The increasing use of industrial biotechnology by the Chinese liquid biofuels and chemical industries is expected to help offset energy security and environmental concerns generated by China’s robust economic growth. The expanding use of bioprocesses to produce products such as fuel ethanol and bioplastics is also likely to contribute to continued innovation, productivity gains, and cost savings. This, combined with strong government promotion of the country’s bio-based economy, coincides with the two industries’ growing global prominence; China is currently the world’s third largest producer of ethanol and second largest producer of chemicals. This growth has encouraged expanded domestic and foreign investment, including in bio-based projects, and generated related gains in exports, particularly in the chemical industry. Market conditions facing many ongoing and prospective ventures, however, are changing as a result of a combination of factors, including the strength of the Chinese currency, new labor regulations, tax changes, and volatile energy prices.