Bioplastics – Hot in Italy?

Is the global bioplastic industry already benefiting from plastic bag ban in Italy? US-based Cereplast thinks so as it currently goes through its construction plans of a 100,000 tonne/year bioplastic facility in Assissi (Cannara), Italy.

“After exploring possible sites in several countries in Europe, we identified a central location in Italy, where we have established several strong distribution relationships. In addition, the Italian government has expressed its strong support for the development and use of bioplastics, therefore it was the obvious location choice for our plant.” – Frederic Scheer, Cereplast CEO.

According to Scheer, 85% of their business is already based in Europe, where bioplastic demand is expected to reach 1m tons by 2014. The European bioplastics market is growing by 15-20%/year according to the European Bioplastic Association.

Cereplast’s plant will be financed through local and regional financing with Italian institutions and is expected to receive subsidies from various state and local agencies. The initial investment is estimated to be about €10 million to €12 million. In the company’s recent earnings call, Scheer noted that Cereplast is continuing to benefit from plastic bag ban legislation such as in Italy, where it came into effect on January 1 this year.

According to an article from ICIS, the Italian plastic bag industry uses between 200,000 and 250,000 tonnes/year of polyethylene (PE), low density PE (LLDPE), high density PE (HDPE) and linear low density PE (LLDPE). The article also compared lower plastic bag demand in Ireland and France following similar legal measures. (Ireland placed taxes on single-use plastic bags since 2002).

I don’t know if the plastic bag bans contribute to several other recent bioplastic investment activities announced for Italy or is it because there are already nice plastic manufacturing infrastructure there as well as good feedstock sourcing –or maybe combination of all of the above.

One is the announcement from DSM, in partnership with Roquette, who plans to open a commercial-scale 10,000 tons/year bio-succinic acid plant in Cassano Spinola, Italy, by the second half of 2012. For those who are not familiar with succinic acid, it is a chemical building block for the manufacture of a lot of products but its use for polymers production seem to be standing out more often. The joint venture said they will focus on new applications for succinic acid in materials such as polybutylene succinate (Pbs) and 1,4 butanediol (BDO).

My colleague Anna Jagger actually wrote a more comprehensive article about the announcement for ICIS Chemical Business (subcription only for this one – sorry…). DSM and Roquette said they will consider building a larger facility in the future if demand for ­biosuccinic acid develops in line with expectations.

I asked DSM why Italy. Here’s their answer:

“We investigated multiple global options and used several criteria to make the selection. We looked at the market, sustainability, production costs, availability of feedstocks (integration in an existing biorefinery). We also realized that this is our first production plant, that is a step in our strategy to a larger production facility. Cassano is also a site that is experienced in the fermentative production of e.g. gluconic acid.”

Another announcement was from US-based Genomatica, which is planning to build a cellulosic-based bio-BDO demonstration facility in Rivalta, Italy, in collaboration with engineering firm Chemtex, a subsidiary of Italian plastic producer M&G (Gruppo Mossi & Ghisolfi). Genomatica declined to indicate how much capacity the bio-BDO plant will be although it said that it will immediately move to commercial scale of around 45,000 tonnes/year once the demo has been successfully run, which is expected to be the first half of 2012.

The plant will use a variety of biomass feedstock including energy crops like arundo donax and sorghum; agricultural residues like sugarcane bagasse or wheat and rice straws; and poplar or eucalyptus wood.

Why Italy? “We are locating this facility in Italy because of the proven pilot scale production of PROESA, coupled with M&G’s construction of the largest cellulosic ethanol plant in the world at Crescentino” – Genomatica

The company said they have not yet announced specific distribution for their bio-BDO but have seen very strong demand for bio-based sustainable chemicals in the European market.

Last but not the least, Italian bioplastic producer Novamont said late last year that they are planning to expand their biopolymer production capacity from 80,000 tonnes/year to 150,000 tonnes/year by the end of 2012 or early 2013. Novamont did not disclose the new plant’s location in Italy.

Novamont said sales from their biopolymers has increased 20-30% every year for the past few years.

[Photo by Fashionblabla]

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