Dow Chemical Co. is partnering with Mitsui & Co. Ltd. to create one of the world's largest biopolymers operations.
Midland, Mich.-based Dow and Mitsui of Tokyo will become 50-50 partners in Dow's sugar-cane operation in Santa Vitoria, Brazil. The venture will produce sugar-cane-based ethanol, which will be used to make sugar-based polyethylene.
Although no capacity total for the plant was listed in a July 19 news release from the firms, Dow and Mitsui claim it will be “the world's largest integrated facility for the production of bipolymers made from renewable, sugar cane-derived ethanol.”
No investment estimate was available for Dow, but Mitsui officials said their initial investment will be about $200 million.
“This landmark move underscores Dow's commitment to invest for growth in high-value, innovation-rich sectors through stra- tegic partnerships,” Dow Chairman and CEO Andrew Liveris said.
“It also combines the strengths of two global companies, creating the unique combination of world-leading technology and renewable feedstocks to meet needs in an important, rapidly growing region of the world.”
Biopolymers produced at the facility will be a green alternative and drop-in replacement for high-performance flexible packaging, hygiene and medical markets, offering customers the same performance attributes with a more sustainable environmental profile, officials added.
“This venture advances Mitsui's goal to contribute to industry and society by securing a stable supply of renewable resources and providing sustainable solutions from those resources,” said Masami Iijima, Mitsui's president and CEO.
The first phase of the project includes constructing a new sugarcane-to-ethanol production facility in Santa Vitoria, to begin in the third quarter. The plant's bioplastics will be sold worldwide.
The plant will be Brazil's second major bioplastics plant. Last year, Brazilian plastics giant Braskem SA opened a 440 million-pound-capacity plant making sugar-based polyethylene in Triunfo.
Braskem is developing plans for a sugar-based PP plant, possibly in Triunfo, that will have capacity of almost 70 million pounds.
Dow — one of the world's largest plastics and chemicals makers — has operated in Brazil since 1956 but doesn't have major plastics assets there.
Mitsui's plastics and chemicals portfolio includes PET, PE, polypropylene and related feedstocks; and it owns German polycarbonate maker Hi-Bis GmbH. Mitsui Chemicals already makes its own Lacea-brand bioplastic resin.
At one point, Dow had planned to build a bio-based PE plant in Bahia Blanca, but those plans were cooled when the global economy slowed down.
“Our customers have said over and over that they want green-based plastics,” Dow spokesman Bob Plishka said July 21 by phone.
As recently as 2007, Dow had announced plans to build a sugar-based PE plant in Brazil through an alliance with Brazilian ethanol maker Crystalsev. Those plans were scuttled by Crystalsev's financial problems.
Dow owns about 42,000 acres of sugar-bearing land in Brazil that it had bought to supply the Crystalsev project. It currently sells output into local sugar markets.
The Dow-Mitsui venture isn't the first time Dow has made a move into bioplastics. In 1997, Dow formed NatureWorks LLC, a bioplastics joint venture, with agricultural firm Cargill Inc.
NatureWorks built a large plant making corn-based polylactic acid bioplastics in Blair, Neb., but Dow exited the partnership in 2005 for unspecified reasons.