The Guangxi Zhuang Autonomous Region (Guangxi province in Southern Central China) is one of the most important Chinese provinces as regards sugar production. The region hosts the Guitang Group, which operates one of China’s largest sugar refineries, and was established by the State in 1956 (it later became a stock company owned by Shenzen Huaqiang Holdings Limited). The Guitang Group has gradually incorporated Industrial Symbiosis in its operations, following internal and external symbiosis strategies in order to respond to market fluctuations. Its activities have led to the creation of an industrial complex, currently including food and beverage, chemical and cement companies and pulp and paper plants.
The main challenge that drove the implementation of Industrial Symbiosis in the district was for the Guitang Group to maintain its competitiveness despite the high sugar cane prices imposed by the local government. A floor price for the sugar cane is in fact imposed by regional authorities in China, in order to guarantee fair contractual conditions to the suppliers.
One of the barriers encountered by the company in Industrial Symbiosis implementation was the fact that the production volumes of new by-product derived products that were required in order to survive on the market often exceeded the by-product availability. This condition could bring additional costs due to the supply of raw materials and reducing the self-sustainability of the new business. In addition, the company had to face also a technical barrier, given by the new technologies required to implement identified exchanges, adapting the production processes to the use of by-products as raw materials.
The approach used by the company to overcome the first barrier was to start collecting its competitors’ by-products. Such approach exposed it to risks related to increased competition, but these risks were mitigated by the high level of knowledge and unique capabilities developed by the Guitang Group, as well as by the higher quality of its products. As regards the technological barrier, the company has created collaborative projects with local Universities and its own Technology Centre.
The discovery process for the implementation of Industrial Symbiosis in the region started with the Guitang Group exploiting its by-products by the means of internal symbiosis. In practice, the company has created several downstream processes that use its own by-products as input. This has resulted in the creation of two main production chains (sugar and paper) and a connected energy recovery chain, closing every loop as much as possible by the means of waste and by-products reuse. In addition, the company has established symbiotic links with external actors, mainly its suppliers and competitors, as well as some neighbouring facility. Every single exchange has been created as a result of a positive economic evaluation and/or as a means to leverage the costs of specific activities. For example, when the company decided to shift from sulfitation to carbonation process for sugar production, which allows having higher product quality, there was a problem of managing the higher environmental impact and disposal costs of filter muds. In fact, disposal costs for carbonation filter muds are usually higher than the ones for sulfitation filter muds, similarly to their environmental impact. The Guitang Group therefore decided to sell the carbonation filter muds as raw material to the nearby State-owned cement production facility, which allowed to avoid disposal costs. Another relevant example of the mode of operating of the company is the decision to start producing organic fertilisers as a by-product of sugar and alcohol production and to provide them at no cost to its sugar cane suppliers, in order to encourage them implementing organic farming techniques, thus increasing the appeal of its own product on the market.
The main precondition for the industrial symbiosis implementation in this case was the fact that both national and local government had the possibility to highly influence the company’s decision-making process, as well as the surrounding business environment. In fact, not only the regional government set the sugar cane price, but it also required smaller sugar producers to send at no or low cost their by-product to the Guitang Group, as inputs for their processes. In addition, the government also imposed high level of by-product utilisation for the Guitang Group’s products. All these negotiations among the local government and the neighbouring companies has provided motivation and a dynamic environment for symbiosis implementation.
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