Capital City Packaging Inc. plans to use a $3.6 million state grant to help start a business to recycle post-consumer PET into food packaging such as fruit baskets, trays and clamshell packaging.
``We're anticipating that we'll be ready by the end of year,'' said Kenny Luong, vice president and project director, in a Feb. 19 telephone interview.
He said the new company is looking at sites in the McClellan Business Park in Sacramento, Calif. It is seeking about 50,000 square feet to house a sheet extrusion and thermoforming operation.
Luong says there is a great opportunity for recycled PET, and the state agrees.
``There's a tremendous number of PET containers, and we don't have a great deal of capacity [to recycle in the state]. A lot of it is shipped out of state and to China,'' said Mark Oldfield, spokesman for the California Department of Conservation.
``This grant actually helps add manufacturing for recycled feedstock,'' he added.
The money comes from unclaimed deposit funds raised from the state's bottle bill. Luong and his undisclosed partners will invest more than $1 million of their own capital to get started.
Luong noted that the company already has sent out samples and has been lining up customers.
He is president of Ming's Recycling Corp. of Sacramento, and his company will collect and provide PET bottles to start the process. Luong said his business will outsource the reprocessing of the resin and will buy back clean PET flake that are suitable for food packaging. Capital City will extrude the flake into sheet and thermoform it into products.
The company has lined up a distributor for its products, which will target customers such as school systems looking to use recycled-content goods, Luong said.