Biobased products are industrial and consumer goods composed wholly, or in significant part, of biological products, renewable domestic agricultural materials (including plant, animal, and marine materials), or forestry materials. These biological products and agricultural and forestry materials are generally referred to as biomass. Corn, soybeans, vegetable (plant) oils, and wood are the primary sources used to create biobased products. In some cases, these biobased sources are combined with other materials such as petrochemicals or minerals to manufacture the final product. For example, soybean oil is blended with other components to produce paints, toiletries, solvents, inks, and pharmaceuticals. However, some biobased products, such as corn starch adhesives, are derived entirely from the plant feedstock. Table 1 provides further information on biobased products made from plant-based resources. Appendix II lists sources for additional information on these and other biobased products. The many derivatives of corn illustrate the diversity of products that can be obtained from a single plant-based resource. As well as an important source of food and feed, corn serves as a source for ethanol and sorbitol, industrial starches and sweetners, citric and lactic acid, and many other products. Figure 1 shows the many uses of corn, including its industrial uses. Biomass resources are naturally abundant and renewable, unlike fossil resources. According to the DOE, in the continental United States, about 500 to 600 million tons of plant matter can be grown and harvested annually in addition to our food and feed needs. These abundant resources can be used in the growing biobased products industry to help meet the nation’s demand for energy and products while reducing its dependence on imported oil. In addition, supplementing petroleum resources with biomass can provide other important benefits such as growth in rural economies and lower emissions of greenhouse gases and pollutants. According to DOE, the impacts of the growing biobased products industry on rural economies have yet to be quantified, but these impacts could be very positive. Expanding this industry will require an increase in production and processing of biomass that could provide a boost to rural areas. For example, expansion could create new cash crops for farmers and foresters, many of whom currently face economic hardship. In essence, this growth could move the agricultural and forestry sectors beyond their traditional roles of providing food, feed, and fiber to providing feedstock for the production of fuels, power, and industrial products—making these sectors an integral part of the transportation and industrial supply chain. In addition, development of a larger biobased products industry would require new processing, distribution, and service industries. In general, these industries would likely need to be located in rural communities close to the feedstock and could potentially result in positive impacts on rural communities through increased investment, income, taxes, and employment opportunities. Regarding environmental benefits, biomass is carbon-fixing, and represents a way to produce fuels, power, and products without contributing to global warming, according to DOE. Although some fossil resource inputs may be needed for the production of biomass and biobased products—such as fuel to run farm equipment, petrochemical fertilizers and pesticides to produce the biomass, and the energy needed to manufacture the biobased products made from this biomass—biomass removes carbon dioxide, a significant greenhouse gas, from the atmosphere through photosynthesis. The carbon component is then fixed, or bound up, in the biomass and stays in the biobased product made from this biomass for a relatively long period of time before it is released through biological decay. According to DOE, when petroleum is used as the feedstock to manufacture many products, such as plastics, up to 25 percent of the carbon in the petroleum is lost to the atmosphere during production. However, producing these products directly from biomass reduces the carbon released during production and increases carbon- fixing plant matter. In addition, as a renewable resource, biomass represents a way to recycle carbon in the environment; in contrast, the use of fossil resources results in a net release of carbon to the environment. Finally, many biobased products are readily biodegradable, meaning they can be safely placed into a landfill, composted, or recycled and do not emit hazardous volatile organic compounds or toxic air pollutants. According to DOE, the potential for biobased products to move into entirely new and nonconventional markets is substantial. New biobased products with improved economic and/or environmental performance could make significant inroads in markets historically dominated by other materials. For example, according to the Biobased Manufacturers Association, about 300 companies are now producing nearly 800 biobased products to replace other materials. These companies include a number of major corporations or their subsidiaries. In addition, increasing environmental consciousness has created “green consumerism”—a segment of consumers who are willing to pay more for products that are less harmful to the environment. Currently, many of those “green” products are biobased, such as corn-based plastic ware, soy-based engine lubricants, and citrus-based household cleaners. Perhaps the greatest factor driving the growth of biobased products will be their acceptance by the public, business enterprises, and government as a solution to some of the nation’s most pressing resource problems. However, according to USDA, it often takes 15 to 20 years for a new material to be accepted and adopted by industry; and consumers, businesses, and government procurement officials are often reluctant to switch from familiar products to new ones. Thus, to make significant inroads, biobased products will need to be environmentally sound and competitive with traditional products in both performance and cost. The increased use of these products will also require favorable government policies, such as continued support for biobased research and development and affirmative procurement programs that emphasize biobased purchases for government needs. In addition, their increased use will depend on the nation’s continued desire to reduce its dependence on imported oil and further technology improvements that will lead to new applications and more efficient production of biobased products. In the last 10 years, the federal government has taken steps to promote the use of biobased products. For example, the President issued an executive order in 1998, replacing a similar executive order issued in 1993, to encourage federal agencies to buy products that are environmentally preferable and/or biobased. A subsequent executive order was issued in 1999 with the aim of tripling the nation’s use of biobased fuels and products by 2010. Regarding legislation, the Biomass Research and Development Act of 2000 directs DOE and USDA to closely coordinate their research and development efforts on new technologies for the use of biomass in the production of biobased industrial products. The 2002 farm bill reauthorized the biomass act, continued funding for biomass research and development programs, and set forth federal agency purchasing requirements for biobased products. The legislative history of the farm bill states that Congress enacted the biobased provisions to energize new markets for these products and to stimulate their production. With respect to promoting federal purchases of biobased products, the 1998 executive order required USDA to issue a Biobased Products List by March 1999. Once the list was published, federal agencies were encouraged to modify their procurement programs to give consideration to biobased products. USDA published a notice in the Federal Register on August 13, 1999, to solicit public comments on a process for considering items for inclusion on this list and on criteria for identifying these items. As we reported in June 2001, USDA expected to complete this list by fiscal year 2002—3 years later than the executive order required. However, USDA did not complete the list because the 2002 farm bill set out new biobased purchasing requirements for USDA to implement. In the meantime, although the Federal Acquisition Regulation was amended to implement the executive order, federal agencies generally were waiting for USDA to publish a list before making any final decisions or modifications to their procurement programs. Whereas the executive order encouraged, but did not require, federal agencies to purchase biobased products, the farm bill generally requires that agencies give preference to these products. While USDA was faced with an ambitious task, its actions and consequently those of other agencies to implement the farm bill requirements for purchasing biobased products have been limited. USDA issued proposed guidelines in the Federal Register on December 19, 2003, more than a year later than the farm bill requirement for final guidelines. These guidelines take only limited steps toward meeting the requirements of the farm bill. While the guidelines recommend some procurement practices and practices for vendor certification, they do not identify items designated for preferred procurement or provide information on their availability, relative price, performance, and environmental and public health benefits. Although USDA hopes to have some items designated before the end of calendar year 2004, the process for designating other items discussed in the preamble to the proposed guidelines will take years, possibly until 2010. In addition, as new biobased products are developed and enter the market, these items will also need to be designated. Regarding other biobased-related requirements of the farm bill, USDA has not yet developed a labeling or recognition program or completed its work on preferred procurement practices known as the model procurement program to guide both its own biobased purchases and those of other agencies. In the meantime, as the top four procuring agencies await USDA’s fulfillment of these requirements—particularly the designation of items for preferred procurement—they have taken only limited steps to procure biobased products. For example, some agencies are purchasing biobased cleaners, lubricants, deicers, and/or dining ware because these products are readily biodegradable and composted. USDA’s proposed guidelines only partially meet the requirements of the farm bill. While the guidelines recommend some procurement practices and practices for vendor certification, they do not identify items designated for preferred procurement or provide information on their availability, relative price, performance, and environmental and public health benefits. However, in the preamble to the guidelines, USDA discusses possible items for future designation.