Farm chemical maker, Nufarm, is branching further into the bioenergy space, buying the energy cane assets of Brazilian industrial biotechnology company, GranBio Investimentos.
The 11-year-old GranBio group has been prominent in developing energy cane's opportunities, pioneering production of cellulosic ethanol and breeding plants with 150 per cent more biomass than conventional sugar cane.
It will continue co-operating with Nufarm under a licence agreement.
Nufarm has paid $37 million to buy GranBio group's energy cane germplasm, breeding materials and related know-how, products in various stages of development and customer contracts.
Energy cane is considered a step change in biofuel and electricity generation given rising global demand for biofuels as part of the push to reduce global greenhouse gas emissions from fossil fuels.
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Research indicates energy cane can boost ethanol output by 20pc to 30pc a hectare and lift bioelectricity generation by two to four times.
GranBio chief executive officer, Bernardo Gradin, described the new generation cane as "a very powerful global solution to secure large-scale, non-food biomass for biofuels such as net zero second generation ethanol and sustainable aviation fuel".
Brazil currently produces 32 billion litres of ethanol annually, almost entirely from sugar cane, with demand tipped to exceed 40 billion litres by 2030.
Nuseed expands
Nufarm's new cane business will be absorbed by Nuseed, the company's plant technology division.
Nuseed is already developing crops for the biofuel market, including the non-food oilseed crop carinata which is being developed as an aircraft fuel.
It intends to commence work in Brazil expanding energy cane research and development into other large existing cane growing countries, including Australia, the US and parts of Asia.
Energy cane has been bred to be planted in lower-quality soil areas not traditionally suitable for primary agriculture crops.
When combined with advanced second generation processing, the new era cane can generate net-zero ethanol, biogas, and bioelectricity, plus green industrial products.
Getting more from land
Nufarm managing director, Greg Hunt, said the agreement with GranBio was a tangible example of Nufarm's growth strategy in action and bolstered Nuseed's "value beyond yield" strategy.
The company was investing in sustainable innovative technologies which helped growers get more from their land.
While the deal was expected to deliver only modest underlying earnings before interest, tax, depreciation and amortisation in the short-term, it had significant potential to contribute to Nufarm's earnings growth over the medium to long-term as global expansion ramped up to meet demand for sustainable biofuels.
Nuseed group executive, Brent Zacharias, said the bioenergy cane move presented a unique opportunity for, and was highly complementary to, Nuseed's existing bioenergy platform, notably its proprietary low-carbon energy feedstock, carinata.
Adding energy cane, and leveraging our existing Nuseed Carinata platform, enables Nuseed to provide advanced feedstocks to a broader suite of energy forms
- Brent Zacharias, Nuseed
"Energy cane is a proven technology and innovation that is ready to deploy and scale," Mr Zacharias said.
"Adding energy cane, and leveraging our existing Nuseed Carinata platform, enables Nuseed to provide advanced feedstocks to a broader suite of energy forms."
GranBio's Mr Gradin said a long-term alliance with Nuseed would accelerate and improve the agricultural and technological advancement of energy cane worldwide.
Energy cane has been developed by GranBio during the past decade from traditional hybrid plant breeding focused on improving its energy output equation.
The result is a more robust cane with higher fibre content and productive potential, ideal for producing biofuels and biochemicals, and for the generation and cogeneration of bioelectricity.
Nufarm's move into the cane bioenergy business follows the news Maryborough's sugar mill, on Queensland's Fraser Coast, has been sold to an Australian-Japanese consortium looking at use the site to make renewable fuels.
Advanced Energy Group announced in July it hoped to diversify the mill's processing operations and local cane farmland to make use of new energy cane varieties.
Maryborough mill handled its last sugar cane crop in November 2020, ending 126 years of crushing at the site.
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Andrew Marshall
Andrew Marshall is the group agribusiness writer for ACM's state agricultural weeklies and websites. He is a former editor at The Land and has worked in various Rural Press group roles in Canberra, North Richmond (NSW) and Toowoomba (Qld).
Andrew Marshall is the group agribusiness writer for ACM's state agricultural weeklies and websites. He is a former editor at The Land and has worked in various Rural Press group roles in Canberra, North Richmond (NSW) and Toowoomba (Qld).
