Q: What is the role of bio-based product business in Bangchak group?
A: For the strategy of bio-based product business, it was from the fact that Bangchak recognized the importance of sustainable business to create a good quality of life for consumers. Hence, we are committed to use the technology which can help create bio-based products that meet consumers’ needs such as the current business of biofuels or the expansion of bio-based products to be more value-added in which this would help create more values to agricultural sector, the core sector of the country. In addition, such strategy leads to the knowledge development through working together with research agencies from public and private sectors including universities. Such knowledge can be adopted into the creation of high-value bio-based products and being the important role in the technology development to grow at the industrial level and also to increase the country's competitiveness.
Q: Khun Kittipong, could you tell us about the trends of biodiesel and ethanol businesses in 2021?
A: The biodiesel business has grown on the basis of ensuring energy security and supporting the use of palm oil from the country's agricultural sector while the government's policies play the important role in driving the industry. The major factors for this business as follows;
- Proportion of biodiesel blended in diesel fuel in which the government has already announced to use B10 in 2021.
- The diesel demand for the whole country which has been slow down due to the COVID-19 epidemic for the short term as well as a tendency of EV (Electric Vehicle) in the next 10-20 years but diesel would still be a base oil for the transportation sector.
However, BBGI has prepared for the changes that may occur. In the short term, the production and cost management efficiency have been improved as well as the new value-added product development has been done in order to increase competitiveness. The company has invested in refined glycerin plant to increase the value of B100 byproducts and has started its commercial production since January 2021. BBGI also has cooperated with several sectors to develop high-value products building on the biodiesel industry.
For the ethanol business in 2021, it will be affected by 2 factors including;
- The higher raw material price because of the amount of crushed sugarcane decreasing the most in 10 years with only 66 million tons (from 75 million tons in 2020). Hence, the amount of molasses reduced and the price became the most expensive in 10 years, leading to the higher ethanol price this year.
- The impact of the COVID-19 epidemic led to the lower fuel demand in January and is expected to be low in May as well.
However, BBGI has managed to deal with both factors. Regarding the raw material, the company has been preparing molasses since last year, so we were able to secure the sufficient raw material at a better price this year. For the lower demand, BBGI has adjusted the production plan by shifting the machinery maintenance schedule from December 2021 to May 2021. Moreover, there has been increasing demand for premium-graded ethanol used in sanitizing product production during the COVID-19 epidemic, all in all the overall performance of ethanol this year is expected to remain good although it would be slightly weakened from last year.
Q: How do you think the “innovation” will play an additional role in the bio-based product business?
A: The innovation will be engaged in the knowledge development of technology and manufacturing in which BBGI has applied to both existing and new businesses. For example, BBGI is a joint venture between Bangchak Corporation Public Company Limited (BCP) and Khon Kaen Sugar Industry Public Company Limited (KSL) with the objective of developing a new high-value bio-based business by applying modern innovations in knowledge development as well as innovation expansion for the Bangchak Group so that they could acquire new businesses or products which could also be produced in the industrial scale. In addition, we have also cooperated with partners for the technology transfer to Thailand which would lead to the company's growth and benefit the country’s economy.
Q: What has BBGI done lately?
A: We have started to invest in startup companies involving in new innovations and technology development in synthetic biology (SynBio) for the creation of knowledge, technology which could lead to commercialization. BBGI's investment in Manus Bio Inc. in the United States who is the world’s leader in SynBio. With this, biotechnology is used in producing high valued bio-based products such as flavor & fragrance products as well as sweeteners. In addition, BBGI has been collaborating with public research agencies and universities to develop their products for a commercial business. At the same time, BBGI has started marketing the modern biotechnology SynBio products for entrepreneurs’ and consumers’ awareness in Thailand and Southeast Asia.
Q: As BBGI has started in SynBio technology business, would you please tell us about it, including the future plans?
A: BBGI's SynBio technology business was from our corporate strategy to produce high-value bio-based products that promote the consumers’ health and well-beings. The strategy will also be expanded to food supplement and other bio-based products that are environmental-friendly.
Manus Bio Inc, a global leader in SynBio, and BBGI have planned to build a SynBio plant in Thailand under the operation of WIN Ingredients Co., Ltd. It will be Thailand’s first SynBio technology platform factory by using the innovations from Manus Bio and biotechnology expertise from BBGI. BBGI and Manus Bio have entered into an agreement of establishment of their joint venture in October 2020 to marketing and distributing of sweeteners such as “Reb M”. The data gathered from the process will help determining the size and production capacity of the factory. Regarding the production capacity, both companies have plans to support the production of various bio-based products. The details about the construction of the factory will be announced in the middle of 2022.
In addition, BBGI has expanded its business plans for other high-value bio-based products. This led to the work with researchers from universities and research institutes involving in SynBio technology to produce products that can dissolve pesticides in fruits and vegetables for both household and industrial level. This will help improve people’s quality of living as well.
Q: As BBGI will be listed on the Stock Exchange of Thailand, could you update the progress?
A: Currently, BBGI is preparing the draft prospectus with the plan to file in Q3/2021, The initial public offering (IPO) is expected to be done in Q1/2022.
Mr. Kittiphong Limsuwannarot
Senior Executive Vice President
BBGI Public Company Limited