Korea's LG Chem has announced a major green shift with its plan for a major investment in lactic acid and polylactic acid (PLA) resin. Teaming up with nutrition and biosolutions provider ADM, the two partners plan to take steps toward launching a joint venture in early 2022 that would build, own and operate a US-based facility to produce high-purity corn-based lactic acid on a commercial scale.
According to Grand View Research, global demand for lactic acid – which is used broadly in food, feed and cosmetics in addition to industrials like bioplastics – was valued at approximately US$2.7 billion in 2020, with an expected annual growth rate of 8 percent.
Further, the companies will collaborate on a second joint venture that would use lactic acid produced by the first joint venture to produce and commercialize polylactic acid (PLA), a plant-based, biodegradable plastic that can be used in a wide array of products, from food packaging to clothing to upholstery. According to new market research by MarketsandMarkets, demand for global bioplastics and biopolymers is projected to grow from US$10.7 billion in 2021 to US$29.7 billion by 2026, representing a CAGR of 22.7%.
ADM Chairman and CEO Juan Luciano and LG Chem Vice Chairman and CEO Hak Cheol Shin inking the deal at ADM’s global headquarters in Chicago. [Image; Businesswire]
The two companies also agreed to actively cooperate in the joint development of technology for other biomaterials that can be applied in the biochemical and sustainability sector in the future.
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