BV Sorbex, Inc.

PROPRIETARY

BIOSORBENT MATERIALS
FOR METAL REMOVAL/RECOVERY

MARKETS FOR ION EXCHANGE RESINS AND BIOSORBENTS

The major competing technology for the family of new biosorbent products is that based on well established ion
exchange resins. Ion exchange technology has been developing over the period of past five decades and it is
considered a mature area marking a gradual but limited growth as the case is for all well developed technologies.
In order to assess the potential immediate market share of the new biosorbent products which use the same
process application mode as ion exchangers, it is essential to review the situation in the market of ion exchange
resins.
The market facts concerning ion exchange resins which have grown into a commodity product a with a multibillion dollar sales volume are well concealed in the overall sales of multinationals that rule the field.

Ionex Sales Volume

Recent Market Development

Ion exchange resins are used in all industrialized

countries. Major production facilities exist in the USA.,
Japan, Russia, France, Italy, Germany, and the United
Kingdom. In addition, plants in Canada, India, South
Korea, China, Brazil, Mexico, and several Eastern
European countries manufacture ion exchange resins for
domestic consumption.
In developing nations, tariff
regulations frequently encourage local functionalization of
imported copolymers to provide ion exchange resins.
World-wide production of synthetic ion exchange resins
probably exceeds 1.5x105 m3. In deionization and water
softening applications, ion exchangers can be considered
commodity chemicals because of the characteristic excess
production capacity, limited market growth, and intense
competition. However, resins used in smaller markets, e.g.
chemical processing, sugar refining, pharmaceuticals,
hydrometallurgy, catalysis, and wastewater treatment, are
classified more as specialty chemicals.
It has been extremely difficult, if not impossible, to find
reliable quantitative estimates of the ion-exchange resin
market. This is probably due to all the factors mentioned
above and the market figures for ionex resins are hidden in
the overall commodity production data released by the few
transnational corporations involved. Correspondingly, the
most dilligent searching yielded only cursory information.

Small quantities (<15% of the market) of ionex

resins are imported into the U.S. primarily because of lower
prices; U.S. pricing and sales since 1975 are reflected in the
Figures below.
A dramatic effect of oil price instability on resin prices has
been seen already early, e.g. 1973 embargo, as styrene
pricing is directly affected by the price of benzene from
which it is made. Resin availability was severely curtailed
then and prices rose correspondingly. The latter half of the
70s was characterized by a dollar value increase which
resulted from a combination of inflationary pressures and
real volume growth. The resin production volume growth
partly resulted from the increased need to process poorer
quality water, the resurgence of uranium processing
industry and the additional use of ion exchange systems for
sugar processing.
Ion exchange resin sales have
experienced an increased growth rate in dollar value in the
early eighties, resulting still partly from inflationary effects.
However, as the inflationary pressures eased off in the late
80s, the sales continued even stronger due to increasing
market demands and broadening applications of ion
exchange technology, particularly in the specialty
chemicals domain. Obvious enormous strength of the
market is in perceived applications of "clean-up"
technologies due to the increasing environmental concerns.
ION EXCHANGE RESINS MARKET (USA):

ION EXCHANGE RESINS SALES (USA):

7
6US$

ION-EXCHANGE
RESINS SALES
(USA)

Billion

3
2

0
76

78

80

82

84

86

100

88

80

60

Sales Volume
3
40
1,000m

YEAR
74

120

Resin
Price
4
3
US$ 1,000/m

90

20

YEAR
74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90

BV Sorbex, Inc.

PROPRIETARY

Ionex Market Volume

Expanding Markets

The total ion exchange resin sales volume in the

US alone doubled from $2.5 billion/y in 1980 to $4,8
billion/y in 1986. These figures, reflected in the preceding
diagram, indicate a strongly growing market. The main
component responsible for this growth strength is the
speciality component of the ion exchage business. The
market for ion exchangers in post-communist countries is
estimated to be about equal to that in the United States (in
dollar value). It has been estimated that the latest total
value of ion exchange resins sales world-wide (in the US
dollar equivalent) amount to more than $16.5 billion per
year.
Projecting these total ion exchange sales figures
into the "speciality" fraction of the ion exchange resin
market represented by the non-commodity resins which do
not exceed the 25% share of the total, the world sales
volume for this category of ionex resin products has been
estimated at approximately $4.2 billion per year worldwide, with the North American share at $1.6 billion per
year as of the latest.

The market share of biosorbents is expected to

grow exponentially with their price edge which will tend to
open new markets inaccessible to ion exchange resins due
to their high costs: Current ionex resin price: $50-70/kg
Estimated biosorbent cost: $ 3-7/kg
With the application mode of the two "active" products
being practically identical, the conspicuously lower price of
biosorbents signifies a qualitative change in the market
structure which is likely to open up with applications which
were not feasible for conventional ion exchange resins.
Nowhere else is this case as apparent as in the field of
environmental applications. Large volumes of metalbearing wastewaters make more expensive conventional
treatment technologies prohibitive. As a result, these newly
opening market opportunities for biosorbent products will
not be accessible to ion exchangers. At the same time, the
environmental regulatory pressures will obviously not
subside, ever. Increasing strong trends toward preservation
of the environment and recovery of resources provide a
powerful stimulus for ever widening scope of biosorbent
technology applications. The situation has been changing
and the new market opportunities for the clean-up
technologies being opened are truly enormous.

Ionex Market Limits

Approximately 75% of the resins sold in the
United States go to home and industrial water pre-treatment
with the balance divided between chemical processing,
metal recovery, effluent and wastewater treatment and
small finer specialty applications. A requirement for a
competitive ion exchange material is such that it be
available at such a price that its use in appropriate
equipment is economically favorable over competing
processes, e.g. distillation, crystallization, dialysis, reverse
osmosis, electrodialysis, solvent extraction, etc. The market
price of ion exchange resins is such that it seriously limits
the feasibility of the process in truly huge area of
wastewater treatment applications which is becoming
increasingly more prominent due to mounting
environmental pressures. It seems that this expanding
market will belong to alternative technologies which can
offer similar service at a fraction of the ion-exchange price.

Market Opportunity for BV SORBEX, Inc.

Products:
Further development of BV SORBEX, Inc. is
backed by its curent technological and know-how
advantage. Provided that the corporate start-up phase and
further growth of BV Sorbex, Inc. will be well managed, it
can be assumed that it will developed into the leading
enterprise in the new technological field. It would not then
be unreasonable to consider that its market share could be
secured in the vicinity of 25% of the total market for
biosorbents. This translates to a very conservatively
estimated currently existing maket oppotunity in biosorbent
products for BV SORBEX, Inc. of approximately $28
million per year in North America alone (see the chart on
the next page).

Biosorbent Market Opportunity

The new discoveries and the pioneering R&D
work on the new biosorbent materials have established their
extraordinary potential in binding heavy metals. The major
application and market opportunity for the new biosorbent
materials is correspondingly seen in the field of
detoxification of metal-bearing industrial effluents & metal
recovery.
Currently, these applications represent
approximately 15% of the established ion exchange market.
On a world-wide basis this represents a 15% fraction of the
$16.5 billion per year sales which is $2.483 or
approximately $2.5 billion/year. Transposed to the North
American fraction of about 1/3 of the world figure, this
signifies current sales of approximately $800 million/year
worth of metal-binding ion exchange resins. A very
conservative estimate could expect the new and cheaper
biosorbents to penetrate that market to the level of at least
15%. Even with no expansion of the market, this represents
a currently existing market opportunity amounting to $120
million/year in North America alone.

Services:
The above product market share does not
include the engineering service market component which is
logically part of the BV SORBEX, Inc. business plan.
In order for a new family of biosorbent products to find its
best uses in well designed and efficiently operating
applications, a host of consulting and engineering services
has to precede and accompany the operation of actual
effluent treatment plants. For best results, client-based
treatability studies have to be carried out and product
application schemes designed. The actual operation of the
biosorption plants may also be contracted out by the client
to the Company which may also be looking after the
recovery of the metals removed from the solutions.
Appropriate engineering back-up of the biosorbent products
is essential.
Realistically estimated service market
currently exists in the order of additional $60 million/y for
North American biosorption applications alone.

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BV Sorbex, Inc.

PROPRIETARY

The immediate initial market share of the biosorbent venture can be estimated from
anticipated penetration of existing proven ion exchange resin markets :

BIOSORBENT
NICHE MARKET
specialty resins:
HEAVY METALS

Total Ion Exchange Resins

North America ~ US $ 2 billion/year

SALES
US $ 300 million/year
North
America

15%
penetration

10%

BIOSORBENTS: US $ 30 million/year
CONSERVATIVELY GUARANTEED !

BIOSORPTION ENTERPRISE
complete
WASTEWATER
TREATMENT

new
BIOSORBENT
MATERIALS

SALES

SERVICES
Treatability
Studies
Environmental
Consulting

Process
Operation

METAL
RECOVERY

RESALE

Process
Engineering
Biosorption enterprise is intended to be broader then just selling biosorbents selling
equipment too. In addition, the spectrum of services from treatability studies to the entire
process operation gives BV SORBEX, Inc. a wider, more dynamic and more flexible
business base.

17