ENTOLAB-loppuseminaari: hyönteiskasvatuksen edistäminen Etelä-Pohjanmaalla 4.12.18 Seinäjoki

1. FORMING AN INSECT INDUSTRY AGAINST A
BACKGROUND OF REGULATORY AND
TECHNOLOGICAL UNCERTAINTY
NJF. Nordic seminar on insects for food, feed and circular economy
Seinäjoki 06.12.2018
Ivar Pettersen, Norwegian Institute of Bioeconomy Research

2. 1. Assume that industrial insect rearing is all about a circular bioeconomy
2. Take into regard Knightian uncertainty
3. And you’ll have an indication of the risks involved in industrial insect
rearing,
and the risk governance required
19.12.2018 2NIBIO
FORMING AN INSECT INDUSTRY UNDER
UNCERTAINTY

3. ALL ABOUT A CIRCULAR BIOECONOMY
– Ideal
– Realistic
– In practice
19.12.2018 3NIBIO

4. IDEAL CIRCULARITY
19.12.2018 4NIBIO

5. Bio-
energy
Animal nutrition (Proteins, Carbohydrates, lipids)
Plant nutrition (N, K, P)
Plant product
and wild fish
harvesting
Plant/ Primary
product
processing
Finnished
product
distribution
Consump
-tion
Biomass
processing
Product
distribution
Biomass
consoli-
dation
CO2 (Photosynthesis)
Use
Reuse /
recycle

6. REALISTIC CIRCULARITY
19.12.2018 6NIBIO

7. Plant product
and wild fish
harvesting
Plant/ Primary
product
processing
Finnished
product
distribution
Consump
-tion
Biomass
processing
Product
distribution
Biomass
consoli-
dation
Bio-
energy
Animal/ human nutrition
(Proteins, Carbohydrates, lipids)
Plant nutrition (N, K, P, …)
CO2 (Photosynthesis)
Energy
Inorganic
fertilizer
Chem./bio
pesticdes &
insectides
Acids /bases
Micro-
organisms
Fungus
Insects etc.
Enzymes
Other
catalyzers
Contami-
nants

8. CIRCULARITY IN PRACTICE
19.12.2018 8NIBIO

9. IN PRACTICE:
THE BIOMASS – LOGISTICS MATRIX
19.12.2018 9NIBIO
Low 2 3 High
High
3
2
Low
Attractiveness of Biomass
Logisticattractiveness
Reuse Transform Waste Transform /waste
Technologies
Logistics and biomass characteristics

10. IN PRACTICE:
THE BIOMASS – LOGISTICS MATRIX
19.12.2018 10NIBIO
Low 2 3 High
High
3
2
Low
Attractiveness of Biomass
Logisticattractiveness
Reuse Transform Waste Transform /waste
Technologies
Logistics and biomass characteristics

11. Use
Reuse
Recycle human and
animal nutrition
Recycle energy and
plant nutrition
Final waste
Plant farming/
bio-harvest
Process
Ordinary food, feed processing
(e.g. heat, separate, mix,
extrude, conserve)
Collect,
stabilize,
Drain
Distribute Consume
Certify
Hydro-
thermal
hydrolysis
Biogas
(anaerob
ferm.)
Inciner-
ation,
deposit
Compost-
ing
(aerob
ferm.)
Hydroly-
sis, other
Meta-
bolism
Pharma /
comsmetics
Protein
concentrate
Purified
lipids
Soil-
conditioner /
Fertilizer
Energy
Food
Feed
Fraction
Separate
Stabili-
zation,
finnishing
Certify Supply
Safe
deposits,
landfills

12. Technology
Hindrances
(characteristics)
Drain
Acid/base
treatm./silage
Thermal
treatment
Microorg,
methabolism
fungus
Insectsetc.
Hydrolysis
Multi-stage
biorefining
Hydro-
thermal
Acid/
base
Enzy-
matic
Aerob
An-
aerob
water
ph
Biol. active
Low digestab
Patogenes
Prions (TSE)
Genes
Plastic
Chem./ metal
contamin.
Inadequate/ irrelevant technologies
Adequate
Uncertain /Insufficiently researched

13. MULTI STAGE
BIO-REFINING:
SAW-DUST INTO
PROTEIN
Prehydrolysis
(hydro-thermal
pretreatment)
Cooking
Hemi-Cellolose
extract
Pulp
Hydrolysis
Mono-sugars Single cell protein
Saw-
dust
Fish-
feed
protein
Lignin
Nitrogen
and
nutrients
Mineral
acid
Enzymes
Catalysts
Biomass input
Process additives
Final products

14. 1. All about a circular bioeconomy
2. Take into regard Knightian uncertainty
– Governance
– Technology
3. And you’ll have an indication of the risks involved in industrial insect
rearing,
and the risk governance required
19.12.2018 14NIBIO
FORMING AN INSECT INDUSTRY UNDER
UNCERTAINTY

15. FORMING AN INSECT INDUSTRY UNDER UNCERTAINTY:
GOVERNANCE
– Market driven or politically
incentivized
– Technology based or
efficiency oriented
– Evidence based or
precautionary
– Open or closed system
19.12.2018 15NIBIO
– Is effective climate change mitigation sufficient?
– Should we subsidize biogas production or insect
rearing?
– What technologies are most socially valuable?
– Is the strength of demand for technological
solutions sufficient?
– Are regulations continously adapted to new
knowledge and technological shifts?
– Will EEA Governance differ from international
regulations ?
– Will trade policy implications from differing
Governance be accounted for?
– Are actions taken to implent Trade Facilitation and
border procedures according to food safety
regulations?
May be they should!
No:
- climate mitigation first
- then, technology neutral regulation
Little clarity on priorities
Efficiency before effectiveness
No, for political and beuracritic
reasons
Certainly
Probably not, especially in Norway
No, evidently

16. FORMING AN INSECT INDUSTRY UNDER UNCERTAINTY:
TECHNOLOGIES
– The competitiveness of technologies
– The shifting competitiveness
– New technologies
19.12.2018 16NIBIO

17. FORMING AN INSECT INDUSTRY UNDER UNCERTAINTY:
THE COMPETITIVENESS OF TECHNOLOGIES
19.12.2018 17NIBIO
Unit cost
(upgraded product)
Organic waste ranked
by attractiveness
Alterntive combinations of technologies and
types of organic waste

18. FORMING AN INSECT INDUSTRY UNDER UNCERTAINTY:
THE COMPETITIVENESS OF TECHNOLOGIES
19.12.2018 18NIBIO
Unit cost
(upgraded product)
Organic waste ranked
by attractiveness
Alterntive combinations of technologies and
types of organic wasteRelative competitveness may shift due to:
- Volume composition of organic waste
- Regulations
- Technologies on
- Verification
- Processing / bioconversion / transformation
- Catalyzing
- Genetic modifcation
- Protein selection

19. KNIGHTIAN UNCERTAINTY
– Frank Knight (1921) Risk differs from Uncertainty.
– insufficent information to assess risks
– Revived by the economic crisis of 2008
– Cause irrational behaviour (Caballero, 2010)
19.12.2018 19NIBIO

20. 1. A circular concept that is visionary, not specific on how and where
2. Which contributes to Knightian uncertainty
– Climate change mitigation is unclair and politically insufficient
– Measures are not technology neutral?
– Technology and waste composition changes fast
3. And you’ll have an indication of the risks involved in industrial insect
rearing,
and the risk governance required
19.12.2018 20NIBIO
FORMING AN INSECT INDUSTRY UNDER
UNCERTAINTY

21. 1. A circular concept that is visionary, not specific on how and where
2. Which contributes to Knightian uncertainty
– Climate change mitigation is unclair and politically insufficient
– Measures are not technology neutral?
– Technology and waste composition changes fast
3. Providing an indication of the risks involved in industrial insect rearing,
and the risk governance required
19.12.2018 21NIBIO
FORMING AN INSECT INDUSTRY UNDER
UNCERTAINTY

22. 19.12.2018 22NIBIO
Feed
Methane
The competition for
valuable carbons

23. 19.12.2018 23NIBIO
Feed
Methane
The competition for
valuable carbons
The obsolete
expansion path
Carbon goes to feed
Carbon goes to methane
The outcome relies on:
- Regulations
- Available organic masses
- Technologies
- And relative world market prices for
food/ feed and energy
And it may shift rapidly and frequently

24. DAGENS RÅVAREPRISER LITE INSPIRERENDE
MAIS, HVETE
OG SOYA PÅ
HISTORISK LAVE
NIVÅER
19.12.2018 24NIBIO

25. 1. A circular concept that is visionary, not specific on how and where
2. Which contributes to Knightian uncertainty
– Climate change mitigation is unclair and politically insufficient
– Measures are not technology neutral?
– Technology and waste composition changes fast
3. Causing the industry to face a future of volatile profitability due to
competion for valuable carbons
and the risk governance required
19.12.2018 25NIBIO
FORMING AN INSECT INDUSTRY UNDER
UNCERTAINTY

26. 1. A circular concept that is visionary, not specific on how and where
2. Which contributes to Knightian uncertainty
– Climate change mitigation is unclair and politically insufficient
– Measures are not technology neutral?
– Technology and waste composition changes fast
3. Causing the industry to face a future of volatile profitability due to
competion for valuable carbons
and requring conscious risk governance
19.12.2018 26NIBIO
FORMING AN INSECT INDUSTRY UNDER
UNCERTAINTY

27. FORMING AN INSECT INDUSTRY UNDER UNCERTAINTY
CONSCIOUS RISK MANAGEMENT
19.12.2018 27NIBIO
Risk
Probability
Impact
Risk management
- Increase the value
(Technology, knowledge,
governance)
- Get risk ownership right;
state versus enterprise
- Organize vertically

28. 1. Too much vision only, too little effectiveness?
2. Does the insect sector need more insight on
– Governance for circularity and climate change mitigation and adaption
– Technological change
– Global market volatility?
Are these issues worthwhile prioritizing?
3. Does the insect industry share a general need for new solutions on
– Risk sharing in public – prvate partnerships
– Risk sharing along the supply chain?
19.12.2018 28NIBIO
FORMING AN INSECT INDUSTRY UNDER
UNCERTAINTY

29. 1. Too much vision only, too little effectiveness?
2. Does the insect sector need more insight on
– Governance for circularity and climate change mitigation and adaption
– Technological change
– Global market volatility?
Are these issues worthwhile prioritizing?
3. Does the insect industry share a general need for new solutions on
– Risk sharing in public – prvate partnerships
– Risk sharing along the supply chain?
19.12.2018 29NIBIO
FORMING AN INSECT INDUSTRY UNDER
UNCERTAINTY
My hypothesis is: «Yes, we do!»
But we need empircally based
valuations