Tag Archives: biotechnology
Biofuel Seed Developer Ceres Looks To Cash In On 16 Years Of R&D
Ceres, which uses advanced plant breeding and biotechnology to make better seeds for biofuels, is working to commercialize its products. Ceres Chief Executive Richard W. Hamilton Richard W. Hamilton, Ceres’ chief executive, says the Thousand Oaks firm’s seeds are superior to those of competitors. (Ceres Inc. / November 3, 2013) By Ronald D. White November 3, 2013, 5:22 p.m. The road to a clean biofuels future is not easily traveled. Ceres Inc. in Thousand Oaks has some highly regarded science on its side as a producer of genetically modified seeds for crops used to make biofuels. Under the motto “Growing tomorrow’s fuel today,” Ceres has used advanced plant breeding and biotechnology to make better seeds for sophisticated versions of crops such as sweet sorghum, high-biomass sorghum, switch grass and miscanthus. Started in 1997 by a UCLA professor and his corporate partners with more than $50 million in private capital, Ceres makes seeds that can be converted into a new kind of ethanol using plant fibers instead of corn kernels or sugar cane. Ceres sells seeds and provides seeds for trials to ethanol mills, including some in Brazil, and to power producers, cellulosic biofuel companies and growers. It also has its own breeding center in central Brazil and on customers’ fields, but it doesn’t refine products into biofuels. Ceres has been and remains a research-and-development company, but it has reached that crucial stage in which it is working to commercialize its products. The company, which raised $74.75 million in its initial public offering last year, has been profitable in only three years: 2003, 2005 and 2006. Richard W. Hamilton, Ceres’ president and chief executive, is looking to better days ahead with what he touts as seeds superior to those of competitors. “From a competitive standpoint, for the second year now, our portfolio of products outperformed products from other seed companies,” he said in a conference call with analysts. “This is according to feedback from mill customers where comparable or side-by-side trials were available.” He would not otherwise comment, a Ceres spokesman said, because the company was in the process of planning for its release of fiscal fourth-quarter results this month. Hamilton joined the company in 1998 as chief financial officer, rising to chief executive in 2002 to replace Walter De Logi, who remained chairman. The Latest For the third quarter, which ended May 31, Ceres reported that it lost $9.3 million, a wider loss than the $8.4 million in the year-earlier quarter. Sales, though, rose to $1.4 million from $1.1 million. The company, which has 96 employees, also said it would cut 17 positions in a cost-saving move. On a more positive note, Ceres extended a joint market development agreement with Syngenta in Brazil, where Ceres has introduced its sweet and high-biomass sorghum varieties to some of that country’s ethanol mills. Ceres is providing seed and research support to the project. Brazil’s ethanol mills operate about 200 days a year, but the use of Ceres sweet sorghum could extend mill operations an additional 60 days a year. Accomplishments The science behind Ceres seeds is highly regarded; it involves a process similar to mapping the human genome, but Ceres was mapping the cellular level of plants. Ceres has 100 U.S. patents related to its research and an additional 200 pending in the U.S. and abroad. The crops have the commercial potential to be sturdier and more productive for biofuel production, analysts said. “These traits include high drought tolerance, high sugar content, nitrogen-use efficiency and increased biomass yields, among others,” Hamilton said. The company’s seeds have given it significant strengths, particularly in comparison with similar products from much larger competitors Monsanto Co. and DuPont Co., said research analyst Caleb Dorfman at Simmons & Co. International. “Since Ceres’ hybrids both outperformed competitors’ hybrids and demonstrated that sweet sorghum can be profitable when cultivated correctly, we believe a large-scale adoption of sweet sorghum is still likely,” Dorfman said. Challenges Even so, Dorfman said in a recent note to investors, “it has been a tough road for Ceres.” He pointed to “lackluster planting and harvest” last year and noted that the “high expectations for the 2013 harvest were crushed” when ethanol mills told Ceres that they would need another year of field trials before deciding whether to proceed with commercial-scale plantings. Ceres said it needs to reduce costs and preserve cash. The company had $37.4 million in cash and marketable securities on hand at the end of the third quarter. “While we continue to believe a capital raise is necessary,” Dorfman said, “these cuts could help delay a cash infusion until market conditions are more favorable.” The company didn’t get as much as it had hoped for in its February 2012 IPO. Originally seeking as much as $23 a share, Ceres ended up going public at $13. Shares have been hovering below $1.50 after hitting a 52-week low of $1.10 last summer. It gained 2 cents, or 1.4%, to $1.48 on Friday. Analysts Despite its challenges, Ceres still attracts some attention on Wall Street. Of seven analysts who regularly cover Ceres, two regard it as undervalued and rate it as a strong buy. Another analyst rates it as a buy for the same reason. Two analysts are hedging their bets and telling investors to hold their Ceres shares. Dorfman considers Ceres “overweight,” meaning he expects the stock to outperform competitors in the coming months. ron.white@latimes.com Continue reading
Food vs. Fuel in 2013
Food vs. Fuel in 2013 By MATTHEW L. WALD Workers harvesting sugar cane in Sertãozinho, Brazil, for use in ethanol production.Agence France-Presse — Getty ImagesWorkers harvesting sugar cane in Sertãozinho, Brazil, for use in ethanol production. In coming days, the Environmental Protection Agency’s to-do list will include setting a standard for the amount of advanced biofuels that refiners will be required to blend into gasoline and diesel supplies in 2013. The question is tricky because production in one category, cellulosic fuel from nonfood sources like corn cobs, stalks, wood chips and garbage, has not met the target set by Congress. The E.P.A. has the authority to adjust the quotas as needed, but the issue is complicated. The quotas were laid out in 2007 when Congress established a renewable fuel standard. Under its targets, production of cellulosic fuel was supposed to hit one billion gallons next year, up from 500 million in 2012, 250 million in 2011 and 100 million in 2010. But so far output is near zero because no one seems to have hit on a commercially successful recipe. So far the E.P.A. has had little choice but to repeatedly waive nearly all of the cellulosic requirement, but this has led to bitter complaints from the refiners, who say they are still required to use small quantities of a fuel that does not exist or face fines. Even as the agency waived most of the cellulosic requirement, it kept intact a larger 2.75 billion-gallon quota for “advanced” biofuels in general, which includes cellulosic, ethanol made from Brazilian sugar cane and biodiesel made mostly from soybeans. Production of biodiesel or sugar-cane ethanol is favored because each process emits relatively little carbon dioxide, the predominant greenhouse gas, meaning it has an advantage on the global warming front. Keeping the quota for advanced fuels intact was more or less O.K. when the agency waived smaller cellulosic mandates, said Jeremy I. Martin, a senior scientist in the Union of Concerned Scientists’ clean vehicles program. But it’s going to be a problem if the agency waives a one billion gallon requirement for 2013, he warned. If the overall 2.75 billion quota for advanced fuels is not reduced, the biodiesel and the sugar-cane ethanol will have to make up the difference. And if that happens, Mr. Martin argues, the quota will start putting more pressure on food supplies. Various other industrial users of food, especially companies that raise chickens, turkeys, hogs and beef, have meanwhile been trying to get the mandate for corn ethanol reduced, but the E.P.A. has declined to do so. The biofuel industry has been pushing hard to maintain the quotas, with waivers for cellulosic fuels as needed, year by year. A new industry report catalogs a growing number of efforts to produce cellulosic biofuels, albeit commercially unsuccessful ones. “All in all, the post-election environment in Washington seems to promise continuation of stable policy support for advanced biofuels commercialization and the robust growth of the industry,” Brent Erickson, executive vice president of the Biotechnology industry Organization said in a letter to supporters this month. Mr. Martin’s theory is that E.P.A. should stay the course. “We’re going to have to accept that the cellulosic fuels are late,’’ he said, but it would be better to delay the quotas than to eliminate them. “Going in the right direction a little more slowly is better than going in the wrong direction,’’ he said. Continue reading
Genetically Modified Yeast Turns Crop Wastes Into Liquid Fuel
By Simon Redfern Reporter, BBC News Growing maize for use as a biofuel is controversial as it can impact food prices US researchers have used genetically modified yeast to enhance the production of biofuels from waste materials. The new method solves some of the problems in using waste like straw to make bioethanol fuel. The scientists involved say the development could help overcome reservations about using land for fuel production. The research is published in the journal Nature Communications. Many states around the world have plans to replace gasoline with bioethanol, but this has typically been by changing land-use from food crops to biofuel. Just this week, a representative of South Africa’s farming community announced that sorghum harvests would need to increase five fold to meet their government’s commitment to incorporate at least 2% bioethanol in petrol. Sorghum is South Africa’s second biggest summer crop and is a staple food as well as being used in brewing and livestock feed. However, scientists are now seeking more sustainable routes to generating biofuel – routes that would have a lighter impact on food prices and production. Breakdown breakthrough One is to consider using non-conventional plants such as seaweed. But among the most radical ideas is the suggestion that biowastes should be used to produce bioethanol, which is added to petrol replacing some fossil fuel. “Wastes present a major opportunity in this respect. We have to start to think about wastes, such as sewage or landfill waste as resources – not problems to be disposed of,” Dr Gavin Collins, an environmental microbiologist at the National University of Ireland, Galway, told BBC News. Using microbes to make fuel from biomass involves breaking down large complex biopolymer molecules. These are indigestible to most bugs, and attempts to incorporate them into fuel production have slowed down the biotechnology, creating bottlenecks. Biofuel boom The European Union also has a declared aim that 10% of its transport energy should be from renewable sources, such as biofuels, by 2020. To help meet this target, Europe’s largest biofuel plant opened this week at Crescentino, Italy. It is designed to generate 75 million litres of ethanol a year from straw and a crop called Arundo donax, which can be grown on marginal land, and does not compete for resources with food. One chemical that is produced when processing biowastes is a large sugar molecule called xylose. When you try and use yeast to ferment xylose, rather than making alcohol for fuel directly, it generates acetic acid – essentially vinegar. This is poisonous to the yeast, and stops the fermentation. Breaking down xylose and making acetic acid non-toxic are the two major problems that must be solved if biowastes such as straw are to be fermented to make fuel. Now, US biotechnologists appear to have solved both problems, by developing a genetically engineered strain of yeast that simultaneously breaks down xylose and converts acetic acid to fuel. “Xylose is a sugar; we can engineer yeast to ferment xylose,” said University of Illinois Prof Yong-Su Jin, one of the authors of the study. “However, acetic acid is a toxic compound that kills yeast. That is one of the biggest problems in cellulosic ethanol production.” The yeast digests the sugars in oxygen-poor conditions, making the process more efficient than digesters that rely on active mixing of air into the system. Microbe driven A new pathway, not yet discovered in nature, has been genetically engineered in the lab. This breakthrough means yeasts can be used much more efficiently to convert biowaste into biofuel. “We sort of rebuilt how yeast uses carbon,” said principal investigator Dr Jamie Cate, of the University of California at Berkeley One hurdle to implementing the discovery is that the new yeast that has been developed is genetically modified, and it is not yet clear how easily GM yeasts might be accepted for use on an industrial scale. Dr Gavin Collins, however, remains upbeat about the prospects for biotechnology. “We probably know the function of only about 0.01% of all living microbes on Earth,” he said. “It may be that many of them can efficiently degrade even complex plant material and other wastes under anaerobic conditions. They may be present in nature but we haven’t found them yet. “However, just look at what we have been able to do with the small fraction of microbes we understand – everything from antibiotic production; food and alcohol production; and biofuel production. “Just think what we could do, or what we might discover, if we understood the function of just another 1%.” Continue reading
