China’s bioplastics manufactur-ing industry continues to grow. While most production today is targeted for export, domestic de-mand is rising rapidly.

Overall bioplastics capacity in China today is around 7,000 tonnes/year with more capacity expected this year if several an-nounced plant start-ups actually come online, said Jim Lunt, man-aging director of US consulting firm Jim Lunt & Associates.

“Current bioplastics demand in China is still quite small due to higher price but is beginning to grow in some niche applications such as cosmetics in Hong Kong,” said Lunt. “

Also, the concern by the Chi-nese government on the use of oil for plastics, driven by overall in-creasing oil demand, is creating domestic interest in bioplastics – particularly the starch blends which tend to be cheaper than products such as polyhydroxyal-kanoates (PHAs) and polylactic acid (PLA).”

Most of the current bioplastics produced in China are mainly for export instead of domestic sale because of its high price, accord-ing to China-based consultancy CCM International. “Still, bio-plastics production in China is expected to grow steadily with the increasing demand from abroad. We consider the growth rate of bioplastics demand in China to be over 20% in the next five years,” it said.

The consultancy, in its China Polylactic Acid report, published in May, estimated China PLA production capacity at 19,300 tonnes/year with manufacturers that include Zhejiang Hisun Bio-materials (5,000 tonnes/year), Shenzhen BrightChina Industrial (10,000 tonnes/year), Shanghai Tong-jie-liang Biomaterials (1,000 tonnes/year), Nantong Jiuding Biological Engineering (3,000 tonnes/year) and Wuhan Gude (300 tonnes/year).

PLA is a bioplastics made from renewable resources such as corn and cassava, and can compete with most conventional thermo-plastics in terms of properties such as strength, elastic recovery, heat, and sealability, in certain applications.

Plastics end-users had been slow to adopt PLA because of the price premium over conventional polymers such as polypropylene (PP) and polystyrene (PS) but a shrinking price gap between PLA and conventional polymers gives plastics end-users more incen-tives to use PLA as an alternative, according to Steve Davies, mar-keting director for US-based Na-tureWorks, the world’s largest PLA producer owned by US agri-business firm Cargill, who spoke on the sidelines of the four-day ChinaPlas exhibition in

Guangzhou, China, held in May.In China, most PLA manufac-

turers have adopted the produc-tion technology of ring-opening polymerization of lactide, which is similar to PLA production in Europe and the US, reported CCM. “Only one manufacturer, Shanghai Tong-jie-liang, uses the PLA production technology of di-rect polycondensation of lactic acid, which is less adopted abroad. Right now, China’s PLA production cost is higher com-

pared to those in the US such as NatureWorks,” CCM said.

Like PHA, most PLA and its end products are also exported because of their higher price. “Im-ported PLA into China is also ex-pensive because of the very high import duty at 45% compared to other Asian nations that are typi-cally 6.5%,” CCM said.

Still, demand for PLA in China is expected to grow to over 2m tonnes in 2015, according to

CCM. Major domestic PLA manu-facturers are already expanding their capacities in order to grab more market share in the future. Two producers are expected to launch new production lines by year-end, CCM said.

“China’s PLA industry is still at an early stage of development, but it has great potential in the fu-ture, aided by government sup-port and increasing public envi-ronmental awareness. The pollution generated by plastics production is becoming more se-rious. If PLA’s price can be re-duced, its growth rate will be-come much higher,” CCM added.

DELIVERED IN BULKNatureWorks’ PLA marketed under the Ingeo brand is priced at $0.90–1.00/lb (€0.62–0.68/lb) de-livered in bulk in the US, close to the US prices of conventional polymers such as PP and PS, said Davies. The company produces PLA at its 140,000 tonnes/year plant in Blair, Nebraska, US, and plans to build its second plant ei-ther in Thailand, Malaysia or Sin-gapore because of growing de-mand for PLA in Asia.

NatureWorks plans to specify the location later this year, the company said. The new plant could come on line in 2015.

NatureWorks announced in

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Australia0.2%

North America32.9%

Europe18.3%

Asia28.1%

South America20.5%

SOURCE: European Bioplastics

PRODUCTION CAPACITY OF BIOPOLYMERS IN 2015

in total: 1.71m tonnes

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BIOPLASTICS DORIS DE GUZMAN NEW YORK

Bioplastics industry grows in ChinaChina’s bioplastics production increases to meet growing export demand as well as future domestic consumption

“China’s PLAproduction costis higher compared tothose in the US, suchas NatureWorks”CCM INTERNATIONAL

China has a fast-developing market for bioplastics, particularly the starch blends

ICB_130611_022-023 22 8/6/11 15:51:48

June 13-19, 2011 | ICIS Chemical Business | 23www.icis.com

March that it has started selling Ingeo packaging resin grades di-rectly to customers after ending its exclusive distribution agree-ment with a Taiwanese company. Taiwan has long been one of the pioneers in the production of PLA-based packaging materials.

“NatureWorks has experienced significant business growth in Taiwan and decided to continue that growth by forging closer technical and commercial rela-tions with large-scale packaging customers there,” said Nature-Works CEO Marc Verbruggen.

MULTIPLE SALES CHANNELSBut NatureWorks still continues to supply Ingeo packaging resin through its existing Taiwanese distributor to provide multiple sales channel options for local customers, said Verbruggen. “Tai-wan-based companies are among the largest customers of Ingeo-based products worldwide, and Asia is NatureWorks’ fastes grow-ing sales region,” he said.

Taiwan currently exports about 65% of its finished products made from PLA, said Clover Chang, Taiwan-based director for the US Grains Council, a private, non-profit corporation founded by US agribusinesses and various grain producer organizations. Wei Mon Industry of Taiwan is the country’s largest producer of PLA products, noted Chang.

“Wei Mon imports about 10,000 short tons/year of PLA resins from the US to support its growing production,” said Chang. “The company is looking at the Chinese market in particu-lar with plans to extend its busi-ness to the Mainland. As of this year, it has already ordered sev-eral containers of PLA resins to be directly imported from Blair to China.”

To spur rapid introduction of PLA into the Chinese market, Chang noted that China’s govern-ment must develop a policy man-dating a certain percentage of bio-plastics in the production of

single-use disposable food con-tainers in China similar to Tai-wan’s policy which mandates a 35% usage rate.

PHA PRODUCTION ADVANCESFor PHA, there are three major producers in China, namely Tian-jin Green Bioscience, Shenzhen Ecomann Biotechnology, and Ningbo Tianan Biological Materi-al, with total capacity of 17,000 tonnes/year, reported CCM.

Ningbo Tianan Biological Ma-terial has 2,000 tonnes/year of ca-pacity and mostly sells its prod-ucts to Europe and the US, said Lunt. It wants to expand its capac-ity to 10,000 tonnes/year, he said.

Shenzhen Ecomann’s second-phase PHA project, which will raise its capacity from 5,000 tonnes/year to 50,000 tonnes/year is still under environmental im-pact assessment and land evalua-tion, noted Lunt. “The construc-tion was estimated to start in April or May this year. As of yet, none of their product appears to

be in the marketplace,” he said.Tianjin Green Bioscience, in

which Dutch chemical firm DSM has invested, is completing a 10,000 tonne/year facility for PHA but is not yet producing, said Lunt. He estimates growth rates for domestic bioplastics con-sumption in China to be around 40 percent per year for the next few years as the standard of living continues to increase in the re-gion. “The overall growth rate in China will probably be higher than in other geographies since they are starting from a much lower demand base,” said Lunt.

“The challenge is that the bio-plastics price in China will re-main higher than conventional plastics for some time, which will limit domestic use. On the other hand, China will be able to sup-ply Asia – mainly Korea, Taiwan and maybe Japan where their de-livered costs could be lower than from the US,” he added. Additional reporting by Bee Lin

Chow in Singapore

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