MARKET PROJECTIONS FOR NANOCELLULOSE-ENABLED PRODUCTS Jo Anne Shatkin, E.M. (Ted) Bilek, John Cowie, and Theodore H. Wegner SWST CONFERENCE JACKSON LAKE LODGE, WYOMING JUNE 7-12, 2015
Compound Growth Forecast: 19% The nanocellulose market is estimated around $250 million in 2014, with the high share held by North America and Europe together. The global nano cellulose market by value is projected to grow at a CAGR of approximately 19% from 2014 to 2019. The high growth is forecasted to be in the North America and Europe due to rising advancements in the end industries such as paper and paper board, composites & packaging, biomedicine in the region. Europe is estimated to have the second highest growth from 2014 to 2019. - RnR Market Research, 2015. 2
Compound Growth Forecast: 19% The nanocellulose market is estimated around $250 million in 2014, with the high share held by North America and Europe together. The global nano cellulose market by value $4,650 is projected to grow at a CAGR of approximately 19% from 2014 to 2019. The high growth is forecasted to be in the North America and Europe due to rising advancements in the end industries such as paper and paper board, composites & packaging, biomedicine in the region. Europe is estimated to have the second highest growth from 2014 to 2019. - RnR Market Research, 2015. 3
Shatkin, Jo Anne, Theodore H. Wegner, E.M. (Ted) Bilek, and John Cowie. 2014. Market projections of cellulose nanomaterial-enabled products Part 1: Applications. Tappi Journal. (May) 13(5): 9-16. http://www.treesearch.fs.fed.us/pubs/46174 Cowie, John, E.M. (Ted) Bilek, Theodore H. Wegner, and Jo Anne Shatkin. 2014. Market projections of cellulose nanomaterial-enabled products Part 2: Volume estimates. Tappi Journal. (June) 13(6): 57-69. http://www.treesearch.fs.fed.us/pubs/46175 4
Objectives Discuss Market Drivers for Nanocellulose Summarize the results of a study on potential markets for nanocellulose Categories of applications Methodology Volume estimates Recommend some future research directions 5
Environmental Market Drivers Consumer/Retailer demand Lightweighting to improve fuel efficiency Energy Efficiency Bio-based materials Greener Consumer Products Carbon Dioxide targets Renewable/compostable Regulatory Café standards Stretch codes; building codes Shopping bag/water bottle bans/additive red-listing EU Directive vehicle recycling Landfill bans/ recycling targets 6
Assumptions Recent research reports/expert network to identify target applications Current market sizes are maintained (no growth) Commercialization within the next 6-11 years Dry yield 40% Cost competitive with current alternatives Technical issues addressed No barrier to adoption 7
HIGH VOLUME LOW VOLUME NOVEL and EMERGING APPLICATIONS Cement Wallboard Facing Sensors medical, environmental, industrial Automotive Body Insulation Reinforcement fiber - construction Automotive Interior Paint-Architectural Water filtration Packaging Coatings Paint-Special Purpose Air filtration Paper Coatings Paint -OEM Applications Viscosity modifiers Paper Filler Aerospace Structure Purification Packaging Filler Aerospace Interiors Cosmetics Replacement -Plastic Packaging Plastic Film Replacement Targeted Applications Aerogels for the Oil and Gas Industry Excipients Organic LED Hygiene and Absorbent Products Textiles for Clothing Flexible Electronics Photovoltaics Recyclable Electronics 3D printing Photonic Films 8
Volume Estimates Volume = M * NC content * MP M = recent market size NC Content = % nanocellulose MP = market penetration rate 9
Example: Nanocellulose Demand for Automotive Bodies ~1.57 T ~2.08 T Cellulose nanomaterial demand = Avg. weight/vehicle * Total vehicles produced * Portion of weight that s steel * Portion of steel that could potentially be replaced * Nanocellulose market penetration * Nanocellulose relative weight proportion [(1.57 tonnes + 2.08 tonnes)/2 x 15.8 million vehicles * 1 / 3 steel/vehicle x 50% steel replacement] x 1 / 2 x 0.65 = 1.56 million tonnes cellulose nanomaterials 10
Example: Textiles CATEGORIES Clothing & Apparel - only Home Textiles Military Textiles Medical Textiles Sport Textiles Technical and Smart Textiles http://www.innovationintextiles.com/smart-textiles-and-nanotechnologiesapplications-technologies-and-markets/#sthash.suaoiybx.dpuf 11
Example: Adding Nanocellulose to Cement Global cement market volume is 3.3 Billion tonnes per year Weight addition of 0.5% CNC (Cao et al. 2013) >> 16.5 million tonnes CNC This study U.S. adoption for ultra-high performance structural cement market prestressed and pre-treated only (5.7 M tonnes cement >> 21,000 tonnes CNC @75% market penetration) 12
100% Estimated Market Penetration Rates - High Volume Applications Low Estimate % Average Estimate % High Estimate % 80% 60% 40% 20% 0% 13
High Volume Cellulose Nanomaterials U.S. Market Penetration Estimates Market and/or Application Thousand Tonnes Per Year Low Estimate Average Estimate High Estimate Packaging Coatings 855 1,140 1,425 Replacement for Plastic Packaging 390 897 1,560 Plastic Film Replacement 364 727 1,091 Hygiene and Absorbent Products 420 700 1,400 Automotive Body 240 320 800 Textiles for Clothing 275 550 825 Paper Filler 310 517 724 Packaging Filler 310 517 724 Paper Coatings 351 468 585 Automotive Interior 81 108 135 Cement 14 21 28 TOTALS 3,610 5,966 9,297 14
2,500,000 Annual U.S Tonnage Estimates for Nanocellulose High Volume Applications 2,000,000 1,500,000 1,000,000 500,000 0 15
Annual Tonnage Estimate by Forest Products Subsector 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 Film Coatings Fiber/plastic replacement Filler 1,000,000 500,000 0 Packaging Paper Wovens 16
High Volume Cellulose Nanomaterials - Potential Applications- World Market and/or Application Low Estimate Average Estimate High Estimate Tonnes (Thousands) Tonnes (Thousands) [1] Global estimates based on GDP, except where noted in the text (Cement, automotive applications, and plastic packaging) [i] United Nations GDP Statistics: http://unstats.un.org/unsd/snaama/dnltransfer.asp?fid=2 17 Tonnes (Thousands) Packaging Coatings 3,958 5,278 6,297 Replacement for Plastic Packaging 1,806 4,153 7,222 Plastic Film Replacement 1,683 3,366 5,049 Hygiene and Absorbent Products 1,944 3,241 6,481 Automotive Body 2,700 3,573 8,950 Textiles for Clothing 1,273 2,543 3,891 Paper Filler 1,437 2,394 3,352 Packaging Filler 1,437 2,394 3,352 Paper Coatings 1,437 2,394 3,352 Automotive Interior 420 587 700 Cement 0 4,130 8,250 TOTALS 18,283 32,829 56,481
Low Volume Cellulose Nanomaterials - Market and/or Application Potential Applications United States All estimates calculated from current market data Global Low Estimate Medium Estimate High Estimate Medium Estimate % Tonnes (Thousands) % Tonnes (Thousands) % Tonnes (Thousands) % [1] Estimates extrapolated from GDP Tonnes (Thousands) Wallboard Facing 25 5.5 50 11.0 75 16.5 50 51 Insulation 2 48 5 120 7 168 5 556 Aerospace Structure 10 0.6 30 1.7 50 2.9 30 8 Aerospace Interiors 50 5 75 7 100 10 75 32 Aerogels -Oil /Gas Industry 25 150 50 300 75 450 50 1,389 Architectural Paint 10 5 25 12 40 20 25 56 Special Purpose Paint 50 12 75 18 75 24 75 83 Paint for OEM Applications 50 6 75 12 100 18 75 56 TOTALS 230 480 710 2,230 [1] Global estimates are scaled up on the basis of Gross Domestic Product 18
Other Market Estimates Report Volume (TPY) Timing Future Markets, Inc. 1 st Ed. (2012) Future Markets, 2 nd Ed. (2012) 21 2017 770 2017 Arbora Nano (2012) 145,000 NA 19
Recent Analysis of Patent Applications for Wood-based Nanocelluloses 10% - Paper Coating 8% - Paper Furnish 22% - Composites 9% - Film [Source Salmenkivi 2013] 20
Alternative U.S. Acreage Estimates of Cellulose Needed* *Assuming 100% from virgin wood pulp Green Tons/ Acre Acres per Year Hectares PLANTATION GROWN TREES 470 176,000 69,000 NATURAL FORESTS 92 906,000 352,000 FOREST RESTORATION THINNINGS 22 3,840,000 1,493,000 21
Next Steps Estimate Novel Application Volumes Refine Estimates Competitive advantage Cost sensitivity Adoption rates Survey for applications Technical issues Time to market Jobs estimates 22
Results depend on the validity of assumptions "I think there is a world market for maybe five computers." - Thomas Watson, chairman of IBM, 1943 "Computers in the future may weigh no more than 1.5 tons." - Popular Mechanics, 1949 "But what...is it good for?" - Engineer at the Advanced Computing Systems Division of IBM, 1968, commenting on the microchip 23