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materials by appropriate processing into valuable products that sell at prices exceeding the combined input costs.

Reducing the costs of raw materials will continue to be important. With advances in plant molecular biology, cost reductions will occur by genetic engineering of the source plants to make them better suited for processing or direct use. Large cost reductions for biobased products, however, are more likely to occur through development of effective low-cost processing technologies. Such technologies will be physical, thermal, chemical, biological, informational, and combinations thereof. This section discusses RD&C priorities for raw materials, processing, and products, building on concepts and research needs detailed in earlier chapters. A theme throughout this report is that methods, techniques, and technologies developed for a biobased industry must be both effective and economical. Many technically feasible techniques for processing renewable materials have been developed in the laboratory but have little chance of commercial viability. Providing explicit mechanisms for cooperation between laboratory scientists and process engineers would help avoid this problem and help ensure adoption of effective and economical approaches.

The goal of a biobased system is to be sustainable over time. Sustainability can be partially ensured by designing systems capable of processing a variety of raw materials. This will permit greater regional flexibility to make use of the biomass sources most suited to particular locations. Sustainability also will require careful accounting of all material and energy inputs and outputs into the production and processing system, and assurance that healthy soil—the ultimate production resource for biobased products—will be maintained. Economic and environmental sustainability should be the basis of efforts to improve the raw materials, processes, and products of biobased industries.

Niche Products

Niche products are comparatively smaller-scale products that include novel materials such as bioplastics, fatty acids, and other biopolymers. This market deserves special attention because these are high-value products that do not require large acreages of land. Performance is much more important than price, and product differentiation is high among manufacturers. Particularly important niche products are those yielding significant environmental benefits. ''Big bang" products, in contrast, are generally large-scale commodity materials for which selling price is the key feature and little or no product differentiation exists. Capitalization needs for commercial-scale operations are significantly lower for niche products in comparison to commodity materials.