On December 1, Bioconversion, the first company dedicated to the production of insect flour, will start operating in the ZEDE del Litoral.
Mauricio Laniado returned to the country after 26 years of living in the United States, to take the risk of investing and giving birth to a new industry in Ecuador, that of the production of insect meal as an input for animal feed. He and three other national investors are carrying out Bioconversión, a company that will formally open its doors on December 1 after a pilot process that began in 2017 and which validated excellent results.
What does Bioconversion do?
It is a company that is dedicated to converting the organic waste that agribusiness discards: banana peels, passion fruit peels, bread residues, non-valid foods … all that Bioconversion transforms it into protein through an insect.
What insect?
It’s a fly Hermetia Illucens known as a black soldier. It is a fly that exists in Ecuador, in the entire equatorial line of the world, it does not generate diseases, it does not damage crops, in its adult state when it flies it does not have a mouth, it only absorbs moisture and lays eggs. The eggs when they become larvae are the ones that feed until they pupate (cocoon). The life cycle of the insect is 45 days, it is of very high turnover.
How do these flies get to make protein?
The excrement of the larvae is dried, ground and turned into protein. This we deliver to the balanced food plants, it is one more input for animal feed. The excrement of the larvae (also) is a fertilizer for the earth, that is a by-product, for the agriculture part. They are two products.
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Why through insects?
Insects in the last 10 or 15 years in Europe and the United States have been using them, it has been discovered that it is a great natural recycler, it feeds on this that we humans throw away, discard and its body when feeding converts it into protein, the larva of the insect has 45% protein and 126% fat and all the amino acids required for good animal nutrition. Already in Asia and in other countries they are using it for energy bars, here we are starting with animal feed.
Are there other companies that use insects to produce protein in the country?
As far as I know we are the first industrial plant in Ecuador that exists.
When did this project start?
We started a pilot plant at the end of 2017, we rented a warehouse and with very small machinery we started. We started this because we were looking for sustainable solutions for the environment, we as a family have banana plants, and we are always looking for how to use everything.
How did you hear about this industry?
A Swiss group gave a course, in 2017, and we began to investigate what they were already doing elsewhere, however, at that time the information was very restricted, there were plants, but they did not want to give information and I spent two months in Indonesia in a project of the Swiss who did this project, that’s when I was seeing what I had read, I wanted to see it and feel that this was real. In those two months I confirmed that the project was viable, that it really converts, transforms.
How did you apply in Ecuador what you saw in Indonesia?
I came, I began to investigate, in the Peninsula (Santa Elena) we got some larvae and basically in the backyard of my house I began to do it, I lasted two months there, then I went to a winery and we began to breed the insect and the plant was practically, first, to validate the project, to first validate that the insect grows well, develops well, grows well and all that was validated; and second that there is enough raw material to feed this insect and for this we spoke with the agribusiness and they saw the benefit that this brings, that instead of dumping it in a sanitary landfill and creating CO2 and methane gas and the environmental damage that we all already know, do this, something out of nothing, do something positive.
How did you approach your potential customers, the balanced plants?
I validated the market, I spoke with the balancing plants and indeed some of them, one of them specifically, supported us and we began to deliver a little bit after nine months, because we did not have the installations done. That company validated us, authorized us and qualified us as suppliers as insects inputs. We did a financial project to see the validity and profitability, we did all of that in 2018 and 2019, while we were raising the insect and delivering product.
Can this product replace other inputs that exist in the market?
Yes, insect protein can replace or complement fish meals, soy meals, which are the proteins used to feed animals.
What would be the impact of this substitution?
One hectare of insect meal is equivalent in protein to 300 hectares of soybeans. We help reduce the pressure to deforest to plant soybeans. In one hectare of insect, 2 million pounds of protein can be produced. You know that 30% of the catch goes to meal for protein, that should go to human consumption not to meal, this can help take the pressure off. On the other hand, the prices of flour and protein are also very volatile, we believe that insect flour, due to its raw material, will be much more stable in price, there should not be so much fluctuation.
How much have they invested in this project?
Once we validated this, it was the time when I invited several Ecuadorian investors to join the project, we reached an agreement and capitalized the company. The total investment of this project, with everything we have done, will reach $ 2.5 million in December, the most important thing has been the investment in this area.
Did you only seek national investors?
At first we were looking for foreign investment and there were two or three interested parties, some who were in Vietnam, two French and a company that has investments in Ecuador, but they spoke of very large amounts, of 10 and 15 million dollars for a plant of 1,000 tons per year and some said I want 51% others said 55%; and I realized that they did not have that value, perhaps doing it in France in other countries is much more expensive.
The company will open in December on the Espol campus. How did Bioconversion come to this field?
This land is in loan, for 17 years, with the ZEDE del Litoral, a Special Economic Development Zone that has legal and tax indications beneficial for innovation and industrial development. And we are here not only because we are ZEDE, but because it is equidistant for agribusinesses.
A development zone in the Espol
What are the benefits of settling in the ZEDE?
The most important benefits are in tax matters that allow the investment made to have tax and tariff exemptions; And that is important for a new business that does not exist in Ecuador.
Does being in the ZEDE entail other agreements with the Espol?
We have signed technology transfer and research agreements. Professors from the university have come, we are talking to see if we extract melanin from the pupa of the insect, which is a substance that is used in medicine for coatings for medicines.
How much will the new plant produce and how much will the pilot plant produce?
Our projection is to produce 100 tons per month of insect meal and 500 tons per month of compost. In the pilot plant, which is on the road to Daule, behind Inmaconsa, we have 200 square meters, that’s the difference, here we have a 6,000-square-meter plot of land with a 2,700-square-meter plant.
How many people work in the company?
Right now we are six people, but the project already in operation should have a maximum of 25 people, we are in the selection process. The starting process until we are to full We think it should be three to six months.
What is your projection for this nascent industry?
In the next ten years, if things are done well, the industry can process 70,000 tons per year of flour, that means 1 million tons per year of organic matter that stops going to landfills and turns into proteins that stop imported and the improvement of the environmental impact. That means $ 140 million to $ 160 million a year (in sales), 3,000 people with new jobs, and possibly investments of $ 100 million to $ 120 million over the next 10 years. (I)
Paul is a talented author and journalist with a passion for entertainment and general news. He currently works as a writer at the 247 News Agency, where he has established herself as a respected voice in the industry.
