Diversified Natural Products Inc.

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Scottville, Mich.-based Diversified Natural Products Inc. entered into an agreement with a French agricultural-research company, Agro-Industrie Recherches et Developpements, to begin jointly producing succinic acid from fermented crop sugars. Environmentally friendly succinic acid can replace polluting oil-based chemicals used in the production of biodiesel fuel, industrial solvents, polymers and other products. Because succinic acid is edible, it can be used in food to enhance flavor.
Read the Detroit Free Press article about Diversified Natural Products Inc.

Source: DNP site

Michigan company hopes crop-based product lessens need for oil

Detroit Free Press By James Prichard / AP Business Writer

SCOTTVILLE, Mich. -- Gary Mills hopes a chemical made from corn and other crops will be as appetizing to his customers as the gourmet mushrooms and salt substitutes that his company also produces.

Mills is chief operating officer of Diversified Natural Products Inc., a business formed in October 2003 to find ways of using renewable resources to replace foreign oil, and to develop ingredients and products that are healthier for consumers and safer for the environment.

"Our whole premise is 'green' technologies," Mills said.

Diversified entered into an agreement this week with a French agricultural-research company, Agro-Industrie Recherches et Developpements, to begin jointly producing succinic acid from fermented natural sugars found in corn, wheat, sugar beets and other crops.

Clean burning and biodegradable, succinic acid can replace polluting petrochemicals used in the production of biodiesel fuel, industrial solvents, polymers and deicers for roads, airport runways and airplane wings. It also can be used in cosmetics and, because it's edible, in foods as a taste enhancer.

With crude oil and gasoline prices at all-time highs, the market looks good for alternative fuels based on soybeans and other renewable resources, U.S. Rep. Pete Hoekstra said Wednesday during a tour of the operation.

"We can produce ethanol at roughly a buck a gallon and that's going to be going down. We can produce soy diesel, biodiesel, at around $2 a gallon. That's probably going to get less expensive," said Hoekstra, R-Holland. "These products in the ag community become very, very competitive against traditional fossil fuels and I think that means nothing but good things for ag in Michigan."

At first, it will be more expensive to produce but per-unit costs should drop as manufacturing volume increases, Mills said.

The companies expect to initially start producing 1 million pounds per year. Much of the biotechnology was developed and patented by Michigan State University researchers, based on initial work by the U.S. Department of Energy. Fifteen of Diversified's patents have resulted from the research of Kris Berglund, a Michigan State professor of chemical engineering who is Diversified's chief science officer.

"We're using the same type of science that's created medicine to solve one portion of the nation's energy problem -- that 20 percent of imported oil goes into the petrochemical business," said Paul Jacobson, Diversified's chairman and chief executive officer.

French President Jacques Chirac felt strongly enough about the agreement to take part in its announcement.

"It's not often that the president of a European nation announces a collaborative effort with a Michigan company," said David Hollister, director of the Michigan Department of Labor and Economic Growth. "It is great to see DNP prosper here in Michigan as it gains international attention."

Diversified, which operates at the 51.6-acre site of an abandoned bean cannery in Mason County about eight miles east of Ludington, has 56 employees after starting with about 25. It is a privately owned company whose investors include Toyota Tsusho Corp., a sister company of Japanese automaker Toyota Motor Corp.

Besides developing a process for creating succinic acid from crops, Diversified also uses lysine from corn to make sodium-free salt substitutes marketed under the names AlsoSalt and HalsoSalt.

It recently started growing gourmet mushrooms in special rooms on bread loaf-sized blocks made from water, sawdust and a nitrogen component. The company markets them to restaurants and health-food stores in the Chicago area, and has plans to expand to grocery stores throughout the Midwest.

Other companies also are using succinic acid in their products.

Last year, Dynamarketing Group Inc., a San Diego maker of nutritional supplements, started selling Cheerz, which contains synthesized succinic acid and promises to reduce or eliminate hangover symptoms -- headaches, nausea, dry mouth -- by helping the body to better process alcohol.

Patrick Cochrane, Dynamarketing's chief executive officer, said Friday the word is beginning to spread about the many uses of succinic acid.

"As the next few years go by, you'll probably see more and more on it (in the news) because that's the kind of potential it has," Cochrane said.

Gary Mills, Ph.D, left, CEO of Diversified Natural Products of Scottville, holds a log with cinnamon nameko mushrooms as he talks with Rep Pete Hoekstra (R-Holland) during a tour of the plant. The company announced a joint agreement with the French to produce succinic acid from "green" sources.