31 March 2011 18:26 [Source: ICB]
Consumers are increasingly seeking sustainable solutions. This will boost demand for biodegradable plastics - as long as the composting infrastructure is in place
Rising interest in biodegradable plastics is good news for the bioplastics sector. But this enthusiasm, on the part of both consumers and governments, must be accompanied by the installation of adequate composting infrastructures - whether at local, regional or national level, says Robert Heger, vice president, specialty plastics, at global chemical company BASF.
BASF, headquartered in Ludwigshafen, Germany, estimates demand for biodegradable and bio-based plastics will grow by 20-30% during the next few years, helped by rising consumer demand, new environmental regulations and the development of new technologies and applications.
Establishing the composting infrastructure and waste management system for collecting and separating organic waste is essential for the development of the market for biodegradable plastics, Heger says. While some European countries have an advanced infrastructure for organic waste collection, progress is needed in other regions.
BASF is working with municipalities to develop the necessary infrastructure for collecting organic waste. The aim is to convince municipalities that by setting up the necessary infrastructure they can save money and help reduce carbon dioxide emissions. "The separation of organic waste has the potential to save money and also reduce greenhouse gas emissions," Heger remarks.
The company was involved in a pilot project to promote the use of biodegradable bags and build composting facilities in Thailand, and is launching a pilot project in Bad Durkheim, near Ludwigshafen. It is also in discussions with China about introducing a separate waste management system for organic waste, Heger says, and intends to expand such programs to other regions and countries.
In emerging markets, local solutions could be easier to implement than national ones. Thailand, for example, has no composting infrastructure but local solutions involving small-scale composting facilities could be appropriate. "You don't necessarily need total regulations for a country, but you could invest in a mobile composting facility in a village and at the end of the process, you have a valuable product that could be put on the fields," Heger says.
BASF produces the biodegradable polymer Ecoflex and derivative product Ecovio. Ecoflex, an aliphatic-aromatic copolyester, acts as an enabler by improving the flexibility of other polymers such as polylactic acid (PLA) and starch. Ecovio is a blend of Ecoflex and corn sugar-based PLA.
While BASF's Ecoflex is biodegradable, it is not generally produced from bio-based materials. However, BASF has launched another Ecovio plastic grade, branded Ecovio FS Paper, for lining paper cups, which is manufactured using partly bio-based Ecoflex. BASF has not disclosed which of the three raw materials used to produce Ecoflex - butanediol, terephthalic acid and adipic acid - is bio-based in the Ecovio FS Paper grade. In theory, each could be exchanged with a bio-based material, Heger says.
Europe is the biggest market for Ecoflex and Ecovio, with bags the largest application. Germany has a particularly advanced infrastructure for biodegradable polymers, Heger says, and strong demand is expected in Italy following the introduction of a law in January banning the use of non-biodegradable single-use bags.
BASF is also forecasting strong growth for the products in North America, as well as in Japan and Australia. In the US, government initiatives promoting the use of renewable raw materials and feedstocks are expected to help boost sales of biodegradable plastics.
Earlier this year, BASF reached an agreement with US bioplastics manufacturer Metabolix which enables the German producer to sell Ecovio in the US. Under the agreement, BASF has acquired a license from Metabolix under a US patent to produce and market PLA and polybutylene adipate terephthalic acid (PBAT) compounds under its Ecovio trade name.
Legislation supporting the use of biodegradable packaging can help boost demand, but it is not necessarily the best route, Heger notes. It is more important to convince the consumers and brand owners of the products' benefits, he suggests.
While Italy's plastic bag ban is creating additional demand for biodegradable plastics, this effect is less obvious in countries lacking that infrastructure, such as China, where a plastic bag ban was introduced in 2008.
"In China, people can buy biodegradable and compostable bags but there is no infrastructure, no composting facilities, so this plastics ban does not solve the littering issue," Heger explains.
Other growth areas include agricultural mulch films, films for lining paper products such as cups, and disposable cutlery and plates. Agricultural mulch films, which are used to improve farming productivity, can be tilled into the soil at the end of a growing season, unlike polyethylene (PE) films which have to be removed and then either cleaned or sent to landfill.
"In countries with high labor costs, it can be cheaper for the farmers to use a biodegradable mulch film that does not need to be removed afterwards," Heger says.
According to global market research and consulting company Applied Market Information, the market for agricultural films was 3.6m tonnes in 2008.
Using biodegradable films to line paper cups allows the cup to be recycled or composted. Paper cups are normally lined with PE, which causes problems with recycling because PE does not dissolve in the recycling process, Heger explains. "We can achieve the same mechanical and product properties with Ecovio film, such as resistance to moisture and grease, but it does not harm the recycling process," he says.
BASF estimates the global market for whole paper cup material, including the paper and plastic coating, at 1.3m-1.5m tonnes.
Heger notes that sporting events present significant opportunities for using biodegradable catering products, because the cups, plates and cutlery can be collected together with the organic waste for composting.
BASF is talking to organizers of sporting events and there has already been some interest in the use of biodegradable waste bags for the Olympics, he says.
Potential future products include biodegradable foams for applications such as food trays and cups. Ecovio foam products could be combined with biodegradable clingfilm and shrink film to provide a complete food packaging system in which all pieces are biodegradable, Heger says.
BASF is also developing plastics that can biodegrade under anaerobic conditions, although it is not clear whether these products would be based on Ecoflex. "We are trying to do so but we are also looking in other directions," Heger says. One potential solution is a blend of polyhydroxyalkanoate (PHA) and Ecoflex, he adds.
To support rising demand for biodegradable plastics, manufacturers are investing in new production capacity. BASF has expanded its Ecoflex and Ecovio production capacity in Ludwigshafen and global companies such as NatureWorks and Telles, both based in the US, are also investing in new capacity.
"The separation of organic waste has the potential to save money and also reduce greenhouse gas emissions"
Vice president, specialty plastics, BASF
BASF expanded its Ecoflex capacity by 60,000 tonnes/year to 74,000 tonnes/year earlier this year, and production capacity for Ecovio was raised to 15,000 tonnes/year with the ability to scale up in line with demand.
The board approved the expansion project at the beginning of the financial crisis, demonstrating the company's huge confidence in this emerging biodegradable plastics business, Heger says. "It's a great business opportunity based on long-term trends," he adds.
NatureWorks, the world's largest PLA producer, has a 140,000 tonne/year PLA plant in Blair, Nebraska in the US, and is studying potential locations for a second plant.
The company says it is looking at locations in Europe, Asia Pacific and South America for the project, expected to have a 140,000 tonne/year capacity.
Telles, a joint venture between Metabolix and Archer Daniels Midland, started up its 110m lbs/year, PHA-based resins plant in Clinton, Iowa, US, last year. According to Metabolix, capacity utilization levels at the plant will be ramped up as production processes are optimized and demand increases.
For the time being, BASF intends to satisfy all demand for Ecoflex and Ecovio from its Ludwigshafen site. When the Ludwigshafen plant is sold out, BASF would consider either debottlenecking the plant - the cheapest solution - or building a new plant, says Heger.
The location of a new plant would depend on factors such as BASF's existing global production infrastructure, market conditions and the investment cost. "All these factors will be taken into account and we will see which is the best site to build a potential new plant," he says.
The bioplastics market is extremely dynamic and the introduction of new legislation makes it difficult to predict when additional capacity will be required, Heger says. "There is an underlying trend towards sustainability globally. I'm not saying that biodegradable plastics will save the world, but they can contribute to sustainable solutions," he adds.
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