Materials shaping the future: Polymerised Lactic Acid (PLA)
Plastic is a relatively new material, and while most of us consider plastic to be of fossil fuel origins, the term defines a materiality that can be easily shaped or moulded, and there are many other forms of plastic. PLA is one. In a time of transition to a circular economy, the demand for sustainable strategy and investing is growing and expanding. Here, we share the company update from our PLA manufacturing partner, NatureWorks, who have attracted record financing to expand production of their PLA product Ingeo™.
Low recycling rates paired with endangering biodiversity and rising greenhouse gas emissions associated with petrochemical extraction, furthered by the negative effects of associated chemicals on human health, have resulted in globally, 731 new plastic pollution policies coming into effect (more will follow) between 2012 and 2022. The risks and costs associated with plastics continue to rise, and as such, currently, biodegradable polymers such as PLA, PHA, starch blends, and others are predicted to account for more than 55% of global bioplastic manufacturing capacity by 2029. Bioplastics are not seeking new markets; rather, they are replacing standard fossil-fuel plastics and their associated issues in the market.
This change in the production of biodegradable polymers is also related to a new mentality at the citizen level toward the circular economy and the EU plastics strategy, which was presented by the European Union in 2018, emphasising the approach of re-introducing more recycled plastics and non-fossil-based plastics. At present, bioplastics represent roughly 0.5% of the over 400 million tonnes of plastic produced annually, but the industry is rapidly growing. And PLA is leading this new wave of materials.
What is PLA?
PLA was discovered in the 1920s by Wallace Carothers, who also invented nylon. He had been working for DuPont in an attempt to find an “environmentally friendly” plastic. Plastic was cheaper to produce, and PLA never gained the mainstream popularism that fossil-fuel plastics did. This is a problem because Earth’s resources are finite, and we are striving for continued growth on a planet with boundaries. Fossil fuel extraction underpins this system and, with it plastic production.
Corn, cassava, sugar cane or beets are used to sequester carbon dioxide, which is transformed into glucose and then dextrose. Microorganisms ferment dextrose into lactic acid which is then transformed into lactide and polymerised—creating Polymerised Lactic Acid (PLA). Moisture and heat in commercial compost environments split the polymer chains apart, creating smaller polymers and, finally, lactic acid—the starting block. Microorganisms in compost and soil consume lactic acid as nutrients. The result (end product) of composting is carbon dioxide, water and humus, a soil nutrient.
Global bioplastics production capacity is set to increase significantly from around 2.18 million tonnes in 2023 to approximately 7.43 million tonnes in 2028. Source: European Bioplastics
NatureWorks' new PLA manufacturing facility
Developed by NatureWorks, Ingeo™️ PLA aims to accelerate a fossil-fuel plastic waste-free future. Late last year, the company announced that it had received historic financing from The Krungthai Bank (USD 350M) to optimise the capital structure for the new fully integrated Ingeo™️ PLA manufacturing facility in Thailand. In alignment with the banks’ ESG values and sustainable finance solutions, the investment demonstrates confidence in NatureWorks’ market leadership and global economic impact but also speaks to a more conservative approach taken by investors to de-risk. The decision also supports Thailand's ambitious Bio Circular Green (BCG) strategy.
Expected to open in 2025 with an annual capacity of 75,000 tonnes of Ingeo™️ biopolymer, this new facility will support rapid market growth across the Asia Pacific region for products such as compostable coffee capsules flexible and compostable food packaging. As pioneers driving the current system in a more sustainable direction, biopolymers produced at this new site will be made from sugarcane sourced from farms within a 50-kilometre radius of the Nakhon Sawan site. The area has a solid agricultural base that can provide an abundant, locally available sugarcane feedstock. And despite the lack of adequate legislation, standards, or commonly adopted criteria, NatureWorks continue to contribute to accelerating the needed shift away from petrochemical plastics.
The future
In a time of transition to a circular economy, the demand for sustainable strategies is growing and expanding. Non-fossil-fuel bioplastics are of paramount importance for sustainable innovation, and analysts forecast strong growth within the sector. Advances in technology have improved product quality and versatility while lowering production costs.
Rising fossil-fuel costs and progressive plastic legislation, in conjunction with reputational and legal risks, are the most prominent short-term risks investors should address with their investee companies are creating new opportunities for non-fossil fuel-based bioplastics. Disinvestment from fossil fuel plastics reduces the risk to business, from financial penalties on pollution and emissions to missed revenue opportunities from consumers looking for healthier, planet-positive alternatives.
As reported by Forbes investors are failing to adequately price the social and environmental externalities associated with the plastic value chain, according to new research published by Planet Tracker. Intensive materials research to develop processes of recirculating resources in loops of reuse, transformation and renewal to eliminate waste are needed. And as such, investment is required to transition to circular economies. The Krungthai Bank financing NatureWorks further demonstrates a commitment to this global shift towards a future where humanity and its products can coexist.
