Survey and Analysis of the US Biochar Industry

Preliminary Report Draft; August 16, 2018

,WERC project MN17-DG-230
Executive Summary
A survey and analysis of the US biochar industry was commissioned by the US Forest Service,
via a Wood Innovations Grant. Two surveys were generated; one for producers and one for
users. The Surveys were composed using Survey Monkey and the US Biochar Initiative
distributed invitations and follow-up requests. Out of an estimated 135 biochar producers in the
US, responses were received from 61, a 45% response rate; 58 responses from domestic biochar
users were received.

The surveys are complementary in their results with two trends standing out:
 Growth in sales supported by a general optimism in the strength of the marketplace.
 Desire for more information and support from all types of resource entities.

The producer survey indicated the expected growth in year-to-year production is supported by
the expectation of increased sales, higher prices, and the availability of feedstocks at affordable
prices. This outlook is also bolstered by the expectation of users to increase purchases.

The users survey provided a snapshot of an optimistic marketplace. Many of the smaller users
left comments expressing their interest in learning more about biochar, about the broader
marketplace, about how to market more effectively to grow their businesses, and for more in-
depth information about research results (which could help both their understanding and
marketing.) They also uniformly anticipated higher sales.

Responses to questions about what the industry/trade association, public policy, and the USFS
specifically can do to support and grow the market provided particular insight. The most often
cited historic support come from IBI and USFS Wood Innovation Grants. Cooperative research
initiatives with universities were noted by larger producers as helping to advance their progress
while there was widespread desire for more biochar-related research.

From a policy standpoint, producers cited recognizing biochar as carbon negative (and getting
some financial credit for it) by almost 25% of the respondents. The second most repeated
support need was to certify biochar as an animal feed supplement—by six of the responding 23
larger producers—and both USDA and FDA were cited as important players in opening that
market. It was noted by a number of respondents that biochar as a feed supplement is allowed in
Europe already.

Both users and producers see the need for much higher profile education efforts—in support of
biochar as a desirable and sought after product. The new market segment of biochar as an
animal feed supplement is considered strongly for its potential to have a significant impact on
both producers and resellers; however resellers will likely see less effect since volume sales seem
to be provided mostly from producers. More information on this market (current European
experience, domestic customer interest, price points, and value added opportunities) is needed to
better predict how significant the animal feed supplement could be. The same can be said for
other currently minor segments with large potential markets: stormwater filtration, mine
reclamation, and odor control.

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 Survey and Analysis of the US Biochar Industry
Preliminary Report Draft; August 16, 2018
,WERC project MN17-DG-230

Introduction:
A survey and analysis of the US biochar industry was commissioned by the US Forest Service,
via a Wood Innovations Grant in 2017. The survey was conducted by the project team
consisting of:
 Kathleen Draper, Finger Lakes Biochar and Ithaka Journal; NY
 Harry Groot, Dovetail Partners, Inc.; Minneapolis MN
 Tom Miles, Tom Miles Consulting, Inc. and US Biochar Initiative; Portland, OR
 Martin Twer, Biomass Program Director, The Watershed Research & Training Center;
Hayfork, CA

Methodology
Two surveys were conducted; one for producers and one for users. The Survey was composed
using Survey Monkey and the US Biochar Initiative mailed the invitations and follow-up
requests. The specific survey input was promised as confidential, however a field was provided
to allow individuals to authorize follow-up—which was conducted with selected respondents by
project team members.

Out of an estimated 135 biochar producers in the US, we received responses from 61, a 45%
response rate, as well as 58 responses from domestic biochar users in a parallel survey. The
analysis was based on these responses (survey questions attached in Appendix A and B) in
addition to follow-up interviews by phone and in person.

All members of the project team participated in the data compilation, analysis, and reporting.
Of the 69 responding producers, 7 respondents were Canadian and one was German. Their data
has been segregated. All 58 of the users were domestic.

Note on data management:

Some of the data presented will be based on the entire response set; however, the focus will be
mainly on the higher volume producers and users since the project team feels they reflect “the
industry” most accurately. The smaller producers and users are frequently do it yourselfers
(DIY) and skew the desired industry focus of this study.

The raw response data is not being shared to honor the promise of confidentiality to
respondents.

Introduction
Prior to this survey, the US biochar industry production was estimated to be between 15,000-
20,000 tons per year (TPY). This survey provides data to support an estimate of 35,000 to
70,000 TPY. Given that this estimate is based on a 45% response rate, it’s reasonable to project
an industry-wide production of 45,000 TPY, which is the basis used in this report.

Using a 75% reduction in dry weight from raw feedstock to finished biochar, biochar production
would consume about 200,000 bone dry tons of biomass as feedstock. Knowing that most

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 Survey and Analysis of the US Biochar Industry
Preliminary Report Draft; August 16, 2018
,WERC project MN17-DG-230
feedstock ranges from 20 to 60% moisture content (for woody and ag biomass, the most common
feedstocks) it can be extrapolated that the industry uses between 125,000 to 250,000 delivered
tons of feedstock.

The users represent a usage of 163 to 200+TPY, less than 1% of industry’s projected production
capacity. There is no way to know what percentage of all consumers this represents, but the
project team solicited their input to better understand issues rather than to gain a comprehensive
picture of market demand.

Producers Survey Data

5 producers over 5000 Tons per year of biochar production (TPY)
7 between 1000 and 5000 TPY (with one being Canadian)
5 between 500 and 1000 (with one being Canadian)
6 between 100 and 500 (with one being Canadian)
1 between 50 and 100, and 45 respondents producing less than 50 Tons per year (with 4
Canadian and 1 German.) 21 respondents didn’t state their production volume.

The domestic biochar production represented by the survey respondents is between 35,000 and
70,000 Tons per year. The Canadian production adds an additional 1,700 to 6,600 TPY for a
North American total of 18,700 to 76,600 TPY.

A note about the following data presentation: The larger producers were relatively thorough in
responding to the survey questions, so while there is a fairly consistent 25 to 30% non-response
rate on a question-by-question basis, it affects the lower 10 to 20% of the volume of biochar
produced for the most part. As a result, this analysis will focus large on the volume producers.

The larger producers have been in business on average, longer than most of the intermediate
sized producers, however there were 9 firms producing less than 100 TPY with more than 5
years production experience.

57% of the respondents were biochar producers primarily, with 29% as a byproduct of energy
generation and 8% as a byproduct of electricity generation. For 6%, biochar production was a
form of waste disposal. 29% didn’t respond to this question.

82% of the respondents were producers and only 18% were resellers. Of the 14 resellers, only
two purchased between 1000 and 5000 tons per year while 4 purchased between 100 and 500
Tons, and 8 purchased less than 50 Tons per Year.

Producers sell most of their biochar for agricultural uses: gardens, field crops, orchards,
horticultural applications, turf, and landscaping. The table below shows for which applications
producers and resellers are selling biochar:

The highlighted uses below are aggregated under an “Agricultural” class:

Garden 62%
Horticulture, specialty crops 47%
Field Crops 42%

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 Survey and Analysis of the US Biochar Industry
Preliminary Report Draft; August 16, 2018
,WERC project MN17-DG-230

Orchard or tree crops 29%

Turf 20%
Landscaping 36%
Stormwater, filtration 33%
Odor control 27%
Other 18%

The “other” category includes concrete admixture and pigments.

Of the largest volume producers (23 in number), 43% (10) make biochar for no specific end use.
35% (9) make biochar for agricultural applications specifically, 9% (2) for drainage, 13% (3) for
odor control specifically, and 22% (5) didn’t say.

Five of the largest volume producers sell their biochar as-is. Twelve of them process further
(sizing, pelletizing, charging/inoculating/activating, neutralizing pH, and/or mixing with other
soil amendments), and 5 didn’t answer.

Biochar is supplied as (in rank order):

1. Coarse chips
2. Fine powder
3. Fine screened chips
4. Pellets
5. Granules or prills
6. Liquid suspension.

Most of the large suppliers responding (39%, 9) do not pursue any independent certification,
however 5 have OMRI listing or Organic certification and 5 use IBI standards. Nine of the 23
did not respond.

The majority of biochar is shipped locally and regionally (less than 500 miles), however exports
are being made to Europe, Asia, Australia and the Middle East by producers in all production
classes.

Responding producers and resellers were evenly split on customer requests to know if the
biochar was locally sourced, with the smaller scale producers most often asked.

Most all producers provide information to customers about their biochar—from analysis results
to how-to-use instructions. Only 1 of the large volume producers provided no information, with
five not responding.

None of the biochar producers—of any size—expect there to be a decrease in demand, with
almost 60% of respondents expecting prices to increase more than 10% as a result of that
demand. Most of the larger tier producers expect demand to grow modestly to significantly.
Only 4 of the 23 upper tier producers anticipate needing to expand capacity to meet growing
demand and only three of them expect to have a problem obtaining feedstock. The feedstock
sourcing is predominantly woody in nature, but a wide variety of materials are viewed as

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 Survey and Analysis of the US Biochar Industry
Preliminary Report Draft; August 16, 2018
,WERC project MN17-DG-230

potential sources, including manures, grasses, ag waste, construction waste, fiber, and food
waste.

The market segments showing the highest expectations for growth are, in rank order: crops,
filtration, odor control and other, with biochar as an animal feed supplement the most mentioned
market segment.

Advertising biochar was direct, relatively traditional, and unsophisticated:

Word of mouth 68%
Direct response to inquiries 46%
Google Adwords 2%
Print media 10%
Website and other electronic media 44%
Conference and trade show displays 29%

The top producers claim to have spent millions on research annually, with the level of support
declining proportionately as production levels decreased. The degree of decrease was not linear;
however without more specific details the relative percentages and trends cannot be determined.

The data last section asked open ended questions about policy and opportunities for support
provided wide ranging responses. There were many thoughtful suggestions and a few common
threads, which will be captured and discussed in the analysis section.

Users Survey Data

The breakdown of users was:
5 users consuming more than 20 Tons per year of biochar (TPY)
10 users consuming between 5 and 20 TPY
11 users consuming less than 1 TPY
25 users consuming a few gallons per year (at 7.5#/gal.)
6 users didn’t specify quantity.

As noted above, the users represent less than 1% of the estimated domestic production of
biochar.

Most respondents classified themselves as gardeners, farmers or landscape contractors. In the

larger users, most were resellers. The motivation for using biochar was fairly consistent and
multi-faceted, including: modifying soil texture, improving air/water porosity, improving water
management, and increasing soil carbon. There was modest motivation to change soil chemistry
or modify pH, and to improve disease resistance.

The majority of respondents (55%) use the biochar dry. 38% use it inoculated and 39% blend it,
most commonly with soil and/or other soil amendments.

The biochar users bought the material in the following forms (in rank order) :
1. Fine powder
2. Fine screened chips

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 Survey and Analysis of the US Biochar Industry
Preliminary Report Draft; August 16, 2018
,WERC project MN17-DG-230

3. Coarse chips
4. Pellets
5. Granules or prills
6. Liquid suspension

As seems reasonable, larger volume users have been in business longer than smaller users,
however 49% of all respondents have been using biochar for at least two years and most of the
top tier have over 5 years’ experience.

Of the 54 respondents, there was a notable increase in current volume used versus expectations
for the coming year:

Usage Last This

Year Year
Less than a ton 49% 28%
More than a Ton 23% 31%
A Semi-Truckload (20T) 19% 26%
Multiple Truckloads 9% 15%

There seems to be broad satisfaction with suppliers in that 81% of users have not changed from
whim they buy; 10% had changed suppliers due to quality issues and 8% due to availability
issues.

Organic/OMRI Certification was important to 31% of respondents; IBI to 9%; State-level

certification to 15%; and no certification was noted as important by 36%. 92% of respondents
said the climate impact of biochar was of importance to them. Only 4 of the 26 upper tier
producers (15%)said climate impact was unimportant.

Most top tier users get their supply from 100 to 500 mile shipping distance, but 27% of them
experience shipping distances of over 1500 miles. With few exceptions, respondents indicated
the fact the biochar is produced locally was an important criteria (94%).

When asked whether they knew or cared from what or how their biochar was made only one
respondent answered “no.” Four percent said that information was not disclosed and 85% said
they knew the details despite responses to a question about receiving an analysis where 43%
responded yes. All the recurrent large volume buyers received analyses of their biochar while
only 40% of the truckload volume buyers received analyses.

Reported prices paid for biochar ranged widely depending on the packaging and volume
purchased. For the larger scale users the lowest cited cost was $75/CY, the average price was
$129/CY, with $200/CY FOB the most often cited price1 (or $1600/Ton.)

As with the Producers, the input offered from open ended questions will be discussed in the
analysis section.
1
Conversions used: 8CY/ton or 216 CF/ton; 9.25#/CF; 1CY = ~22gallon

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 Survey and Analysis of the US Biochar Industry
Preliminary Report Draft; August 16, 2018
,WERC project MN17-DG-230

Analysis of Producers Survey Data

Two trends stand out: the growth in production and general optimism about the strength of the
marketplace. Secondly, is desire for more information and support from all resource providers.

The growth in year-to-year production is supported by the expectation of lower prices and the
potential availability of feedstocks at affordable prices. This outlook is also bolstered by the
expectation of users to increase purchases.

Responses to questions about how the industry/trade association, public policy, and the USFS
specifically can do to support and grow the market provided particular insight. The most often
cited historic support come from IBI and USFS Wood Innovation Grants. Cooperative research
initiatives with universities were noted by larger producers as helping to advance their progress.

From a policy standpoint, recognizing biochar as carbon negative (and getting some financial
credit for it) was mentioned by almost 25% of the respondents. The second most repeated
support need was to certify biochar as an animal feed supplement—by six of the larger
producers—and both USDA and FDA were cited as important players in opening that market. It
was noted by a number of respondents that biochar as a feed supplement is allowed in Europe
already.

There was frustration expressed with EPA regulations by two mid-sized operations, but no
specifics were provided as to what actions would help ease their concern.

A number of producers noted the need for stronger definition of biochar “grades” and improved
standards. Others made mention of the desire for more support to get the word out to users (the
public and farmers specifically) about the benefits of biochar.

Responses to a question about how USBI or a trade association could best support producers
were very similar to the question about what policy initiatives would help most: advocacy for
carbon credits, education of the public and farmers specifically, marketing, and research
leadership.

Two notable actions were suggested for USBI. The first is to participate more in long-term
research which (hopefully) shows the benefits of biochar in soil and mixed amendment systems.
The second notable suggestion was for market research which “compares biochar to existing
products (like AC, compost, and soil blends) to determine price points and pain points of buyers
that use other [soil amendment] products.

In response to a question how the USFS and Federal Agencies could support the biochar industry
a number of responses cited purchasing biochar for forest and mine reclamation. Improved
accessibility to, and the increased use of stewardship contracts to provide feedstock was
mentioned by a number of producers while compliments were given to USFS for the use of
stewardship contracts by other producers. Streamlined regulations to acquire woody biomass
were mentioned by multiple respondents. One insightful respondent suggested a cost/benefit
analysis: “Quantify in $ terms the benefits of avoided slash piling burning, irrigation water

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 Survey and Analysis of the US Biochar Industry
Preliminary Report Draft; August 16, 2018
,WERC project MN17-DG-230

availability from juniper treatments and thinning.” As well as “Economic and enterprise models
that help build an investment case for biochar production.”

One interesting response was the amount spent on research internally. Three of the five largest
firms claim to be spending in excess of $1M/year, with and 2 currently mid-sized operations
spending similarly, and four others in the $250K to $500K range. These commitments are
impressive and, for a relatively young industry with a relatively small market, can be interpreted
as indicative of optimism for stronger demand for biochar products.

Analysis of Users Survey Data

The users survey provided a snapshot of an optimistic marketplace. Many of the smaller users
left comments expressing their interest in learning more about biochar, about the broader
marketplace, about how to market more effectively to grow their businesses, and for more in-
depth information about research results (which could help their understanding and marketing.)

One respondent expressed interest in using biochar as a concrete additive and as a component in
other building materials (unspecified) which is being done by one of the large producers,
suggesting a potential for collaboration.

Shipping and handling costs were cited by a two users as being of more concern than the raw
biochar costs even though their shipping distance was less than 500 miles for truckload volumes.

As in the producers’ survey responses, users wanted more information about the animal feed and
stormwater filtration markets.

Conclusions and Next Steps

The surveys are complementary in their results. Both producers and users see a growing
demand. There are different expectations in price points between the two groups, which is
typical and will be worked out over time as production is balanced with usage.

Both groups see the need for much higher profile education—in support of biochar as a desirable
and sought after product. The new market segment of biochar as an animal feed supplement is
considered strongly and its potential could have a significant impact on both producers and
resellers, however resellers will likely see less as volume sales seem to be provided mostly from
producers. A value added opportunity may exist for resellers to produce a branded or
customized end-product, which producers could be reluctant to take on. More information on
this market (current European experience, domestic customer interest, price points, value added
opportunities) are needed to better predict how significant it could be.

There was a difference between the form of the biochar being provided by producers and the
form being purchased by the users. This may be useful to producers in aligning better with
buyers of their finished product. Future research should explore this facet more closely.

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 Survey and Analysis of the US Biochar Industry
Preliminary Report Draft; August 16, 2018
,WERC project MN17-DG-230

Biochar as a confirmed carbon sequestering product was expected to have the greatest potential
to enhance its demand. However, it’s an unlikely driver in the near term without a solid
scientific claim (and/or legislation.) There are a wide variety of production technologies and,
therefore, a wide range of carbon balances to consider. This variability complicates the
certification of carbon sequestration capability and considerable collaboration, funding, and
effort will be necessary to establish a credible calculation schema. Political considerations also
come into play considerably in this process as there are already a number of skeptical
organizations actively questioning the entire system of woody biomass production and
conversion. Collaborating in the biomass energy producer’s efforts to quell and quantify could
be a cost effective strategy.

For updated information on this project check the USBI website: [Link]
[Link]/news/us-biochar-market-survey-0.

And for information on this project and other explorations of our land use decisions, visit the
Dovetail Partners Report website: [Link]

The work upon which this project is based was funded in whole or in part through a grant awarded by the U.S.
Forest Service, Wood Innovations; (#17-DG-11420004-230 WERC).

Nondiscrimination Statement:
In accordance with Federal Law and U.S. Department of Agriculture policy, this institution is prohibited from
discriminating on the basis of race, color, national origin, sex, age, or disability. (Not all prohibited bases apply to
all programs.) To file a complaint of discrimination, write USDA, Director, Office of Civil Rights, Room 326-W,
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TDD). USDA is an equal opportunity provider, employer, and lender.

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