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June 21, 2010 02:00 AM

NatureWorks upbeat, PLA products on rise

Mike Verespej
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    Biopolymers resin manufacturer NatureWorks LLC is rising again at a 30 percent clip after a brief period of lower growth. But the company still expects it will be three to four years before its polylactic acid resin plant in Blair, Neb., reaches full capacity.

    “We have gotten back to a 30 percent growth rate in the last six months,” President and CEO Marc Verbruggen said in a phone interview. “A lot of it is organic growth from existing programs, and overall, there is better growth in the economy, both in the U.S. and globally,” he said.

    “The big question is — are we truly seeing a global recovery or will we go back into a recession?

    “We should be able to grow at 30 percent for the foreseeable future,” Verbruggen said. “We are only limited by the ability to put assets in the ground.”

    The Minnetonka, Minn., company initially returned to double-digit growth last spring, shortly after a round of layoffs triggered by the economic downturn that began in fall of 2008.

    Verbruggen said it will take NatureWorks “three to four years to sell out Blair,” whose capacity was doubled last June to 300 million pounds. “We are on track to do that.”

    But he quickly added that NatureWorks is still scheduled to open a second plant — most likely outside the United States — to make its Ingeo PLA resin in late 2013 or early 2014. He said the plant is likely to use industrial sugar or starch as a feedstock instead of corn, which is the feedstock used at the Blair plant.

    “At the moment, we are looking predominantly outside the U.S,” for the location of that second plant, Verbruggen said — because 40 percent of the firm's sales are in Asia and another 20 percent in Europe. The rest of the firm's sales are in North America, with most coming from the United States.

    NatureWorks' plan is to select a site by the middle of next year, and to build a plant that is similar in size to Blair, with capacity for 300 million to 350 million pounds of PLA annually. Manufacturing will begin at only half that amount.

    “If I would have to build it today, I would start operating to produce 150 million pounds annually, but put the infrastructure in place so we could double that,” Verbruggen said.

    Currently, fresh-food packaging and food-service applications account for 30 percent of PLA use, with films contributing another 20 percent, he said. Non-wovens, bottles and semi-durable applications make up the other 50 percent.

    However, he said the film segment “is expanding and growing rapidly right now” — both clear films for wraps and films with metalized layers.

    Earlier this year, Frito-Lay North America Inc. began converting its film for SunChips bags to 100 percent PLA. In addition, pretzel maker Snyder's of Hanover is using PLA for the bags of six different types of pretzels. Those bags are being made by Elk Grove Village, Ill.-based Clear Lam Packaging Inc.

    Clear Lam said the bags can be produced with as little as half the energy of conventional plastics, and can generate as little as 52 percent fewer greenhouse gas emissions in the manufacturing process.

    Verbruggen also said non-wovens “are attracting a lot of attention” for products like wipes and diapers. “I expect a number of large brands to announce products in the next six months,” he said.

    That reflects how the market is changing in terms of the applications for PLA, according to Verbruggen.

    “Consumers are asking for more sustainable products,” he said. “Wal-Mart is asking brand owners to supply them with more sustainable products for their shelves. And there are sustainability demands on brands globally.

    “Three years from now, film will be our largest category, and non-woven and disposables will each be 10 percent or more,” he said. “Non-wovens could be our second-largest segment.”

    The entire food-service segment also continues to grow, “driven by zero-waste initiatives” and the nearly three-dozen bans on polystyrene takeout packaging in California, as well as a PS ban in Seattle that goes into effect July 1, he said.

    In addition, Verbruggen said the PLA resin market is changing as more firms are blending the resin with other polymers, and others creating more PLA grades by incorporating additives to improve properties.

    “There is already a sustainability advantage for PLA, but I see continued growth because, just from an economic standpoint, the advantage is going toward less-volatile feedstocks,” Verbruggen said.

    Copyright 2010 Crain Communications Inc. All Rights Reserved.

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