As with most things in life, cane payment systems are amenable to change and open for review, goaded not only by scientific and technical advances that heighten its value from embracing exploitation of these advances but mostly so. At the 2007 ISSCT Congress in, Adrian Wynne mooted the idea of including compensation to cane growers for bagasse as well. This was touch bit radical at the time as bagasse was mostly used to cogenerate power. Those industries that exploited it fully had in place government policy that incentivised both cogeneration and selling surplus power to the national grid. Availability and use of high-efficiency boilers capable of producing steam at high pressure and temperatures along with replacing low-efficiency mill turbines with hydraulic drives and DC motors and other fine-tuning have supported significant efficiencies and increase in power output. This, in turn, has increased the competitiveness of the individual factories concerned. While this is the case, the compelling argument from millers is that at the end of the day, they are making the investment and taking the risk. Therefore, they really should not be liable for the additional charge. While the former is true, the latter is suspect as there is a market for surplus power produced – in effect, the government policy is cross-subsidizing their investment.
Some 17 years ago when the global sugar price hovered at around 6 cents/lb quite a few sugar companies in India were making more money from selling surplus power than from sugar. A couple of years ago, the Brazilian sugar-ethanol giant Cosan’s revenues from cogenerating power grew 245.7% compared with 22.3% for sugar and 19.1% for ethanol.
In the global cane industry, payment systems fall into the following broad groups: fixed cane price systems; fixed revenue sharing systems, and; variable revenue sharing systems1. While the latter two are by and large based on recoverable sugar where it pays to produce quality cane, the fixed cane price system is simply based on weight and prevalent mainly in India, Pakistan and China where it would be cost-prohibitive for millers to test cane for quality as they have to contend with supplies from many smallholders2.
According to the World Association of Beet and Cane Growers, there are only a few of industries where payment for bagasse is an additional component of the payment system. These are Belize, Reunion Island and Mauritius3. Though recent press reports suggest that while American Sugar Refining increased payment to growers, this was not specifically for bagasse. One recent development is that the growers supplying cane to the Folle-Anse sugar factory in Guadeloupe, where a 6.5 MW bagasse-based cogeneration is scheduled to be built, are likely to receive an additional premium of €14.50/tonne cane4.
Advances in industrial biotechnology have not only turned sugar into a superb feedstock from which to produce highly valuable platform chemicals but has also opened up the exploitation of bagasse for high-value products. Over the past decade, there has been considerable research on cellulosic biofuels, which involves breaking down biomass residues initially into cellulose, hemicellulose and lignin, and then into C5 and C6 sugars to make them available for the production of biofuels via the conventional fermentation routes. While there are few commercial-scale cellulosic biofuels plants in operation, the work on purifying lignin and exploiting it as feedstock has garnered significant interest. The tables 1 and 2 summarises research focus on lignin and lignocellulosic feedstocks and the opportunity that awaits the industry.
Table 1. Lignin – research interest during 2017-18
|VTT Technical Researcher Centre of Finland||LigniOx technology which converts lignin by-products from pulp mills and other biorefineries into concrete plasticizers that can compete with the synthetic and lignosulphonate-based admixtures on the market|
|US’ Sandia National Laboratories||A novel process to produce from lignin muconic acid and pyrogallol which currently have a combined market value of US$255.7 billion.|
|UPM||An industrial scale biorefinery producing wood-based chemical intermediates such as bio-monoethylene glycol (bMEG) and bio-monopropylene glycol (bMPG) plus lignin.|
|Leaf Resources||biodegradable coating|
|US DOE, Ames lab||plastics|
|Texas A&A Agrilife||Carbon fibre from lignin from paper waste|
|Meridian Waste and Advanced Lignin||high performance green plastics|
|The Institute of Textile Chemistry and Chemical Fibres (ITCF) based in Denkendorf, Germany||Carbon fibre composites.|
Table 2. Lignocellulosic feedstocks – research interest during 2017-18
|University of Wollongong||xylose and arabinose, furfural and HMF (hydroxymethylfurfural|
|University of Delaware||furans|
|Anellotech||aromatics, including paraxylene, benzene, toluene and other xylenes|
As these biotech technologies mature and entrepreneurial sugar companies begin to exploit them, while they would have a strong case to decry a charge for profitizing handsomely from bagasse, a moral imperative should oblige them to be generous to the growers.
1 From Cane payment systems chapter by Martin Todd et al (2004) in Sugarcane, 2nd edition, edited by Glyn James, published by Blackwell Science
2 A typical factory in India gets cane from some 40,000 growers.
3 Report by Timothé Masson, WABCG, November 2015, How is the value of beet and cane shared between growers and factories throughout the world?