Sustainability and Profitability Through Intelligent Value Chain Management in Bast Fibre Processing

Abstract

The excellent properties of natural fibres like flax and hemp have not yet been fully exploited for high added value applications such as use in bio-based natural textiles and high performance fibres. There are few practical applications, although today's know-how in fibre purification, modification and application allow for a large array of viable bio-based products. Currently the development of these natural fibres is strongly determined by the EU subsidy regulations, which drive the motivation of farmers and processors. Due to the expansion of the European Union, agricultural subsidies will decrease in the next decade. Natural fibres will compete only successfully against these reductions by fulfilling three key factors:

•	Product quality: The continuing lack of pure, fine and homogenous fibres has to be overcome.
•	Market demand: Market demand is driven by product quality. There is a big and increasing demand for high quality upgraded natural fibres in textile and non-textile industry.
•	Price: Farmers and fibre producers must have a reasonable economic basis.

Today the economic situation in the agricultural sector is extremely poor without subsidies. However, with each subsequent processing step in the fibre production value chain (mechanical refining, fibre upgrading by wet refining) the profitability increases significantly. To gain economic sustainability in the whole value chain (including spinning and weaving) the more profitable, high added value processing steps at the end of the chain should be employed to offset the less profitable steps. To realise this, we recommend a contract-network between agriculture, mechanical refining, upgrading and manufacturing of half-finished products. The business, which upgrades fibres, owns the innovative key-processing step (quality drives demand). It will lead the network and market fabrics with higher value and better profit by itself. All partners in the network participate by receiving fair prices. This will also guarantee continuous production of high quality raw material by farmers. A detailed operational calculation of the network shows promising results with a good internal rate of return.

Key Words:

• Flax
• hemp
• bast fibres
• processing
• refining
• economy
• profit