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Economic contribution of the biobased industrial products industry in Minnesota: 2019

Key findings

Grain elevator.

Construction activities of Minnesota biobased industrial product companies

  • Generated an estimated $1.2 billion of economic activity in the state. This includes $540.6 million in labor income.
  • Supported employment for 8,325 workers.
  • Generated an estimated $46.5 million in tax collections.

Operations of Minnesota’s biobased industrial product companies

  • Generated an estimated $610.7 million of economic activity resulting from their operations, including $127.0 million in labor income.
  • Supported employment for 2,415 workers in the state.
  • Generated an estimated $13.3 million in tax collections. These impacts are annual and will continue as long as the companies operate at current levels.

Minnesota Bioincentive Program

  • In 2019, companies claiming the Minnesota Bioincentive received $1.5 million in incentives.
  • For every tax dollar invested in incentives, $407.10 is generated in the economy. In addition, for every dollar of incentive, approximately $8.90 is collected in taxes.

About this report

Minnesota has long been an industry leader in the development of biobased industrial products. Biobased companies transform a feedstock (e.g., grain, oilseeds, energy crops, crop residuals, wood, municipal organic waste) into a product, such as biofuels, renewable chemicals, and heat. There are many examples of biobased companies in Minnesota, including plants that produce cellulosic ethanol, wood pulp for use in textiles, and biodiesel.

During the 2015 legislative session, the Minnesota Legislature enacted the Minnesota Bioincentive Program. The program’s design supports the growth and development of the state’s bioeconomy. Funding comes from the Agricultural Growth, Research, and Innovation (AGRI) program appropriation. As of January 2020, funding was $2.5 million per each year of the biennium.

The Great Plains Institute hired University of Minnesota Extension to quantify this economic contribution of Minnesota’s biobased industrial product industry in 2019. 

Read full report (PDF)

Author(s)

Brigid Tuck, senior economic impact analyst

Reviewed in 2020

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