Novozymes: Bioenergy sales fall 9% in 2020

By Erin Voegele | February 04, 2021

Novozymes released fourth quarter financial results on Feb. 2, reporting that its bioenergy segment was negatively impacted by the COVID-19 pandemic in 2020. The reduction in bioenergy sales, however, improved in the fourth quarter. Additional gradual recovery is expected into 2021.

Novozymes reported that its bioenergy sales declined 9 percent organically last year. “COVID-19 restrictions, first implemented in the spring, severely disrupted U.S. gasoline and ethanol demand and, subsequently, ethanol production and Bioenergy sales,” the company said in a statement. “Monthly U.S. ethanol production rates improved gradually from the trough in April/May but still ended the year well below 2019 levels.”

According to Novozymes, the performance of its bioenergy division in North America ended roughly in line with estimated industry development. The company also said increased market penetration with yeast solutions and the continued expansion of corn-based ethanol production capacity in Brazil and China contributed positively to full-year sales.

Bioenergy sales for the fourth quarter were down only 4 percent organically. Novozymes said bioenergy sales for the quarter continued to be down due to the still negative, but easing, year-on-year impact from COVID-19 related effects on U.S. ethanol production. Emerging markets, however, grew.

Bioenergy accounted for 18 percent of Novozymes total sales last year. Overall, the company reported 0 percent organic sales growth for 2020, with sales for the company’s Household Care division up 5 percent, sales in Food, Beverages and Human Health up 1 percent, Bioenergy sales down 9 percent, Grain and Tech Processing sales down 1 percent, and sales for Agriculture, Animal Health and Nutrition up 1 percent.

"COVID-19 made 2020 a year like no other in recent memory and I'm extremely proud of the way our ‘Zymers’ have handled these difficult circumstances,” said Ester Baiget, president and CEO of Novozymes. “The advances we made during the year are a testament to Novozymes' strong purpose, culture and well-diversified business model. I’m confident that we will return to growth in 2021, supported by a more streamlined organization, stronger commercial presence, innovation, as well as a gradual recovery in those areas adversely affected by the pandemic."

Moving into 2021, Novozymes expects organic sales growth for its bioenergy segment. That growth is expected to be driven by a gradual recovery in the U.S. ethanol industry. Growth contribution from regions outside the U.S. is expected to be positive.