Wednesday, June 13, 2012

Barriers to Lie on Road of Bio-degradable Plastics

More and more businessmen, politicians and citizens turn their sights on the bio-degradable plastics due to the shortness of fossil fuel and serious living condition. Also, domestic bio-materials have gained excellent score both in production capacity and technology. But will bio-degradable plastics have a smooth sail in the future? Maybe there are barriers lying on the road of bio-degradable plastics' development, according to CCM International’s June issue of Biomaterials China News.

High Price leads to small market
China has the largest population and now China's technology is close to that of western developed countries. However, China is still considered as a huge production base, but not a consumer market.

For the public, bio-degradable plastic sounds like a luxury. Take the food-grade film for example,PLA (polylactic acid) ,the most popular bio-degradable plastic, can be sold for USD4,740/t, while price of PE (polyethylene, one of the most general plastics) is only about USD1,896/t. Expensive price makes bio-degradable plastic invisible in general activity and daily life though it can attract many people's sight in large exhibition. Only some famous companies, like Coca-Cola and McDonald, who want to bear more social responsibility, have used bio-degradable plastic as their raw material.
Mr. Dan Sawyer, Manager of NatureWorks LLC in the Asia-Pacific region, said on April 19, 2012 that the quantity of consumed PLA worldwide increased by 20%, but regions responsible for the increase are Europe and America. In 2005, they entered into the Chinese market, and in 2011, their sale quantity is still about 4,000t, while the capacity of NatureWorks is 140,000t/a.
Domestic leading enterprises of bio-degradable plastics, such as Wuhan Huali, Guangdong Shangjiu, Kingfa, etc., complained about the similar problem, expressing that domestic bio-degradable plastic market is very small.

New Market is difficult to expand
Besides expensive cost, Mr. Hu, Chief Scientist of Wuhan Huali, explained that the difficulty to expand market has tormented bio-degradable plastic salesmen for a long time. He said that domestic companies have already formed a fixed network by purchasing and selling, while as a new product, bio-degradable plastic is still difficult to enter their network, for most enterprises are afraid to bear extra risk and don’t want to break down the cooperation with their traditional partners.
Attacks from low-end products and fake commodities
Attributed to government's weak regulation, many cheap fake commodities disturbed the market. When Wuhan Huali tried to expand market, they often have to face the situation exactly as what's said by Mr. Hu, "it just needs some recycled plastic and some calcium carbonate to produce fake commodities which are similar to ours, but these fake commodities can be sold at a very cheap price. If fake commodities can’t be banned effectively, the real environmental bio-degradable plastic industry will not have a bright futrue, which is dangerous (for the industry) at present.

R&D expenditure is insufficient
Innovation is the key factor for a company’s development, especially for those high technology industries, such as bio-degradable material. And private enterprises are an important source for innovation as they are sensitive to new technology and new market. But in China, most private enterprises’ R&D expenditure is insufficient. Mr. Bian, Senior Engineer of Shenghong Group, says that the R&D in China is just about how to make new technology applicable to industrial production, and one reason is that their R&D expenditure is limited by company’s budget, the other reason is that they dare not to start a long-term research since they are afraid of market changes. Mr. Hu, Chief Scientist of Wuhan Huali, who has been engaged in Chemical Department of Natural Science Foundation Committee, says that Chinese government should publish more policies to encourage colleges and research institutes conducting application and mass production research, as private companies are not able to apply for NSFC (Natural Science Foundation of China).
Raw material needs reformation
China has a huge population with relatively little land resources. Undoubtedly, Chinese government has to restrict food and grain application on non-food industries to guarantee domestic food supply. Nevertheless, corn and some grain crops which have abundant starch are still important raw materials of bio-degradable plastic, the problem may not have stood out yet. The total food-and-grain usage in this industry is not huge now. However, once bio-degradable plastics become main material in the future,  the problem can’t be ignored. Luckily, straw and other organic waste can replace grain crop as raw material. Corn deep processing industry can be a reference for the select of raw material, as corn deep processing industry consumed too much corn, which promotes corn price. At last, government published a serious of policies to squeeze their profit continuously.
Process technology is not mature
Through the development of several centuries, the process technology of fossil fuel plastics is very mature, and fossil fuel plastics can be widely used in almost all industries. But bio-degradable plastics still have many disadvantages, especially in process technology, which leads to bio-degradable plastics’ application focusing on package, medicals and disposable table ware.
Recycle and degradation may require a new system
In fact, most degradable plastics can’t decompose in nature environment. For example, PLA may exist 100 years or more without controlled-composting environment, which is made up of special facility, special microbe, and temperature of 60 celsius degree for more than 10 days. Besides, garbage workers can’t distinguish PLA from PET efficiently. A new system is required to recycle PLA, according to the dilemma on PLA’s recycle in America in 2009 that rubbish recycle station refused people to use PLA bottlers since PLA can bring great trouble for American Rubbish Recycling System that USA has spent 20 years on the system’s construction.

Though the bio-degradable plastic industry still has many problems to be solved, it’s still a great progress to decrease the rely on fossil fuel and strengthen environmental protection. The current situation is that more problems may be hidden, since the industry has just taken its first step. Nevertheless, the overseas market demand is greatly over its capacity, so the domestic market potential is predicted to be great in the future.

Source: Biomaterials China News 1206

Main content of Biomaterials China News 1206:
Barriers to lie on road of bio-degradable plastics
Numerous bio-material enterprises enter agriculture film market
Development of PLA recycle in China
 PBS may enjoy bright future in China
Kingfa tries to double its sales within four years
Domestic first low-temperature special water soluble fiber successfully developed
JAAS successfully developed degradable straw pot
Corn stock of northeast ports continues rising
Price of global wheat may be pushed to a higher record due to drought
… …
(Guangzhou China, June 12, 2012)

Biomaterials China News, with 12 to 14 topics in one issue, published on the 8th every month, will bring you the latest information on the latest market dynamics, company dynamics, new biomaterials products, new biomaterials technology development, new legislations and policies and raw material supply dynamics that are shaping the market.

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