|Shin Hak-cheol, vice chairman and CEO of LG Chem / Courtesy of LG Chem|
By Baek Byung-yeul
LG Chem will construct bioplastics plants in the United States, as the chemical company agreed to launch a joint venture to produce the eco-friendly materials with Chicago-based Archer Daniels Midland (ADM), according to the Korean company, Tuesday.
LG Chem said it signed the joint venture contract with the U.S. company to build two separate facilities to produce lactic acid (LA) and polylactic acid (PLA).
Under their agreement, they will set up a facility capable of producing up to 150,000 tons of high-purity corn-based lactic acid a year. The second facility will produce about 75,000 tons of PLA annually. The location of the facilities will be at Decatur, Illinois.
"If the joint venture makes 500-milliliter eco-friendly water bottles with 75,000 tons of PLA, we can make around 2.5 billion bottles annually," the company said, adding that the construction will begin in 2023, when the final review by the two companies' boards are completed.
PLA stands for polylactic acid, and is a material for biodegradable bioplastics made from lactic acid (LA) obtained by fermenting corn. Known to be harmless to our body, it is mainly used in food containers, straws, water bottles, tableware and tea bags, LG Chem said.
"PLA is gaining attention as a sustainable eco-friendly material because it can be naturally decomposed and greenhouse gas emissions in the production process are only less than a quarter compared to that of making plastics," LG Chem said.
Industry watchers forecast global demand for bioplastics to grow 22.7 percent annually from $10.7 billion in 2021 to $29.7 billion in 2026.
"We're pleased to expand our collaboration with LG Chem, and we're excited at the opportunity to bring this new intended production and all of its economic benefits to Decatur, our North American headquarters," Juan R. Luciano, CEO of ADM, said in a statement.
Shin Hak-cheol, vice chairman and CEO of LG Chem, said, "The establishment of this joint venture is a sustainable growth strategy that can directly contribute to solving environmental issues such as climate change and waste plastics."