LG Chem US Builds Plant to Produce Polylactic Acid

On August 16, LG Chem signed a formal contract with ADM (Archer Daniels Midland) to build a "green bioplastic" factory in Illinois, USA. ADM is a nutrition company leading the market of food and beverage, nutrition, and sustainable solutions. It has a global agricultural supply chain and grain processing technology. It has been cooperating with LG Chem to develop plant-based biomaterials.

Contents of cooperation - the establishment of two joint ventures

The two parties will form two joint ventures to address demand for plant-based products and bioplastics. ——

The first joint venture, GreenWise Lactic, in which ADM is the majority shareholder, will utilize ADM's fermentation technology to produce 150,000 tons of corn-based high-purity lactic acid per year.

The second joint venture, LG Chem Illinois Biochem, will be majority-owned by LG Chem. It will leverage LG Chem's expertise in bioplastics to build a facility using GreenWise Lactic's products to produce approximately 75,000 tons of polylactic acid (PLA) per year. The bioplastic produced can make about 2.5 billion 500ml eco-friendly mineral water bottles. The production facility will be built in Decatur, Illinois, and is scheduled for completion in 2025. Construction will start in 2023 after final deliberations by both councils.

PLA market has broad prospects

LG Chem is the first Korean company to build a PLA plant from raw materials to product production. By establishing the joint venture, LG Chem can not only ensure high productivity of high-purity lactic acid required for commercial use of PLA, but also be able to apply biological raw materials to the development of various high-value-added products.

PLA is a representative biodegradable plastic made of lactic acid fermented from corn, which is harmless to the human body and is mainly used in food containers, straws, mineral water bottles, tableware, tea bags, etc. Under certain conditions, PLA is naturally degraded by microorganisms within a few months, and the greenhouse gas emissions during the production process are less than a quarter of that of traditional plastics. As a sustainable and environmentally friendly material, PLA has attracted much attention. The global demand for bioplastics is expected to grow from US$10.7 billion in 2021 to US$29.7 billion in 2026, with an average annual growth rate of 22.7%.