Co-product

A co-product is a secondary product derived from the production of a primary product. It's generated simultaneously with the main item, often resulting from the same production process or using the same raw materials. Unlike by-products, which are often considered waste or have lower economic value, co-products typically hold significant market value and contribute to overall profitability. Co-products are intentionally created and sold, representing a strategic element in resource optimization and waste reduction efforts in various industries.

Co-product meaning with examples

• In the dairy industry, milk is the primary product, while cream, butter, and whey are valuable co-products. Companies optimize production to maximize these outputs. This synergistic approach generates revenue streams from multiple sources, leading to a more efficient use of resources, and minimizes waste in the production process.
• The corn wet milling process yields corn starch as the main product. Co-products include corn oil, gluten feed, and gluten meal, all of which are sold for animal feed and other industrial applications. Careful processing ensures that maximum value is derived from all raw materials, reducing the overall cost of production.
• Refining crude oil generates gasoline and other fuels as the primary products. Co-products like asphalt, lubricants, and petrochemical feedstocks are then used in a variety of industrial applications. Optimization of the refinery to maximize co-product yield enhances profitability and contributes to the circular economy.
• The lumber industry produces sawn timber as the main product. Wood chips and sawdust are then utilized as co-products for paper production and particleboard manufacturing. Effectively using these co-products reduces waste and improves the economic viability of timber harvesting and processing.