Business & Policy
High hopes for vegetable-oil based lubricant
September 25, 2012, Guelph, ON - A new vegetable oil-based multipurpose lubricant is now available for sale in Canada – and there are high hopes about the new markets it could open up for Canadian grain and oilseed farmers.
Smart Earth Corporation’s new Ecolube product was developed in Canada by Linneaus Plant Sciences Inc. as a sustainable substitute for popular lubricant and penetrant products like WD-40. Its plant-based ingredients make it an environmentally friendly alternative to traditional petroleum-based products.
Ecolube is the first in what is hoped will become a whole category of vegetable-oil based products that will bring new market opportunities for the Canadian soybean industry.
“We have identified consumer use lubricants as a pretty significant opportunity for bioproducts in the next 10 years,” says Jeff Schmalz, president of Soy 20/20. “This is the first lubricant product of this type developed by Linneaus Plant Sciences and we’re excited at what the future potential of this market might mean for the Canadian soybean industry.”
Soy 20/20 estimates the Canadian market share of the petroleum-based lubricant and penetrant category segment to be around $40 million annually. The goal, says Schmalz, is to capture 10 to 20 percent or more of that volume with environmentally friendly alternatives that use vegetable oil-derived ingredients.
And although he admits that’s an aggressive target, Schmalz points to the cleaners category where sales of bio-based glass cleaners and kitchen cleaners have risen substantially in recent years once consumers became aware of their environmental benefits. For farmers, development of the lubricants market brings the potential of a premium of up to $2 per bushel for growing the high-oleic soybeans needed for these kinds of bioproducts.
Linneaus Plant Sciences has long been working on replacing petroleum-based ingredients in products such as lubricants, foams and plasticizers, and they’ve found vegetable oil to have superior lubricity – it is better at being slippery – compared to petroleum oil. Petroleum oil, explains Linneaus president Jack Grushcow, has no lubricity when it comes out of the ground and it is chemical additives that give it its oily characteristics. And there are numerous other advantages as well.
“If you can formulate a product using vegetable oil instead of petroleum, you get something that is biodegradable, non-toxic, non-flammable and renewable – and it won’t stain and doesn’t have an odour,” says Grushcow. “Our goal ultimately is to take these Canadian vegetable oils and put them into a product to deliver higher value to the entire value chain.”
A chance meeting at a conference brought Grushcow and Schmalz together, and led Soy 20/20 to help Linneaus shepherd Ecolube through several stages of commercialization, including branding, packaging, production, marketing and business development.
Financial support from Grain Farmers of Ontario helped pay for an AC Nielsen market study to gauge consumer perceptions of the product. The results showed that over 70 percent of respondents would buy it compared to other, conventional products, and indicated a consumer willingness to pay up to $2 more per can of Ecolube than WD-40.
“We’ve really appreciated Soy 20/20’s valuable expertise in retail packaging, design and other areas,” says Gruschow. “The AC Nielsen testing has been very useful to us and we appreciate Soy 20/20 encouraging us to get this early customer input.”
Soy 20/20 is now working with Smart Earth Corporation, based in Guelph, to develop a Canadian retail presence for Ecolube. Both Grushcow and Schmalz admit this isn’t going to be easy, but they’re both committed to getting the brand to succeed, including promotions at upcoming consumer events this fall such as the Toronto Cottage Life Show, the Canadian Health Food Association Show and the Royal Agricultural Winter Fair. And once a retailer has picked up the product, Soy 20/20 will develop in-store point-of-sale material to draw consumer attention.
“We feel really comfortable in taking products from a concept or prototype to completion,” says Schmalz, whose organization works with numerous bioproducts companies in this capacity and who specializes in hiring experts with the skills Soy 20/20’s clients need to move their products forward. It’s the clients, however, who pay for all the business activities, stresses Schmalz, and once a product is successfully launched into the market, Soy 20/20 steps back and moves on to the next opportunity.
“Our mandate is to help grow the market for Canadian soybeans and what Soy 20/20 can fund is the experts needed to get a job done, to put people strategically in the right area to make things happen,” he adds.
Grushcow credits early financial support from the federal and Saskatchewan governments in helping Linneaus get started, including a grant from Agriculture and Agri-Food Canada’s Agricultural Bioproducts Innovation Program to evaluate where Canadian oilseeds can be used and in what kind of products. Linneaus also accessed grants under the Industrial Research Assistance Program and Saskatchewan’s Agriculture Development Fund.
“It’s a tough market to break into and we wouldn’t be anywhere without this government funding,” he says, adding that Linneaus is also looking forward to continuing its relationship with Soy 20/20. The company is already working on other products in the Smart Earth brand franchise, including chainsaw oil, hydraulic fluids and household lubricants.
“We are moving away from one-size-fits-all commodity beans to purpose-grown crops for specific application, and there are premiums for high-oleic crops and crops grown for high-end uses,” says Schmalz. “If we can build a market for Ecolube and a number of these kinds of products, this will allow companies to come into Ontario and build production, which is a win for farmers.”
More information about Smart Earth Ecolube is available at www.smartearthlubricants.com.
Photo: Smart Earth Ecolube is a new WD-40 style lubricant made using vegetable oil. The product is now available for sale in Canada. Photo courtesy of Soy 20/20.
September 25, 2012 By Lilian Schaer