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Bioproduct income down over three years: StatsCan

The number of Canadian firms making bioproducts such as biofuels and fibreboard rose slightly from 232 to 239 between 2003 and 2006, but bioproduct revenues and the number of people employed in such work declined, according to Statistics Canada.

In 2006, 3,974 people were employed with responsibilities for bioproducts, down almost half (49 per cent) from 2003, the federal statistics agency said in a release Thursday. In 2006, 40 firms reported 50 or more employees, down from 76 firms in 2003.

Total bioproduct revenues declined from $3.1 billion in 2003 to $1.8 billion in 2006 (current dollars). Spending on bioproducts research and development also fell from $96 million to $81 million.

Bioproduct firms develop or produce bioproducts using biomass or other renewable or sustainable feedstocks/materials. Bioproducts are products other than food, feed and medicines developed from biological or renewable material that can come from agricultural, forestry, marine and industrial/municipal sources.

The most familiar bioproduct is ethanol made from corn or wheat. However, bioproducts include a wide array of products such as biochemicals, biopesticides, bioplastics and fibreboard.

In 2006, just over half (51 per cent) of the firms reported becoming involved in bioproducts as a result of internal activities, while 23 per cent had bioproduct interests arising from collaborations, mergers or acquisitions.

Mostly from farms

Agricultural biomass (renewable plant or animal material) was the most commonly used input for Canadian bioproduct firms. Firms reported that on average 45 per cent of their biomass in 2006 came from agricultural sources, more than double the next most prevalent source, forestry biomass, at 22 per cent.

The biggest benefit cited for bioproducts in 2006 was addressing environmental issues. Also cited was the benefit of bioproducts in reducing production costs.

The highest-rated barriers in developing or producing bioproducts in 2006 were the higher prices and transportation costs of biomass and difficulties entering the commercial marketplace.

Bioproduct firms raised funds totalling $219 million in 2006, primarily for research and development, production/manufacturing capability, and marketing/commercialization. Contributions mainly originated from private placements, government grants and Canadian venture capital.

In addition, 48 per cent of firms applied for benefits for bioproduct-related activities under the Scientific Research and Experimental Development (SR+ED) tax program between 2002 and 2006. Applications amounted to just over $33 million in 2006.

Note: Statistics Canada has conducted two surveys to date which produce a profile of firms engaged in the development or production of bioproducts in Canada. This study is a comparative analysis based on data from the Bioproducts Development Survey (2003) and the Bioproducts Development and Production Survey (2006). Firms selected from Statistics Canada’s Business Register had revenues in excess of $250,000. Firms drawn from lists provided by external sources had a minimum of $100,000 in research and development expenditures and at least five employees. Excluded from the survey were not-for-profit organizations, universities, government laboratories, hospitals, and firms that provide only services, such as contract research organizations or consulting firms.

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