FIRST- AND SECOND-GENERATION VALORISATION OF WASTES AND RESIDUES OCCURRING IN THE FOOD SUPPLY CHAIN S. KUSCH*, C.C. UDENIGWE**, M. GOTTARDO°, F. MICOLUCCI°° AND C. CAVINATO° * Engineering and the Environment, University of Southampton, Highfield Campus, SO17 1BJ Southampton, UK ** Faculty of Agriculture, Department of Environmental Sciences, Dalhousie University, Truro, Canada ° Department of Environmental Sciences, Informatics and Statistics, University Ca' Foscari of Venice, Italy °° Department of Biotechnology, University of Verona, Italy SUMMARY: Despite the high potential to increase sustainability of food systems, wastes and byproducts occurring in the food supply chain are currently only partially valorised at different valueadded levels. First-generation valorisation strategies that aim at utilisation of complete material streams for production of animal feed, energy, compost and/or specific consumer applications are already widely implemented and experience further dissemination and/or development (e.g. biohydrogen/biohythane production) – either in the form of single processes or as part of cascade utilisations. Second-generation valorisation strategies comprise various forms of fractionised utilisation of material streams. They rely on integration of adapted recovery and conversion procedures for specific components in order to obtain sequentially different classes of products, e.g. fine chemicals, commodity products and biofuels. Such advanced strategies are particularly suitable for wastes and by-products occurring during industrial food processing. Valorisation of food byproducts for functional food is an emerging trend. 1. INTRODUCTION Food wastes and by-products occur along the whole food supply chain: during agricultural production and initial storage, during industrial processing, during distribution and retail, and during consumption (domestic consumption, restaurants, catering services). So-called postconsumer waste comprises materials that occur at the point at which food is consumed (meal preparation, food leftover, discarded food), while wastes generated during earlier stages of the supply chain can be summarised under the term pre-consumer waste. Wastage of food does not only mean reduced amounts of available food, but at the same time also means loss of embedded energy and other resources such as water and fertiliser. It is therefore evident that avoidance and Proceedings Venice 2014, Fifth International Symposium on Energy from Biomass and Waste San Servolo, Venice, Italy; 17 - 20 November 2014 2014 by CISA Publisher, Italy Venice 2014, Fifth International Symposium on Energy from Biomass and Waste valorisation of food waste and by-products have significant potential to increase overall sustainability of food systems by addressing all three sustainability dimensions: environment, society, economy. Exemplary factors include: Improved food security (Diaz-Ambrona and Maletta, 2014) Reduction of environmental burden related to the food sector (carbon footprint, water footprint, wastes); increased resources efficiency Unlocking of food-bioenergy synergies in particular through efficient valorisation of wastes (Kusch and Evoh, 2013); reduced dependence on fossil fuels Higher customer satisfaction in retail sector, restaurants, catering services; consideration of public concerns related to food security and sustainability of food supply chains Reduced waste disposal costs for the food processing industry and the food sector in general Fostering of innovation and creation of employment opportunities Characteristics of wastes and by-products occuring at each step of the food supply chain can vary within wide ranges both with view to quantities and composition of the material streams. There are necessary differences in management strategies and suitable valorisation pathways. Valorisation of municipal food waste streams (post-consumer waste) is strongly linked to implementation of strategies focusing on collection schemes, logistics, quality control and possible limitations due to quality issues, high spatial and temporal heterogeneity of materials including seasonal variations, and in most cases construction of new treatment plants. First-generation valorisation strategies based on utilisation of complete material streams are most suitable in this context, and as indicated in the following various options are already widely applied, while other options are under further research. In contrast, industrial food waste streams hold particularly good potential to integrate secondgeneration valorisation strategies based on fractionised consideration of components. Among others, in an industrial context quality of waste streams can be better predicted and managed, and integration of new processing lines in existing industrial facilities is feasible. Such material streams occur both in the food sector processing animal-derived material and in the food sector processing plant-derived material. Due to hygiene issues and health risks associated with meat and fish processing, vaorisation of resulting wastes and by-products is economically and technically less feasible, despite the increasing quantities of material (Mirabella et al., 2014). In particular, secondgeneration valorisation aiming at the supply of high-value chemicals will therefore generally be advantageous for plant-derived food waste with low contamination risk (Pfaltzgraff et al., 2013). Plant-derived agro-wastes contain various categories (Ajila et al., 2012): crop wastes and residues, by-products from fruit- and vegetable-processing industry, sugar and starch and confectionary industry by-products, by-products from grain- and legume-milling industry and oil industry, and byproducts from distilleries and breweries. In addition to the solid effluents, food processing generates significant quantities of wastewater with generally high organic loading. This publication discusses selected central issues related to both first- and second-generation valorisation pathways for food wastes and by-products. The contents are mainly based on a related publication as book chapter (Kusch et al., 2014), which contains more detailed information. In addition, the topic biohydrogen/ biohythane is presented here in more detail (Section 2.3). 2. FIRST-GENERATION VALORISATION 2.1 Overview of main options First-generation valorisation strategies make use of whole material streams as they occur, with limited pre-treatment applied as necessary. The following main options can be considered as stateof-the-art applications: Venice 2014, Fifth International Symposium on Energy from Biomass and Waste Utilisation of food waste as animal feed, which is common practice in traditional agriculture for centuries; main challenges are: general suitability of specific substrates, seasonal availability and variability in nutritional levels, rapid spoilage, economic viability especially when pre-treatment is applied (Ajila et al., 2012; Murthy and Madhava Naidu, 2012; Van Dyk et al., 2013) Utilisation as soil conditioner or fertiliser, either through spreading of untreated food waste (e.g. tomato waste, olive husks or citrus waste (Van Dyk et al., 2013) or after composting or anaerobic digestion Use of food supply chain wastes for energy generation, in particular via anaerobic digestion (AD) with biogas production (especially wet material streams) or if suitable (especially for dry feedstocks) via thermochemical conversion (mainly combustion) Use as litter in animal barns (e.g. oat husks) Use of materials rich in lignin for mushroom cultivation (e.g. coffee industry by-products, brewery residues, tomato skins, corn stalk husks) (Liguori et al., 2013; Murthy and Madhava Naidu, 2012) Use as bioadsorbents for wastewater treatment (Kosseva, 2011) Cascaded approaches that sequentially combine various options and therefore maximise resulting overall benefits are often feasible with limited additional logistical efforts. One exemplary application is the use of husks (by-products from mills) first as litter in animal barns, then followed by energetic valorisation of resulting manure via anaerobic digestion with biogas production (Kusch et al., 2011). 2.2 A spotlight on biogas production AD of food waste has been established as state-of-the art technology during the last decades. Nevertheless, successful implementation requires specific knowledge about the process and applied technologies, and increased attention during operation of the plant. The process is susceptible to occurrence of both high concentrations of volatile fatty acids (VFA) and of ammonia (Banks et al., 2008; 2011); in particular, thermophilic operation increases the risk of digester failure. While ammonia remains a critical issue in AD (Rajagopal et al., 2013; Yenigun and Demirel, 2013), it is now well documented that the addition of trace elements stabilises a food waste digestion process showing VFA accumulation (Banks et al., 2012; Zhang and Jahng, 2012; Qiang et al., 2013). Codigestion of food waste and of organic fractions with a high carbon-to-nitrogen ratio is an efficient strategy to limit ammonia concentration during the process (Zhang et al., 2012) and to generally ensure favourable shares of nutrients, and should therefore be considered with priority. 2.3 A spotlight on biohydrogen/biohythane production A proposed approach to address the challenge energy supply under consideration of climate change concerns the production of hydrogen and its use as a clean fuel, looking at the forthcoming "Hydrogen Economy" which has been widely discussed recently. Nowadays, this approach still has many unsolved issues such as hydrogen storage technologies and its subsequent use as a fuel. Indeed, the characteristics of hydrogen require specific conditions: high pressure, the use of special materials to minimise diffusion and leakage, and extensive safety precautions. Moreover, the low volumetric power density of liquid hydrogen (1/3 of Compressed Natural Gas, CNG) and the necessity of developing new infrastructure slow down the realisation of this approach. At present, a feasible scenario is the Hydrogen Fuel Injection (HFI). With HFI is meant to mix a gaseous fuel with hydrogen to obtain a mixture with improved combustion characteristics. Hydrogen is characterised by a higher flame speed and a lower ignition energy requirement than the other traditional fuels, therefore a small amount of hydrogen added to the fuel promotes its better exploitation. Finally the hydrogen acts as a catalyst for combustion and only secondarily as energy Venice 2014, Fifth International Symposium on Energy from Biomass and Waste carrier. In the early 90s the Hydrogen Component Inc. (HCI) conducted several studies concerning the feasibility of the use of a blend of CNG and hydrogen as a fuel for internal combustion engines, and they showed that the lean burn of mixture of hydrogen (7% by energy or 20% by volume) and compressed natural gas (CNG) can reduce the emission of pollutants (mainly NOx) into the atmosphere, at the same time maintaining the energy efficiency of CNG. The use of this mixture does not require storage system neither particular changes both in the CNG engines and infrastructure. As a result HCI patented this mixture and the commercial name of this fuel was Hythane®. Several studies (i.e. in Italy performed by ENEA) were carried out on this fuel confirming the results shown above. Beyond the benefits, the addition of hydrogen to methane still has problems that must be overcome: in fact, both methane and hydrogen are produced using nonrenewable energy sources, by reforming processes of fossil fuels with the production of syngas, a gaseous mixture of CO and hydrogen, an intermediate in creating the Synthetic Natural Gas (SNG). To cope with this problem, recently, the attention has grown about the biological production of hydrogen and its use as a fuel mixed with biogas. The mixture hydrogen / biogas is known as BioHythane. As for the Hythane, many studies have shown that the addition of a small amount of hydrogen (about 10% by volume) improves the performance of biogas combustion in internal engine in cogeneration mode (combined heat and power, CHP), or the automotive industry (Graham et al., 2008), as a result of the upgrade for CO2 removal. This paragraph will point out the feasibility of biological hydrogen and biogas production process using biowaste as substrate. 2.3.1 Biohydrogen production by dark fermentation & biohythane: basic concepts Hydrogen is biologically produced by the activity of enzymatic complexes (Hydrogenase and Nitrogenase) produced by some prokaryotes and eukaryotes microorganisms (Kotay and Das, 2008) involved in three main biological processes: Biophotolysis of water, Photo-fermentation and Dark Fermentation. Currently, the Dark Fermentation is the process that arouses greater interest because it can be coupled with the anaerobic digestion process in order to produce biohydrogen and biogas (Biohythane). The biohydrogen production via Dark Fermentation of carbohydrates-rich substrates is carried out by some anaerobic bacteria, particularly Clostridium spp., Thermoanaerobacterium spp., Enterobacter and Bacillus (Reith et al., 2003). During acidogenic fermentation, pyruvate produced from fermentation of hexose and pentose sugars is oxidised in the presence of coenzyme A (CoA) to acetyl – CoA, while CO2 and reduced ferredoxin are generated. Then, acetyl – CoA can be phosphorylated to generate acetate or butyrate and ATP, and the reduced ferredoxin can transfer electrons to hydrogenase enzyme and molecular H2 is released from the cell. The maximum theoretical yield of hydrogen when the acetic acid is the final product of fermentation is 4 moles per mole of glucose consumed. Instead when butyric acid is the final product of fermentation the maximum theoretical yield of hydrogen is 2 moles per mole of glucose consumed (Angenet et al., 2004; Levin et al., 2004). Under hydrogenase inhibitory conditions the reduced ferredoxin is oxidised by nicotinamide adenine dinucleotide (NAD+), and the NADH generated reduces the acetyl-CoA and butyryl-CoA to ethanol and butanol, respectively. For these reasons, this metabolic pathway, named solvatogenic fermentation, does not produce hydrogen. Several studies have shown that pH condition and, in a minor way, temperature condition can affect the activity of the hydrogenase enzyme in the H2 production process (Valdez-Vazques and Poggi-Varaldo, 2009, Hallenbeck et al., 2009, Reith. et al., 2003). These papers reported that higher enzyme activity was observed between pH 5 and 6 (optimum value at 5.5) and at 55°C of working temperature. On the other hand, potential inhibitors of the hydrogenase enzyme are the hydrogen partial pressure that causes a metabolic pathway shift to solvatogenic fermentation, and free ammonia inhibition. One of the main issues regarding the continuous biohydrogen production via Dark Fermentation Venice 2014, Fifth International Symposium on Energy from Biomass and Waste is to maintain the pH value in the optimal condition, in fact the accumulation of organic acids (produced during fermentative metabolism), can decrease the pH value. Several strategies have been proposed to control the pH, for example the addition of chemicals or the use of proteincontaining substrates (Valdez-Vazques and Poggi-Varaldo, 2009). Recently some authors proposed an interesting strategy for pH control, coupling in series the Dark Fermentation process with Anaerobic Digestion process and using the recirculation of the anaerobic digestion effluent, rich in buffer agents, to control the Dark fermentation pH. Moreover from whole system, as mentioned above, is possible to produce biohythane. Different substrates could be used for biohythane production but, from a thermodynamic point of view, the conversion of carbohydrates to hydrogen and organic acids allows a highest amount of hydrogen per mole of substrate (Reith et al., 2003). For this reason, the biowaste is very interesting substrates for biohydrogen production via DF because the major fraction of biowaste is composed by carbohydrate (simple sugars, starch and cellulose). 2.3.2 State-of-the-art of biohydrogen and biohythane production from biowaste: processes applications Biohydrogen production through dark fermentation is generally implemented both at mesophilic (35°C - 37°C) and thermophilic (55°C) conditions, even if the thermophilic biohydrogen production is widely used at laboratory and pilot scale, and one demonstrative-scale plant has been realised in Italy (Lodi). Biowastes are abundant organic materials recovered by separate collection of municipal wastes or by food industry, and it is a material with a large energy content that must be exploited. These two aspects (temperature and substrates), together with other process parameters, are reported in Table 1 with the aim of reviewing the two-stage process for biowaste exploitation. Observing data shown in Table 1 some important guidelines could be resumed: Hydraulic Retention Time (HRT): hydrogen production increase with HRT decreasing, in fact the application of low HRT (from 2 to 5 days) in CSTR systems allows the washout of methanogens (Hawkes et al., 2007), favoring the development of fermentative producing hydrogen bacteria. The HRT, however, must be greater than the specific growth rate of the microorganisms producing hydrogen to prevent their wash-out (Kongjan and Angelidaki, 2010). 3 Organic Loading Rate (OLR): OLR applied vary significantly among 14 and 38.5 kgVS/(m rd). Basically, the higher the organic load applied the lower specific hydrogen production was observed. This may be due to the accumulation of hydrolysed substances that became toxic to the microorganisms cells. Along with pH, high organic acid concentrations could result in detrimental effects to H2 fermentation. Undissociated acids act as uncouplers that allow protons to enter the cell; sufficiently high concentrations of undissociated acids could generate a collapse in the pH gradient across the membrane. Thus, the shift to solventogenesis has been related to a detoxification mechanism of the cell to avoid the inhibitory effects (Valdez-Vazquez and PoggiVaraldo, 2009). Inhibition of hydrogenotrophic activity: most of experimentations aimed to optimise the fermentation phase, often applied pH monitoring/control (Shin and Youn, 2005; Gomez et al., 2006; Lee et al., 2010) and/or substrate pretreatment (Han et al., 2005; Chou et al., 2008; Lee et al., 2010) such as heat treatment (100 ° C - 10 min). In this regard an insightful practice has been developed in recent years as an alternative to the use of chemicals for external pH control in the DF phase: a recirculation flow from methanogenic reactor to hydrogen producing reactor that allows to exploit the residual buffer capacity (ammonium, bicarbonate) of digestate (Cecchi et al., 2005), to supply nutrients and dilute the feedstock used (Kataoka et al., 2005; Chu et al., 2008; Lee et al., 2010). Biohydrogen and biomethane yields: taking into account the gas yields obtained by pilot scale CSTR plant, a full-scale simulation of the process could be done. Looking at Cavinato et al. Venice 2014, Fifth International Symposium on Energy from Biomass and Waste (2011; 2012) and Giuliano et al. (2014), the experimentation were carried out with reactors size of more than 200 litres, and the average yields in terms of hydrogen and methane were ranging from 51.0 to 66.7 LH2/kgVSfeed and from 350 to 483 LCH4/kgVSfeed. Considering the best yields, it is possible to obtain 16 m3 of hydrogen per tonne of biowaste and 110 m3 of methane per tonne of biowaste, that means about 166 m3 biohythane per tonne of biowaste (0.8 m3/kgVSadded). The specific energy production that could be obtained is 404 kWh per tonne of waste with a specific energy requirement resulted in 20-40 kWh per tonne of waste treated (Cecchi et al., 2005). Table 1. Review of two-stage hydrogen and methane fermentation from biowaste (Food/municipal substrates) *Removal methanigen biomass flushing air, **HST (substrate heat treatment) ***Sonication / NA=not available, R=recirculation, A-B=acid-base control. ^ on COD basis 2.3.3 Research trends and challenges: automatic control and full-scale implementation of the twophases process Full-scale biohydrogen and biohythane process implementation is currently under evaluation, both in economic and long-term feasibility points of views. In fact the continuous recirculation can lead to an increase of alkalinity in the system favoring the proliferation of hydrogenotrophic microorganisms with a consequent low hydrogen yields, and also causing ammonia accumulation in the system. The use of a variable recirculation flow allows for controlling the whole process preventing the ammonia inhibition in the system, but process control based on monitoring of ammonia is not feasible, in fact ammonia probes applied in such a heterogeneous media could be difficult to use and may not be reliable in the long term. Using data from a long-term experimental Venice 2014, Fifth International Symposium on Energy from Biomass and Waste test (365 d) carried out at Treviso wastewater treatment plant (North Italy), a statistical model was developed to predict ammonia concentration in a two-phase anaerobic digestion system using the measure of Electrical Conductivity, Volatile Fatty Acids and Alkalinity. According to this strategy the decisive step was to define the set-points of these stability parameters in order to maintain the right amount of recycled effluent according to the change of the stability parameters of the reactors in real-time mode. For this reason, among the monitored parameter was also inserted the conductivity, which allows to use simple, resilient and cheaper online probes. The development of a real semi-automatic control of the whole process, using basic models able to predict the concentration of ammonia was developed and validated. The implementation of real-time monitoring and the development of automatic control of the process allows to verify process sustainability through a control logic based on set point, automatically maintaining the best conditions for the microorganisms and consequently maximising the biohydrogen and biomethane yields. This implementation is one of the most innovative, bringing pilot plants research to market. 3. SECOND-GENERATION VALORISATION 3.1 Overview Second-generation valorisation strategies are based on utilisation of specific ingredients with high added value in order to cover manifold purposes and to supply to the market a variety of products. Applications make use of one or several constituents of the biomass (e.g. sugars, starch, lipids, phenols, phytochemicals, amino acids, pectin) in order to convert or upgrade these constituents to defined target products. A huge variety of possible second-generation valorisation pathways exists, and applicability will depend on given situations and markets. A detailed overview is provided by Kusch et al. (2014). Despite the fractionation of the material streams a clear focus remains on complete overall valorisation of feedstock. The key aim is the maximisation of the efficiency of resource utilisation, mainly based on integrated production of both speciality and commodity products to enhance market flexibility and economic viability (Koutinas et al., 2014). Biorefinery concepts with extraction and/or conversion of constituents along with their diversion into adapted high-value production systems have already at least partially been realised for effluents and by-products from specialised sectors such as dairy and olive oil industry (Kosseva, 2011; Mirabella et al., 2014). Research results have identified a range of additional areas such as citrus peels or other fruit and vegetable processing by-products (Kosseva, 2011; Pfaltzgraff et al., 2013) as most promising with a view to achieving high-end applications (biosolvents, resins, flavours, fragrance components, various organic acids, enzymes, pharmaceutical products, etc.). 3.2 Key challenges Recovery of specific components generally requires significant processing of material streams. This includes purification, enrichment and/or conversion procedures. Each step will add to both the costs and resources consumption, while unexploited proportions would cause an environmental burden. This highlights that the resulting advanced valorisation strategies necessarily need to include additional valorisation steps in order to make use of the whole value of materials (e.g. in parallel or subsequent production of animal feed, conversion into energy and provision of compost from no longer alternatively exploitable process residues). Implementation of industrial symbiosis is a key success element in such biorefinery strategies. Material streams often show fluctuating composition including varying pH values due to general Venice 2014, Fifth International Symposium on Energy from Biomass and Waste processing and seasonal effects. In addition, due to the fact that their main constituents are organic and moreover they in general have high water content, they are characterised by rapid bacterial contamination and degradation, which makes logistics a decisive factor in framing possible valorisation options. Material supply, logistics and flexible units of operation will be major challenges in large-scale production of commodity chemicals and production of high-value chemicals (Koutinas et al., 2014). High, concentrated volumes are generally of an advantage. Transportation of biomass and any pretreatment such as reduction of water content involve significant costs and require additional initial resources input such as fuel or electricity. Decentralised local or regional solutions, either based on dedicated biorefinery approaches or via integration of by-product utilisation in existing industrial plants, can therefore be assumed as particularly suitable in second-generation valorisation strategies. Major challenges are achievement of economic viability for specific pathways and efficient approach to markets. In order to achieve economies of scale, it will be essential to carefully analyse market opportunities, and furthermore to carefully select the type of feedstock (including consideration of its availability as raw material as well as continuity of quality). 3.3 A spotlight on functional food The present-day consumer is interested in functional food with health benefits above normal nutritive values (Siró et al., 2008), driving the food industry towards the development of functional products that would meet growing consumer demands (Bigliardi and Galati, 2013). Functional food ingredients that can improve public health due to their bioactive properties are currently mostly derived from primary human food. At the same time, by-products generated during industrial food processing contain valuable primary and secondary metabolites that can be recovered and reintegrated into the food system, potentially leading to the development of niche markets for the new ingredients within the agri-food economy. This strategy contributes to public health promotion in addition to ensuring efficient resources use along with reduced environmental impact and (especially relevant for small businesses) cost associated with waste disposal. As one exemplary high-potential area, it appears that the utilisation of low-value protein-rich food by-products for peptide-based functional food development can be a major driver of bioactive peptide research (Udenigwe, 2014), highlighting the strong prospects of agro-industrial waste valorisation in generating high-value products. The consumption of food, especially fruits and vegetables, has been correlated with positive health outcomes including reduction of risk to major human chronic health conditions, especially cardiovascular disease (Dauchet et al., 2006). Therefore, by-products generated from these foods can harbour some functional compounds. Valorisation of food by-products containing functional compounds can be achieved by direct consumption for nutritional purposes or their use as sources of bioactive compounds, often concentrated in the by-products, which can be extracted for nutraceutical and pharmaceutical applications. Currently, food by-products that can be valorised for functional ingredients include oilseed meal, fruit and vegetable pomace, cereal straw, seed hull or husk, fruit peels and fish processing by-products. Food by-products contain several functional molecules including proteins and peptides, polyphenols, carotenoids, polyunsaturated fatty acids (PUFAs) and polysaccharides. For a detailed overview please see Kusch et al. (2014). The macromolecules can be reused in food as nutrients and the secondary metabolites as functional agents that can regulate abnormal physiological processes during disease states. Abovementioned by-products from food processing are currently mostly underutilised. Better utilisation will require efficient isolation and recovery. Various technologies are available and under further research. By-product proteins can be isolated by solubilisation, isoelectric precipitation and membrane technologies (Smithers, 2008; Udenigwe and Aluko, 2012; Rodrigues et al., 2012) for product development and nutritional purposes. Bioactive peptides can be generated from recovered Venice 2014, Fifth International Symposium on Energy from Biomass and Waste proteins using processing technologies such as microbial fermentation, enzymatic hydrolysis and membrane technology (Gómez-Guillén et al., 2011; Udenigwe and Aluko, 2012). Extraction technologies for recovering secondary metabolites include enzymatic treatment, solvent and supercritical fluid extraction, and membrane processing. Oils are traditionally recovered by hydraulic pressing but enzymatic and solvent extraction are becoming popular. Considering the nutritive and therapeutic values of ingredients, valorisation of food by-products for functional food application is certainly a major process to consider for a sustainable food system. However, there are potential challenges to be considered prior to commercialising byproducts-generated functional foods. Major challenges are related to achieving economies of scale, to overcoming regulatory constraints and to achieving acceptance for the products. Among others, the following issues need to be addressed and will require further research: Economic viability of food by-product valorisation for the functional food industry. This includes availability of affordable processing technology that can efficiently extract the valuable ingredients (including applications in small- and medium-scale enterprises, low-income food processors and farmers in developing countries, for widespread implementation of the strategy). Quantities and qualities of functional ingredients, and assessment of possible trade-offs. This includes determination of what fractions of the food waste constitutes are of interest, how much can be extracted, evaluation of any further by-products resulting from valorisation and costbenefit analyses. Health and safety issues, regulatory hurdles. Resulting functional food products need to have the opportunity to be marketed with health claims and safe for human consumption. Different regulations in different countries need to be considered. Consumer perception. Market success will depend on acceptance by final consumers. Possible constraints could result from concerns that the products might be inferior and perhaps unsafe for consumer health. 4. CONCLUSIONS Wastes and by-products occurring in the food supply chain are currently only partially valorised at different value-added levels. The main volumes are managed as waste of an environmental concern, which is not acceptale under consideration of sustainability criteria. Major valorisation pathways today include spreading to land, animal feed, composting and anaerobic digestion. While such firstgeneration valorisation pathways aiming to make use of the material streams as they occur can be considered as state-of-the-art, the main challenge lies in more widespread implementation and in increasing overall efficiency e.g. via cascaded use. Second-generation valorisation pathways are based on recognising that these material streams are rich in components useful for production of commodity or fine chemicals and biomaterials. It is a key challenge to efficiently integrate tailored recovery and conversion procedures in order to obtain sequentially all of the main classes of products, from fine and pharmaceutical chemicals (which in general have higher market values) to commodity products and biofuels (which have lower market value but in general better approachable markets). A huge number of possible valorisation pathways exist, of which some are currently under research and evaluation. Although a range of specific challenges need to be addressed, consideration of functional food is of particual attractiveness, not only due to a wide variety of possible applications, but also due to the fact that using constituents from food wastes and by-products in functional food production means closing cycles within the food supply chain at high added value. Venice 2014, Fifth International Symposium on Energy from Biomass and Waste REFERENCES Angenent L.T., Karim K., Al-Dahhan M.H., Wrenn B.A., Domìguez-Espinosa R. 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