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Bioplastics Supply Chains – Implications and opportunities for agriculture by Wondu Holdings
November 2004
RIRDC Project No: WHP-5A RIRDC Publication No:04/044
While there are some forecasts for a reversal in this 30-year relative price trend the continuation of subsidies for agricultural production is likely to sustain further declines in the relative price of agricultural materials to crude oil.
While there are reasonable expectations for improvements in processing technologies these improvements are probably going to be spread evenly across the broad spectrum of all materials, perhaps with a neutral effect on relative prices. Possible exceptions to this exist in respect of gene technology enabling the production of polyesters directly in plants.
The relative prices of oil, close oil substitutes and agricultural materials are also likely to be disturbed by growing use of government regulations to ensure externalities, such as greenhouse gas emissions and relative energy use, are fully reflected in prices. For there to be an improvement in price efficiency, however, from the incorporation of externalities in prices, there would need to be better measurement and understanding of the true ‘cradle-to-grave’ effects of different production systems.
Life Cycle Assessments (LCAs) favour those plant and animal materials that are produced in low cost, unsubsidized agricultural production systems. For this reason, countries like Australia would seem to have an interest in conducting thorough LCAs on a series of bioplastic products made from locally grown crop and animal products. There would be nothing more inefficient than developing a bioplastics industry on materials that were actually worse for the environment and less energy efficient than the current fossil fuel based plastics supply chains.
A bioplastics industry has
potential to have impact at the farm enterprise level by increasing competition
for agricultural materials at the farm gate. This could be achieved in
one or more ways:
To take the next
step forward this study proposes a number of detailed tactical and broader
strategic recommendations. Key strategic recommendations are:
CASE STUDY 1: CLEANING
UP AT THE SYDNEY OLYMPIC GAMES
A less conspicuous feature
of the 2000 Olympic Games in Sydney was the presence of biodegradable and
compostable garbage bags, utensils, cups, straws and trays. The products
were supplied via Biocorp USA, an associate at the time of Italian based
Novamont S.p.A, which has developed a range of biodegradable thermoplastic
starch materials and technologies for making various bioplastics. The products
were distributed through Cleanevent cleaning management services and Visy
packaging and recycling services, who had the task of servicing over 10,000
athletes, 5,000 support staff and several million spectators. The estimated
waste discharge was 10,000 tonnes.
Novamont’s lead product line is Mater-Bi, a thermoplastic starch, derived largely from maize, wheat or potatoes, which are the three main sources of starch in the world. Mater-Bi is now distributed directly in Australia through Plastral Fidene.
Novamont claims Mater-B based materials have biodegradation rates similar to cellulose, mechanical properties equivalent to polyethylene (PE) and polystyrene (PS) and reduced sensitivity to humidity, making them suitable for injection moulded items and foam plastic products, as well as having potential for use in tyres.
Mater-Bi material is currently used to make films for composting bags, industrial packaging (e.g.
shopping bags), sanitary products (nappy backsheets), mulch film and food packaging. Mulch film and food packaging are seen as the markets with the highest growth potential.
In Australia, PE (excluding High Density PE) and PS account for about 22% of the 1.5m tonne resin market A similar share exists in other developed economies. Products like Mater-Bi (as well as other similar products including biodegradable PE) would seem to have most potential to capture share in these markets, though cost and functional suitability of materials will obviously be major drivers of demand.
There is growing interest in the environmental performance of plastic products, including their destination and value in waste management systems, as well as their levels of greenhouse gas emissions and energy efficiency. Local government authorities throughout the world are showing increasing interest in charging differential taxes on waste in favour of products that have a positive impact on the environment. This has potential to act as a stimulus for biodegradable plastics that meet the standards set for biodegradability, compostability and other recycling measures that may be in place.
 
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