Our vision is to transform industries beyond fossil fuels
UPM Biochemicals, a division of UPM, is a global leader in chemicals. The company leverages its extensive knowledge and expertise in sustainably sourced renewable wood biomass to create innovative and sustainable biochemical solutions. UPM Biochemicals is dedicated to replacing fossil-based raw materials with wood-based renewable biochemicals, offering high-quality, competitive alternatives that contribute to a more sustainable future.
Central to UPM Biochemicals’ strategy is the construction of a pioneering biorefinery in Leuna, Germany, set to begin operations by the end of 2024. This state-of-the-art facility will produce bio-monoethylene glycol (BioMEG), bio-monopropylene glycol (BioMPG), and lignin-based renewable functional fillers (RFF). These products are designed for use in a wide range of industrial and consumer applications, such as PET bottles, packaging materials, rubber products, and textiles. UPM Biochemicals’ commitment to sustainability is evident in its rigorous sourcing standards, ensuring all wood used is FSC or PEFC certified and fully traceable, preserving biodiversity and natural ecosystems.
UPM Biochemicals’ dedication to innovation and sustainability aligns with its broader corporate goals, including ambitious emission reduction targets and contributions to the UN’s Sustainable Development Goals. By sourcing raw materials responsibly and developing renewable, recyclable products, UPM Biochemicals addresses global challenges such as climate change and resource scarcity, positioning itself as a key player in the transition towards a circular economy.
In an interview with Fibre2Fashion, Christian Hübsch, Director, Sales & Marketing at UPM Biochemicals discusses the company’s long-term vision for sustainable chemistry, innovative product developments, adaptation to market trends, cutting-edge technologies, R&D efforts, CSR initiatives, sustainable supply chain practices, industry regulations, and more.
How is the biochemicals industry addressing the growing demand for sustainable and eco-friendly products, and what challenges does it face in implementing these practices?
Firstly, we see significant investments from the biochemical industries into production capacity due to the ever-increasing demand for bio-based solutions. These investments complement other sustainability options, such as using recycled raw materials, to meet the goals of many brands. These goals are typically expressed in terms of achieving a net zero carbon footprint or incorporating certain shares of bio-based or recycled raw materials by 2030 or 2040. A key element in helping brands achieve these targets is investing in production capacity. We observe a lot of activity, particularly in Asia, where sustainable packaging materials like polylactic acid are being produced in several million tons. Additionally, investments in biochemicals are being announced in Europe and other parts of the world.
Another important aspect is broadening the feedstock basis for biochemicals. Initially, the focus was on corn or cane-based sugar. Now, the industry is looking much more broadly at waste products from various processes or, as in our case, lignocellulosic biomass that is sustainably sourced. These efforts help address the growing demand for sustainable and eco-friendly products, although challenges such as ensuring consistent supply, meeting regulatory requirements, and achieving cost-effectiveness remain.
How does the regulatory landscape affect the biochemicals industry, and what strategies can companies employ to navigate complex regulations while fostering innovation?
Regulation is critically important for us, even though the biochemical sector is far less regulated compared to the biofuel sector. Still, important regulations, either under development or already in place, will affect the markets for bio-based chemicals. One example is the Packaging and Packaging Waste Directive, which mandates certain shares of recycled materials in packaging solutions. Currently, bio-based solutions are not considered in these mandates, and we are advocating for bio-based solutions to be included towards these goals as well.
Another important regulation is related to the carbon footprint of products imported into Europe. Most prominently, the Carbon Border Adjustment Mechanism (CBAM) aims to put a tax on carbon-intensive products imported into the European Union. This is particularly relevant for us as a future producer of monoethylene glycol (MEG) for textiles. A large part of fossil-based MEG today is produced in China, still based on coal, with devastating environmental impacts. It is crucial that regulatory bodies ensure such practices are penalised to a certain extent and that consumers are made aware of how their clothing, for example, is produced.
To navigate these complex regulations while fostering innovation, companies can employ several strategies. These include staying informed and engaged with regulatory developments, actively participating in industry advocacy groups, investing in sustainable and compliant technologies, and maintaining transparent communication with stakeholders about their sustainability practices and regulatory compliance.
Can you share UPM Biochemicals’ long-term vision and strategic goals, especially in the context of sustainable and renewable chemical solutions?
Our vision is to pioneer sustainable chemistry and, by doing so, transform industries beyond fossil fuels. In other words, one of our key goals is to make significant progress in sustainable chemistry and revolutionise entire industries by innovating chemical processes. We aim to scale up these processes, radically reducing society’s environmental footprint, and providing truly sustainable choices to consumers.
What are some of the most innovative products UPM Biochemicals is currently developing, and how do they contribute to a sustainable future?
We have been active in sustainable chemicals for quite a while, particularly in the field of lignin, a constituent of wood and a versatile material for a broad range of applications. It is, however, less known in the fibre and textile industries except as a pigment-dispersant in in textile dyeing. Currently, we are building a wood-based biorefinery in Leuna, Germany. The main products from this facility will be monoethylene glycol (MEG), a key component in polyester-based products, including polyester fibres, and renewable functional fillers, which can be used in various plastics and rubber applications. These products are all derived from sustainably sourced biomass, not from oil or fossil raw materials. Their key feature is the dramatic reduction of the carbon footprint in all systems or formulations they are part of. These products will even start with a negative carbon footprint cradle-to-date, thanks to the inclusion of biogenic carbon and the use of renewable electricity.
How is your company adapting to current market trends and consumer demands for eco-friendly and sustainable products?
Firstly, I can confirm that there is a very strong interest in sustainable solutions across many industries, from automotive to textiles and footwear. For raw material suppliers like UPM Biochemicals, it is critically important to develop a thorough understanding of the entire value chains in which we operate. This allows us to address the specific needs of all players, not just our direct customers. For us, this means spending a lot of time talking to end customers and brand owners who have a strong interest in receiving firsthand information about the sustainability attributes of the raw materials used in their products.
Are there any cutting-edge technologies or processes that you are investing in to enhance product performance?
As someone with a technical background, I enjoy discussing technology. In fact, many of the technologies we will apply at our biorefinery are new to the world, meaning they have never been used at full industrial scale before. What they all have in common is that they are significantly more efficient, especially in terms of product yield and energy efficiency, compared to current technologies.
A prime example is our monoethylene glycol (MEG) technology, which uses a catalytic process to convert sugars directly into MEG in a single step. This is in stark contrast to the current industry process, which is very complicated and inefficient. The traditional process converts sugars into ethanol and then, through a two-step process, ultimately produces MEG. Our method achieves a much higher yield and has a significantly lower environmental impact.
Could you discuss any recent or significant partnerships or collaborations that UPM Biochemicals has entered into, and how they are driving innovation and growth?
Partnerships are absolutely critical for us because they create confidence in UPM Biochemicals as a supplier and foster trust among other industry players. They also help raise awareness of UPM Biochemicals.
On the textile side, you are probably aware of our cooperation with VAUDE, a sustainable and innovative supplier of outdoor apparel, and you may have also seen the demonstrator fleece jacket we developed in partnership with them last year. Another one from our sister-business inside UPM Biorefining is with German workwear producer KOX. KOX has recently launched protective trousers for woodworking based on bio-attributed Dyneema fibres. There are many more partnerships in the textile industry, particularly with big brand owners in sportswear, outdoor fashion, and footwear, which are not yet public.
In addition to our work in textiles, I would like to highlight our recent partnership with Nokian Tyres, a well-known brand in the automotive and tire industry. We launched this collaboration in July 2024, focusing on producing more sustainable tyres using one of our key products from Leuna, our Renewable Functional Fillers. This partnership exemplifies how we are driving innovation and growth across various industries.
Can you provide insights into R&D efforts and how they are influencing the future direction of the company?
As a technologist by training, I could give a lengthy answer, but I will try to be brief. We essentially split our R&D efforts into four distinct parts. The first part focuses on process development, aiming to make our processes more efficient and effective to further improve the environmental performance of our existing products. The second part involves enhancing the performance of our products to access a broader range of applications than we currently can.
An often overlooked but critically important aspect is what we refer to as application development. It is not enough to simply provide a material to our customers and wish them luck in using it. We invest significant time and resources into developing application know-how to enable our customers to use our products most effectively across all application fields, including textiles.
Lastly, as a future-oriented company, we explore completely new technologies that are new to the world, targeting the next, and even the second-next, generation of products. Starting early is crucial, as a ten-year lead time is not unusual for such innovations.
How does UPM Biochemicals integrate corporate social responsibility into its business model, and what are some notable CSR projects or achievements?
CSR is a key topic for UPM as a corporation and for UPM Biochemicals specifically. Notably, our activities on the supply chain side reflect our commitment to ethics and sustainability. We maintain very strict standards for all suppliers, demonstrated through our cooperation with EcoVadis Ratings, which we believe is the world’s most trusted global sustainability rating company. EcoVadis has rated over 130,000 companies, and we require all our suppliers to join the EcoVadis rating system.
You may have seen that UPM has achieved platinum status with EcoVadis, the highest rating possible. Less than 1 per cent of all companies rated have achieved this status, highlighting the importance we place on this topic. At UPM Biochemicals, we live this commitment every day.
Our commitment to CSR is a fundamental part of our identity and differentiation. For example, regarding the sourcing of our key raw material, wood, we ensure that all the wood used in our biorefinery is sustainability certified, either through PEFC or FSC. This is crucial as brands are very much interested in sustainability and are unwilling to compromise on the raw materials used in their products. We are proud to uphold these high standards and make sure they are a core part of our operations.
How do you ensure the sustainability and efficiency of your supply chain, from raw materials to final product delivery?
Ensuring sustainability and efficiency in our supply chain involves rigorous supplier ratings and certifications to maintain a 100 per cent closed chain of custody. This is crucial to ensure that all raw materials we source come from sustainable sources, particularly when sourcing wood.
We make absolutely certain that no wood comes from illegal logging, no tropical hardwood is used, and there is no deforestation. Additionally, preserving biodiversity is the highest goal of all our forest management activities. This approach extends to all chemical raw materials and the energy we use for our processes.
All these elements must be sustainability certified, allowing us to have our products rated according to well-known sustainability schemes like ISCC Plus. This comprehensive approach ensures that every step of our supply chain adheres to the highest sustainability standards.
Do you have any expectations from the German government for the textile industry, especially regarding chemicals?
First of all, I would say that I am a strong believer in free and non-regulated markets, which essentially means that we need to be convincing enough to be successful, even without regulation. One key element in our case is to make consumers aware of how their products are made and where they ultimately come from. This also applies to textiles, which are largely made from polyester derived from the bottle recycling loop.
It raises questions about the sustainability and ethics of extracting material from the bottle recycling stream, which has an established and well-functioning infrastructure in Germany, to make textiles. This practice leads to a situation where bottle manufacturers need to purchase virgin material because there is not enough recycled material available. Therefore, we expect the government to support transparency and consumer awareness regarding the origins and production processes of textile materials.
