123.4 163.6
Carryin 1,967 1,304 1,624 1,673 1,708 1,128 989 632
Production 10,535 13,038 12,092 13,092 12,447 12,360 10,780 14,530
Imports 12 20 14 8 28 29 125 25
Total Supply 12,514 14,362 13,730 14,773 14,183 13,517 11,894 15,187
Feed/Residual 5,540 5,858 5,182 5,125 4,795 4,548 4,550 5,400
Exports 2,125 2,437 1,849 1,980 1,834 1,543 825 1,500
Food/Seed/Ind 3,541 4,442 5,025 5,961 6,426 6,437 5,887 6,110
Ethanol for Fuels 2,119 3,049 3,709 4,591 5,019 5,011 4,500 4,675
Total Use 11,206 12,737 12,056 13,066 13,055 12,528 11,262 13,010
Carryout 1,303 1,624 1,673 1,708 1,128 989 632 2,177
CO/Use Ratio 11.6% 12.8% 13.9% 13.1% 8.6% 7.9% 5.6% 16.7%
13/14 = USDA OUTLOOK PROJECTION 2/22/13
46
4/24/2013
CHINA CORN S&D
46
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
200,000
220,000
240,000
260,000
280,000
01/ 02 02/ 03 03/ 04 04/ 05 05/ 06 06/ 07 07/ 08 08/ 09 09/ 10 10/ 11 11/ 12 12/ 13
in m
ln t
on
s
Carry- In Imports Production Total Demand (incl. exports)
Source: USDA - Updated: Apr 3,
47
4/24/2013
EU- 27 CORN S&D
0.000
10.000
20.000
30.000
40.000
50.000
60.000
70.000
80.000
0.000
10.000
20.000
30.000
40.000
50.000
60.000
70.000
80.000
05/ 06 06/ 07 07/ 08 08/ 09 09/ 10 10/ 11 11/ 12 12/ 13 13/ 14*
Carry- In Imports Production Total Demand (incl. exports)in mln tons Source: Strategie Grains/ USDA/ own estimate
48
4/24/2013
Corn Futures
Matif futures might rally on the back of US futures…
Matif
CME
49
4/24/2013
MATIF Corn and Wheat Price
150.00
160.00
170.00
180.00
190.00
200.00
210.00
220.00
230.00
240.00
250.00
260.00
270.00
280.00
290.00
Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13
Corn Settlement price Wheat Settlement price
50
4/24/2013
GMO – Commercial Planting of GMO Crops (1997- 2012)
51
4/24/2013
Supply Chain
52
4/24/2013
Cost of shipment and Supply chain
Undoubtedly, the evolution
of the transport world between 2010 and 2050 will
offer many challenges, the biggest of which is
providing sustainable transport for the seven to
nine billion people at the lowest social cost
possible. These scenarios show that government
policies will play a critical role in determining the
most likely pathway into the future. World Energy
Councel
1500
Handling
1
5
53
4/24/2013
Conclusion/Challenges
The global consumption of starch in the main industrial markets
(Paper, Board, Corrugated board and Construction) will increase by
2040 (or much earlier) to a level of 15-19 million tons/a.
This growth is all expected outside the EU, NAFTA, Japan, and
Australia.
The starch value is much higher than shown by the market price,
surely in comparison with the direct alternatives. The price levels are at
such a low level due to very competitive (paper) industry and high focus
on food by starch suppliers
The starch raw material will be mainly corn (dent) based and this part
will grow. There will be a shift away from all the other starches in the
industrial applications.
The supply chain will remain short: limited handling and short
distances. Only short overcapacities will initiate short term long
distance shipments.
54
4/24/2013
PaperChem, UK Global Patterns of Starch Demand Producers, Products, Markets,
Supply, Demand 2011 – 2015, Giract May 2012 Chemical Additives for the production of Pulp and Paper, CHAD A GLOBAL PERSPECTIVE OF THE FUTURE OF STARCH USE IN
THE PAPER INDUSTRY DETLEV GLITTENBERG, MIIKA JOKINEN CARGILL STARCHES & SWEETENERS EUROPE
Fields for food or fuel, 2025, scenarios for a new biomass regime, project work.
The CEPI 2050 roadmap, Marco Mensink, CEPI Annual meeting 16/11/2011
IMF RISI Poyry, Finland The State of the Paper industry 2011.Environmental Paper Network Global Transport Scenarios 2050: World Energy Council Anderungen des Konsumentenverhaltens in der Nutzung von
Druckmedien. PTS Nachwachsende Rohstoffe fur die Paperindustrie. PTS China Paper Chemicals Market Study.CBI China Starch & Fermentation Analyses, LMC, Feb 2013
Resources: literature
55
4/24/2013
Support
Cathy Darwent, Paperchem, UK
Dr. Michael Schwarz, Voith GMBH, Germany
Dr. Roland Pelzer BK Giulini, Germany
Vincent, Pierre, Valentin, Michal, Lon, Roy, ao: all T&L
4/24/2013
Hanan, PM2, 4500 t/d, 11.8 m
56
4/24/2013
Koen Homburg/Johan Schrijver, Tate & Lyle
Who knows the target, can decide.
Who decides remains calm
Who remains calm is certain
Who is certain can think
Who thinks can improve
Thank you from Tate & Lyle
10th Starch & Derivatives Conference
April 9/10, 2013.
Hotel Beau-Rivage
Geneva, Switzerland
Paper 5 _____________________________ _____________________________ _____________________________
GLOBAL SHIFTS IN STARCH SUPPLY
JO GOOSSENS
GIRACT
_____________________________ _____________________________ _____________________________
GIRACT Geneva Switzerland
Global Shifts
in theStarch World
Jo Goossens, Giract
10th Starch & Derivatives Conference
Geneva, 10 April 2013
GIRACT
www.giract.com2
Presentation Outline
Shifts? … what shifts?
� Geographic, product, raw material, players, markets
Forecasting the future?
Megatrend effects:
� Demographics, resources, technologies, multi-polarity, climate change, fragility of systems
� mega-worries or mega-opportunities?
A new starch world…
GIRACT
www.giract.com3
Shifts?
GEOGRAPHIC
RAW MATERIAL
Key Players Markets
Products
GIRACT
www.giract.com4
Geographic shift primary starch production
Annual growth 2006-2010China 15.0%Other Asia 5.6%EU27 2.2%NAFTA -0.8%
GIRACT
www.giract.com5
Geographic shift consumption
Annual growth 2000-2010 2006-2010China 10.8% 10.4%Other Asia 2.5% 4.3%EU27 2.9% 2.2%NAFTA -0.9% -1.3%
GIRACT
www.giract.com6
Product portfolio shift
Annual growth 2000-2010 2006-2010Native starch 4.2% 7.9%Glucose 1.5% 2.8%Hydrolysates 6.7% 1.3%Dextrose 3.2% 0.7%Modified starch 4.9% 0.6%Polyols 4.7% -0.8%HFS 0.5% -0.1%
GIRACT
www.giract.com7
Leading players shifts
China
� Consolidation progresses
� 50% of starch output now controlled by 10 companies
� Top 10 around 85% average capacity utilization
� Top 5 - 10% of world output
GIRACT
www.giract.com8
Raw material shifts
Output increase since 2000
� Tapioca +105%
� Maize +20%
� Wheat +46%
� Potato +6%
GIRACT
www.giract.com9
Market shifts… no not really
Native/modified starch market: 60% Non-food – 40% food
Small changes only in other starch derivatives
Market demand oscilates between sectors as a result of price fluctuations
GIRACT
www.giract.com10
Forecasting the future
Since 2003 Giract endeavored to forecast these shifts in starch derivative demand based on:
� Macro-economic parameters
� End-use market growth forecast
� Changes in starch penetration in end-use
� Changes in starch derivative preferences (product change-overs)
� Historical starch derivative dynamics
� Anticipated regulatory/trade environment
� Other dynamics
What is the conclusion looking back ????
GIRACT
www.giract.com11
Forecasting the future
Starches
� Typically underestimated China and Other Asia
� Overestimated switch modified>native in Europe
� underestimated switch modified>native in NAFTA
GIRACT
www.giract.com12
Forecasting the future
Glucose – overestimated China and Other Asia
Glucose & HFS – overestimated NAFTA
GIRACT
www.giract.com13
Forecasting the future
Hydrolysates – underestimated China
Hydrolysates – overestimated NAFTA
Polyols – underestimated China and Other America
GIRACT
www.giract.com14
CompanyTransactional environment
what we can influence
Contextual environment
what we cannot influence
The environment is changing - from limited exposure
Since the mid 90’s, the industry has become increasingly exposed to external factors beyond its control and thus risk and strategy option assessment have become more difficult
<<’’9090’’ssCrop variation
Energy cost
Intervention prices
GIRACT
www.giract.com15
CompanyTransactional environment
what we can influence
Contextual environment
what we cannot influence
The environment is more uncertain
Since the mid 90’s, the industry has become increasingly exposed to external factors beyond its control and thus risk and strategy option assessment have become more difficult
>’90’s
GMO
Nutrition &
Health
Safety &
Traceability
CAP reform
Global trade
China boom
Sustainability
Bioenergy
Financial syst.
GIRACT
www.giract.com16
Uncertainty increases with these megatrends
- Aging, health, urbanisation, migration
- Fossil energy, minerals, water, space, ecosystems, labor, finance
- ICT, genetics, nanotech, biotech, mechatronics,…
- Asian advent, consumer power, new societal patterns,
- Weather patterns, sea-level rise, biodiversity, pandemics,…
- Social, finance, ecosystems, trade, global politics,
Ch
an
gin
g
De
mo
gra
ph
ic
Ba
lan
ce
s
Sc
arc
ity
of
Re
so
urc
es
Ac
ce
lert
ain
g
Te
ch
no
log
ica
l
Ch
an
ge
& I
mp
ac
t
Fro
m U
nip
ola
r
to M
ult
ipo
lar
Wo
rld
s
Cli
ma
te C
ha
ng
e
Inc
rea
sin
g
Fra
gil
ity
of
all
Sy
ste
ms
GIRACT
www.giract.com17
Megatrend effects
Population size +20% (2025)
Aging 1/3 over 65 in 2025 in affluent regions of the world
Health issues 1.4 bio overweight 0.924 bio hungry
Migration increase due to economy, conflict, climate
EU: 85% of pop. growth is migration
Concentration 70% in cities (2050)
Social divide: Rich/Poor 1:3:2 >1:3:5 70% of middle class in Asia (2050)
New life patterns one-parent, active elderly
Ch
an
gin
g
De
mo
gra
ph
ic
Ba
lan
ce
s
GIRACT
www.giract.com18
Megarisks or … mega-opportunities
RISKS
•High calorie food & drink
•Food security > raw material and ingredient price volatility
OPPORTUNITIES
•Nutritional benefits,
•Elderly food
•Processed food development in Asia
•Migration will enhance globalisation of food habits
•Urban development
•Middle class spending power
Ch
an
gin
g
De
mo
gra
ph
ic
Ba
lan
ce
s
GIRACT
www.giract.com19
Megatrend effects
Sc
arc
ity
of
Re
so
urc
es
With no change in consumption patterns, demand for food, water, land, energy will be 2x planet’s capacity (2030)
Uncertainty of biomass availability and price volatility (raw material, energy)
Land-grabbing China, Brazil, India in Africa
Water battles 2/3 world population in drought-prone areas
Shifts to more self-sufficiency in energy
Local production/sourcing constellations
Waste as raw material double waste output (2020)
Super-efficient urban environments
Biodiversity erosion
GIRACT
www.giract.com20
Megarisks or … mega-opportunities
Sc
arc
ity
of
Re
so
urc
es
RISKS
•High energy and logistics costs
•Raw material availability and prices
•Cost of production (labor, investment)
> Margins?
OPPORTUNITIES
•New drive for diversification and innovation
•Drive towards sustainability
•Biofuels
•Biorefinery concepts
•By-products as new raw material sources
•Competitiveness vs. oil-derivatives (?)
GIRACT
www.giract.com21
Megatrend effects
Ac
ce
lert
ain
g
Te
ch
no
log
ica
l
Ch
an
ge
& I
mp
ac
t
Technological development contributes to relieving the pressure in the system but alos creates new pressures in society due to unintended consequences
Decoupling of resources and economic growth
Automatisation/robotisation > labor (demand, quality)
Optimal efficiency monitoring/steering/use
IP value erosion open source, open innovation
Virtual communities +/- social cohesion
Technology gap in populations/generations
Issues over acceptability (GMO, nano, biofuel)
Information overflow big data
Digital criminality
GIRACT
www.giract.com22
Megarisks or … mega-opportunities
Ac
ce
lert
ain
g
Te
ch
no
log
ica
l
Ch
an
ge
& I
mp
ac
t
RISKS
•Creative destruction in industrial production and use
•Big industry faces investment gap to bridge speed of change > smaller scale and more flexible set-ups
•Speed more important than economy of scale?
•Intellectual property
OPPORTUNITIES
•Process and use control (speed, effectiveness, quality)
•Logistics chain control and anticipation
•New products (nano, biotech)
•ICT driven market & technical service
GIRACT
www.giract.com23
Megatrend effects
Fro
m U
nip
ola
r
to M
ult
ipo
lar
Wo
rld
s
Despite the globalizing world, it also becomes more fragmented, at the global, local, societal and personal level
More power centers (Brazil, Asia)
Shifting priorities from global to regional (megaregio’s, megacorridors, megacities)
Networked structures and organizations
Fading borders between industries (ICT/telecom, media)
Hyper-individualized consumption
Heterogeneity in society (culture, religion, social class, health status)
Tensions in international relations
Vulnerability to disruptive events
GIRACT
www.giract.com24
Megarisks or … mega-opportunities
Fro
m U
nip
ola
r
to M
ult
ipo
lar
Wo
rld
s
RISKS
•New competitors in new regions
•Disruptions in the production and logistic chain
•Corporate social responsibility
•Multi-cultural working environments
•Managing a global agenda
OPPORTUNITIES
•New customers in new regions
•New partnerships in development, production, marketing, investment
•New product/service concepts end-users > new product/service concepts for suppliers
GIRACT
www.giract.com25
Megatrend effects
Cli
ma
te C
ha
ng
eIt is no longer a myth but a fact. Keeping global warming below 2°C might be beyond our control
Frequency of climatological extremes (hurricanes, tornado’s, floods, rain/snow storms)
Water scarcity
Sea level rise
Ecosystem fragility (up to 22% of all ecosystems in the world may be affected) and loss of biodiversity will affect agricultural output
Pandemics (due to shifting vectors, protein shortage,…)
Societal pressures due to migration of people from affected regions
GIRACT
www.giract.com26
Megarisks or … mega-opportunities
Cli
ma
te C
ha
ng
eRISKS
•Disruption of production and supply (energy cuts, transport blocks, site damage, …)
•Pressure on sustainability requirement for entire production chains (energy, raw material)
OPPORTUNITIES
•Changing cultivation options in major agricultural territories
•Sustainability driven business models (e.g. car industry)
GIRACT
www.giract.com27
Megatrend effects
Inc
rea
sin
g
Fra
gil
ity
of
all
Sy
ste
ms
The complexity of systems and the growing interconnectedness between them also increases the risk for systemic failure
Protectionism
Self-sufficiency
More control mechanisms to avoid disruptive effects
Lower sense of security/safety
Growing demand for transparent decision making will increase influence of consumer/citizen
Weakening of global organsiations
New societal power blocks and independent organisations (NGOs, patient- and consumer groups, etc.)
Concentration70% in cities (2050)
GIRACT
www.giract.com28
Megarisks or … mega-opportunities
RISKS
•Disruption of logistic chains
•Failure of financial system
•Global trade disputes
•Protectionist barriers
•Transaction costs
•Growing interference from all kind of pressure groups
OPPORTUNITIES
•Those who want and can do things differently may regain credibility with societal actors and claim industrial thought-leadership
(e.g. Nike ‘Raising the Bar’, Patagonia Living with Limited resources’)
Inc
rea
sin
g
Fra
gil
ity
of
all
Sy
ste
ms
GIRACT
www.giract.com29
What new starch world will emerge?
How will this shape the starch industry?
GIRACT
www.giract.com30
How will the starch industry anticipate?
What new starch world will be created?
GIRACT Geneva Switzerland
Answers will only be found if one is preparedto raise the right questions in the first place
GIRACT Geneva Switzerland
Thank You