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How much are bio-based products worth to the US economy?

Posted on Oct 27, 2015 2:00:00 PM

Jonathan Cobb's farm with cover crops (Courtesy of USDA)"This report is the first to examine and quantify the effect of the U.S. bio-based products industry from an economics and jobs perspective..."

A report has showcased exactly the value of the growing bio-based industry in the US both in terms of financial benefit and also job creation. The report, made for Congress, shows that the US bio-based products Industry Contributes $369 Billion and 4 Million Jobs to American economy. The publication of the report also saw an announcement from US Agriculture Secretary Tom Vilsack regarding changes under the 2014 Farm Bill aiming to create additional opportunities for growth in renewable plant-based materials, supporting the Obama Administration's efforts to develop a new, rural economy and promote creation of sustainable jobs.

The report defined a bio-based product as “A product determined by USDA to be a commercial or industrial product (other than food or feed) that is: (1) Composed, in whole or in significant part, of biological products, including renewable domestic agricultural materials and forestry materials; or (2) An intermediate ingredient or feedstock.”

"This report is the first to examine and quantify the effect of the U.S. bio-based products industry from an economics and jobs perspective. Before, we could only speculate at the incredible economic impact of the bio-based products industry. Now, we know that in 2013 alone, America's bio-based industry contributed four million jobs and $369 billion to our economy," Vilsack said. "Today, we are also adding to the number of innovative products carrying USDA's BioPreferred® label and expanding options for our nation's bio-refineries. This means small businesses and global companies alike can continue to harness the power of America's farms and forests to create new and innovative bio-based products that are used all around the world."

According to the Economic Impact of the Bio-based Product Industry report, each job in the bio-based products industry is responsible for generating 1.64 jobs in other sectors of the economy. In 2013, 1.5 million jobs directly supported the bio-based product industry, resulting in 1.1 million indirect jobs in related industries, and another 1.4 million induced jobs produced from the purchase of goods and services generated by the direct and indirect jobs.

The report builds on the " Why Biobased?" report released by the USDA in October 2014. Estimates are that the use of biobased products currently displaces about 300 million gallons of petroleum per year - equivalent to taking 200,000 cars off the road.

The Secretary also announced changes to include new forest products in the BioPreferred program, along with proposed changes to the former Bio-refinery Assistance Program to assist in the development of cutting-edge technologies for advanced biofuels, renewable chemicals, and bio-based product manufacturing.

The final BioPreferred® program rules will no longer exclude mature market products (those that had a significant market share prior to 1972), providing consumers with more innovative wood products and other materials carrying USDA BioPreferred® label. Forest products that meet bio-based content requirements, notwithstanding the market share the product holds, the age of the product, or whether the market for the product is new or emerging, also now meet the definition of "bio-based product."

The report found that the seven major overarching sectors that represent the U.S. bio-based products industry's contribution to the U.S. economy are: agriculture and forestry, bio-refining, bio-based chemicals, enzymes, bioplastic bottles and packaging, forest products, and textiles.

The study also includes location quotients by state to show the impact of the industry on individual states. Seven case studies are presented from stakeholders such as The Coca-Cola Company and PlantBottle packaging, Patagonia, and Ford.

Read the full report here: An Economic Impact Analysis of the U.S. Bio-based Products Industry

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Bio-Based World News Staff
Bio-Based World News Staff