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Topics Materials Public Policy Sustainability Asia Materials Suppliers
Companies & Associations NatureWorks LLC
SHANGHAI — NatureWorks LLC will make a decision about the location of its second plant by the end of this year.
Speaking at the China International Biobased Technology & Partnering Conference in Shanghai, Asia-Pacific commercial director Richard Weber said Thailand is the preferred location, but an unstable government there still leaves the decision up in the air.
“[Thailand] has been our preferred location but we haven’t necessarily purchased or leased the land effectively. The final decision still hasn’t been made,” he said.
Early on in the interview he did refer to the plant as “our Thai plant,” and later in the day he was seen lunching with Thailand Bioplastics Industry Association President Pipat Weerathaworn. But in Weerathaworn’s presentation, he expressed hope — but not certainty — that Minnetonka, Minn.-based NatureWorks would indeed locate a plant there.
“The Thai government is very interested in building this bio-based economy,” Weber said, pointing out that Thailand is a major exporter of sugar cane and cassava.
“They’re really interested in, rather than just exporting the raw materials, converting [them] into a valuated product like our Ingeo [polylactic acid resin],” Weber said.
But both Weerathaworn and Weber alluded to Thailand’s unstable government as a challenge for cooperation.
“However without the government in place they haven’t been able to put through the final incentive packages that were on the docket, which would be helpful to our second plant. It hasn’t impacted it [our decision] yet, and Thailand remains our preferred location, but it is something that we are closely monitoring and working on with the government through one of our parent companies,” Weber said.
On May 22, the Thai military took control of the country from its elected government, the second coup in the country in the past decade. The military action took place after months of protests in the capital of Bangkok and other major cities.
Weber added that other options for NatureWorks would be Malaysia or Singapore.
The new plant is currently in detailed engineering stage, said Weber. He estimated it will start operating around 2016.
Capacity details have not been made public. NatureWorks’ current manufacturing plant in the United States has a capacity of 150,000 metric tons (350 million pounds) per year, and the new factory will either be 150,000 or 75,000 metric tons, he said.
NatureWorks anticipates plans for a third plant around 2020.
NatureWorks hit their 1 billion pound total aggregate sales target last year, Weber said. “By hitting this milestone figure we believe it shows PLA has proven it can play a significant role in the plastics market, and there fore the next goal for the industry is to get to 1 billion pounds a year.”
“One thing that we think would also be key to having the industry take off is if there was additional commercial suppliers in the marketplace,” he said. “Today, the only real commercial supplier is NatureWorks, with one plant.”
He added that the company welcomes competition and is even trying to help create it.
“We are actively looking for partnerships or licensing opportunities to create credible competition,” he said. “The key to unlocking the potential for PLA business is competition [from] multiple commercial suppliers [so that companies] can feel comfortable switching significant portions of their portfolio to a new product,” he said.
Weber said the company has matured over the years in its thinking about the prospects of bioplastics.
“We know that what actually gets the sale or drives significant demand is going to be the price and performance. You can’t just rely on selling the green concept,” he said.
“Before we were green, green, green.” Now the company knows that “we can compete with polystyrene in North America, and increasingly the rest of the world as styrene prices continue to escalate and that’s what’s going to cause PLA to take off,” he said.