Bioeconomy and Industrial Biotechnology

What is the bioeconomy?

The bioeconomy refers to the sustainable production and conversion of biomass for a range of food, health, fibre, and other industrial products as well as energy. The bioeconomy encompasses all industries and sectors producing, managing or otherwise making use of biological resources (including  organic waste), such as agriculture, forestry, and fisheries. The modern bioeconomy is based on knowledge and innovation in biosciences, together with other technologies such as engineering, chemistry, computer science and nanotechnologies.

The idea of a modern, global, competitive and dynamic knowledge-based bioeconomy was established in 2000 at the Lisbon Summit held by the European Union (EU). The EU 2020 Strategy, announced in 2010, includes the bioeconomy as an important component of the Strategy’s three main priorities of:

  • Smart growth: developing a knowledge and innovation based economy,
  • Sustainable growth : promoting a more resource efficient, greener and more competitive economy; and
  • Inclusive growth: fostering a high employment economy delivering social and territorial cohesion.

The OECD has published The Bioeconomy to 2030: designing a policy agenda, a report detailing policy actions that governments can take to support the emerging bioeconomy. Several countries have already embraced the concept of the bioeconomy and are implementing national bioeconomy strategies. More information on bioeconomy strategies available through links at the end of this page.

Why is the bioeconomy needed?

The world is currently facing a number of challenges such as population growth; climate change; increased greenhouse gas emissions; and access to food and water. Moreover, as the population grows so does demand for both renewable and non-renewable resources. The bioeconomy is expected to increase food security; produce healthier food; and reduce the environmental impact of agriculture and fisheries as well as manufacturing industries. The bioeconomy will also help the world to transition away from fossil fuels for energy and industrial raw materials.

Industrial biotechnology is a key technology for realising the bioeconomy, as it enables commodities be produced from biomass, rather than non-renewable petrochemical feedstocks.

Biorefineries and biomass value chains in Australia

Banner representing the Bioeconomy

Above: Illustration of a biomass value chain. Biomass (for example sugarcane and forestry residues) can be processed in biorefineries into a variety of products such as polymers for plastics production, other chemicals, and biofuels like  ethanol.

A biomass value chain is a set of linked, value-creating activities that create commercial outputs from organic materials. An integral part of biomass value chains are biorefineries, which utilise biological matter (as opposed to petroleum or other fossil sources) to produce chemicals, fuels, heat and power. Biofuel production is the most recognised example of current biorefinery technologies in Australia, although there is increasing international interest in using industrial biotechnology to produce multiple products from biomass.

In 2010 the Department of Innovation, Industry, Science and Research commissioned two scoping studies on the viability of Australian tropical (sugar cane) and temperate (forest and crop residues) biomass value chains. The studies identified that there is sufficient tropical and temperate biomass for commercial scale production of chemicals, materials and fuels/energy. Biomass based industries could create export revenues, reduce Australia’s dependency on petroleum imports and revitalise existing industries (sugar, forestry, pulp and paper and chemicals).

The studies also recognised several challenges in establishing biomass value chains. The processes involved are technically challenging, and the facilities are expensive to set up. Moreover, there are existing markets for both sugar and forest products (such as woodchips). As the economic case for establishing biorefineries depends to a large degree on market prices for these commodities, ensuring a stable feedstock supply for biorefineries may prove challenging.

The Australian Government released the reports on Australian biomass value chains on 20 September 2011 noting that research on converting biomass into materials such as fuel, plastic and chemicals can help Australian industries reduce their reliance on imported petrochemicals and contribute to a richer, fairer and greener future.

More information on the studies’ findings is available in the reports:

The studies will inform several departmental activities, including:


International Knowledge Based Bio-Economy (KBBE) Forum

The department facilitates Australia’s participation in the KBBE Forum, a collaborative policy/research initiative between the European Commission, Australia, Canada and New Zealand.

The KBBE forum aims to share knowledge on policy strategies and actions, and create new knowledge to address the societal challenges related to the bioeconomy. It also fosters collaboration and joint activities between participating countries to promote innovation in the bioeconomy sectors.

The forum has four work streams for collaboration:

  • Biotechnologies for biorefineries and biobased materials;
  • Food and health;
  • Fisheries and aquaculture; and
  • Sustainable agriculture. 

Australia is coordinating the activities within the Food and Health workstream. The department of Industry has responsibility for providing Australia's executive secretary to the Forum.

The Australian research community is being consulted in the development of collaborative opportunities available through this initiative. More information on Australia’s role in KBBE is available at the Joint Science and Technology Cooperation Committee Communique 2010 page.

Examples of national bioeconomy related strategies

 Further information

  • CSIRO has collated information about the Australian bioeconomy
  • The European Association for Bioindustries (Europabio) has a biobased economy portal.
  • The European Union’s Biotechnologies, Agriculture and Food Directorate has presented on the topic of the Bioeconomy 2020 strategy and priority setting for research  [PDF 445 KB] .


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