The Hardest Part isn’t Chemistry. It’s the Second Plant.
By Dave Skibinski, CEO, FiberX
Earlier this month, FiberX added its name to a letter sent to Congress by more than a hundred companies, farm groups, and trade associations asking members to cosponsor H.R. 8137, the Biobased Materials Investment and Production Act. We also sent a letter of our own to Senator Todd Young, asking him to carry it in the Senate. We’ve also asked the same of Representatives Spartz and Mrvan in the US House of Representatives.
We don’t put our name on much. We’re a small company in Merrillville, and most days we’d rather be running equipment than writing letters to Washington. But this bill goes straight at the hardest problem in our business, and I want to explain why we’re behind it.
The science isn’t the bottleneck
There’s a story people tell about companies like ours that goes: the technology is the hard part, and once you crack it, the rest takes care of itself.
That’s not how it works.
The chemistry that lets us pull lignin out of corn stover and tune it for a specific customer application came out of Purdue’s Davidson School of Chemical Engineering. It works. We’ve proven it. Our mechanical refinery is running today, and we have customers paying for fiber feedstock right now.
The hard part is the next step. Going from a process that works at demonstration scale to a first-of-its-kind commercial plant takes a lot of capital, up front, before a single pound ships. And a first-of-its-kind plant is exactly the kind of thing capital markets are least comfortable funding, because there’s no identical facility down the road to point at and say, “like that one.”
James Glueck at the Plant Based Products Council put it about as plainly as it can be put: America is very good at the bright idea. But when it’s time to take that idea from the laboratory to the manufacturing line, people go to Europe or Asia to do it.
That’s the part that ought to bother anybody in Indiana. The idea gets born at Purdue. The plant gets built somewhere else. The jobs go with it. And then we buy the material back.
What the bill actually does
H.R. 8137 is a tax bill, and it’s short on ideology and long on arithmetic. It lets a company producing bio-based chemicals and materials from American-grown biomass choose one of two things:
- A production credit of 10 cents per pound on qualified renewable materials produced and sold, capped at $10 million a year, or
- A 30% investment tax credit against the capital cost of building or retrofitting a manufacturing facility.
You pick the one that fits your business. A company already producing takes the production credit. A company trying to get a plant financed takes the investment credit. Nobody’s telling you which.
Three details matter more than they might look:
It excludes food and fuel. This is aimed squarely at materials and chemicals — the plastics, adhesives, resins, and coatings that are still made from petroleum, most of it from somewhere else.
It requires domestically grown feedstocks. The benefit can’t be claimed on biomass grown overseas. That’s a deliberate choice, and it means the money lands with American farmers.
It’s technology-neutral on the conversion route. The bill covers biological, thermal, catalytic, and chemical conversion, or any combination. Congress isn’t picking a winning process. It’s setting a bar and letting companies figure out how to clear it. That matters to us directly — our Purdue-developed process is catalytic, and a narrower bill could easily have written it out.
Why this is an Indiana bill
Indiana grows a lot of corn. Every acre of it produces stover — the stalks, leaves, and husks left in the field after the grain comes off. That’s the feedstock our whole platform runs on, and there is a great deal of it within a short haul of Merrillville.
The American ag bioeconomy is already a $489 billion industry supporting close to four million jobs, and the renewable products market is projected to grow by another $550 billion by 2050. Indiana is positioned about as well as any state in the country to take a real share of that — leading corn production, a serious manufacturing base, and Purdue in the middle of it.
We’re not the only ones in the state who see it. The Indiana Corn Growers Association, the Indiana Life Sciences Association, and the Indiana Soybean Alliance all signed the same letter we did. Congressman Jim Baird has already cosponsored the bill in the House.
And we’ve asked two more members of our own delegation to join him. We’ve written to Congressman Frank Mrvan, who represents Merrillville and Northwest Indiana — where our refinery runs and where the jobs this bill supports would land. And we’ve written to Congresswoman Victoria Spartz, whose central Indiana district is where we did our first stover harvesting — where the feedstock comes from. A Democrat where the plant is, a Republican where the corn is, and Congressman Baird already on the bill. That’s about as good a picture of who this legislation is for as you could draw.
And Senator Young has been out front on this for a while — he introduced the Biobased Market Expansion Act with Senator Padilla last year, aimed at building domestic demand for bio-based products. H.R. 8137 is the other half of that equation. Demand is good. Demand without the capacity to supply it just means we import more.
What we’re asking
We’ve asked Senator Young to champion this bill in the Senate — by introducing or cosponsoring a companion, or by advocating for its passage. We’ve asked Congressman Mrvan and Congresswoman Spartz to add their names in the House, alongside Congressman Baird.
If you’re an Indiana manufacturer, a grower, or anyone with a stake in whether the next generation of American materials gets made here or bought from abroad, your representatives should hear from you too. This one is bipartisan, it’s narrow, and it’s practical. Those don’t come along often.
We’d rather build the plant here.
— Dave Skibinski, President & CEO, FiberX
FiberX turns post-harvest corn stover into bio-based fiber and lignin feedstocks for industrial applications. We’re always interested in talking with manufacturers evaluating bio-based inputs, accredited investors, and potential biorefinery development partners. Contact us.
