US Coca-Cola bets on plant-based plastic despite higher costs

18 November 2009 22:25  [Source: ICIS news]

HOUSTON (ICIS news)--Coca-Cola is betting its new plant-based polyethylene terephthalate (PET) bottle will attract sufficient market share to outweigh its higher manufacturing costs, a company source said on Wednesday.

The container is called the PlantBottle and uses PET feedstock monoethylene glycol (MEG) made from sugarcane and molasses that is processed into ethanol.

A Coca-Cola source who did not wish to be named declined to say by how much costs increased for MEG made from plants rather than petroleum, but said the plant-based process is more expensive.

“This is not a cost-driven initiative, there is actually a cost disadvantage. This is a sustainability-driven initiative,” the source said.

He said feedback on the PlantBottle has been positive from consumers who see it as differentiating Coca-Cola from other beverage bottlers.

For the largest beverage company in a global market dominated by few players, improving market share often hinges on a company’s ability to capture consumers’ attention in ways that differentiate it from major competitors, the source said.

Rollout of the new packaging in North America will start in western Canada ahead of the Vancouver 2010 Winter Olympic Games, and will be followed by introduction into markets of the western United States, including Seattle, San Francisco and Los Angeles.

Initial product offerings for the plant-based PET bottle will include water and some carbonated soft drinks, although Coca-Cola is looking to expand into other beverage markets.

Plant-based PET retains all the recycleability and physical properties that have made its crude oil cousin the preferred material in beverage packaging, the Coca-Cola source said.

This gives it an advantage over other plant-based and biodegradable polymers such as those made from lactic acid, which pollute the recycling stream and cannot offer the properties of PET, Waterman said.

According to a Coca-Cola press release, the company wants to eventually produce the MEG feedstock from non-food, plant-based waste, such as wood chips or wheat stalks.

The source declined to say which PET producers will initially produce the resin using sugarcane-based MEG, the feedstock that composes around one-third of PET.

North American PET producers include DAK Americas, Eastman, Indorama, Invista, Mossi & Ghisolfi, Nanya and Wellman.

($1 = €0.67)

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By: Landon Feller
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