Dow and Mitsui postpone sugarcane polymer plant

Bob Moser

Published: January 10, 2013 6:00 am ET

Related to this story

Topics Sustainability, Materials, Suppliers

SÃO PAULO, BRAZIL (Jan. 10, 1:30 p.m. ET) — Dow Chemical Co. and Japanese trading company Mitsui & Co. Ltd. will postpone plans to build a plant for sugarcane ethanol-based plastics, citing rising design and construction costs and land ownership laws in Brazil for the indefinite delay, Plastics News confirmed this week.

The green plastics project, first announced in 2007, had been slated to break ground this year on a biopolymers facility in Santa Vitoria, Minas Gerais state, at a projected cost of US$1.5 billion. Dow formed a joint venture with Mitsui in July 2011, with plans to plant and harvest their own sugarcane, build an ethanol plant with 2.7 million metric tons of cane capacity, and follow it with an ethanol-to-ethylene and biopolymers plant. The entire complex was originally slated to begin operating later this year.

Dow told Plastics News it and Mitsui will postpone phase two, building the plastics plant. The first phase, which includes expanding sugarcane plantations and building an ethanol plant, remains on schedule. The companies currently have about 50,000 acres of first-generation cane growing and plan to harvest in 2014.

“The Santa Vitoria project is of high strategic importance to Down and Mitsui, and the construction of the first phase for sugarcane ethanol production is proceeding as scheduled,” Midland, Mich.-based Dow said. “The two companies continue to work together to mitigate and eliminate barriers to proceed with the second phase as soon as possible.”

Since 2007, a handful of other ethanol-based plastics projects have been announced in Brazil, but only Braskem SA has been able to follow through. Its first “green” plastics factory began operating in the second half of 2010, in Triunfo, Rio Grande do Sul state. Braskem has announced plans for a second polyethylene plant in Brazil’s center-south region and a third plant for ethanol-based polypropylene, but firm details on either project haven’t been provided.

During IHS’ Latin American Petrochemicals & Polymers Conference, held in May in São Paulo, Braskem and Dow officials said “green” PE easily draws a premium of 40 percent or more from clients eager for an enviro-marketing edge, and Braskem’s product was already cost-competitive with naphtha.

South America remains a net PE importer, with 2.6 million tons imported in 2011 and an average annual growth rate of 6.6 percent expected by IHS through 2016. Brazil’s PE imports should grow at 9 percent per year, reaching 1.2 million tons by 2016.

In the short term, Dow will focus on its most profitable segments, particularly in the United States with shale gas reserves. Dow is investing $4 billion in the U.S. Gulf Coast to boost ethylene and propylene capacity through 2017.


Comments

Dow and Mitsui postpone sugarcane polymer plant

Bob Moser

Published: January 10, 2013 6:00 am ET

Post Your Comments


Back to story


More stories

Image

2014 leaves some resin firms in the black while others struggle

January 23, 2015 2:37 pm ET

On the financial side, 2014 was good for Hexcel Corp., so-so for Celanese Corp. and it could have been better for Omnova Solutions.    More

Image

Berry's rebranded Blue Clover expands packaging design reach

January 23, 2015 1:59 pm ET

As design director of Berry Plastics Corp.'s rebranded packaging design studio, Scott Fisher believes the new name of Blue Clover Studios cuts the...    More

Image

Clariant's ColorForward predicts future consumer trends

January 23, 2015 1:33 pm ET

Clariant International Ltd. is marking a decade of color forecasting with the 10th edition of its ColorForward program.    More

Image

The future for PolyOne is colorful

January 23, 2015 1:28 pm ET

PolyOne Corp. is writing four color stories for 2016.    More

Image

Mexico's Polymer Solutions looks to grow, expand offerings with name change

January 23, 2015 12:03 pm ET

British biodegradable additives developer Symphony Environmental Technologies plc's Mexico distributor has changed its name from Plásticos Degradables...    More

Market Reports

Plastics in Automotive: Innovation & Emerging Trends

This special report newly released by PN and sponsored by The Conair Group examines current trends in the use of plastics in automotive, materials innovations and the changing landscape. It includes a review of legislative/regulatory activity impacting vehicle development and lightweighting, market opportunities & challenges for mold and toolmakers, innovative design strategies being implemented by major OEMs and suppliers, as well as a review of key indicators in Canada, Mexico, Brazil and China.

Learn more

Plastics Recycling Trends in North America

This report is a review and analysis of the North American Plastics Recycling Industry, including key trends and statistics based on 2013 performance. We examine market environment factors, regulatory issues, industry challenges, key drivers and emerging trends in post-consumer and post-industrial recycling.

Learn more

Injection Molding Market Analysis & Processor Rankings

Plastics News BUNDLED package contains our in-depth Market Analysis of the Injection Molding segment. You will gain keen insight on current trends and our economic outlook.

As a BONUS this includes PN's updated 2014 database of North American Injection Molders RANKED by sales volume. Sort, merge, mail & prospect by end market, materials processed, region, # of plants and more.

Learn more

Upcoming Plastics News Events

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 16, 2015 - September 18, 2015Plastics Caps & Closures - September 2015

More Events