This collaboration between South Korea-based LG Chem and US agribusiness company Archer Daniels Midland (ADM) on a potential production of lactic acid and polylactic acid (PLA) in the USA has been announced before, but this time, the press release that came out yesterday stated the location and capacity of this project.
The two companies held a signing ceremony for the launch of a joint venture that intends to produce 150 ktpa of lactic acid and 75 ktpa PLA to be located at ADM’s Decatur, Illinois site in the USA. The final investment decision and targeted construction will be made next year. Production is expected to start in late 2025 or early 2026. ADM would be the majority owner of this first joint venture called GreenWise Lactic, which would contribute fermentation capacity from its Decatur bioproducts facility to the JV. The second JV, LG Chem Illinois Biochem, would be majority-owned by LG Chem, which would build upon the company’s expertise in bioplastics to build a facility that will use the lactic acid feedstock produced by GreenWise Lactic.
The press release reported the value of global lactic acid demand last year at $2.9bn, with an expected annual growth rate of 8%. Global demand for bioplastics and biopolymers, meanwhile, is reportedly projected to grow from $10.7bn in 2021 to $29.2bn by 2025, representing an annual growth rate of 22.7%.
Both ventures are reportedly participating in the State of Illinois’ Economic Development for a Growing Economy (EDGE) program, which provides incentives to job creators who plan to make investments in Illinois.
As always, I will do my lactic acid and PLA markets analysis for next month’s Bio-Materials report at Tecnon OrbiChem. NatureWorks is currently the only commercial PLA producer in the USA with a capacity of 150 ktpa located in Blair, Nebraska. NatureWorks is jointly owned by Thailand’s integrated petrochemical and refining company, PTT Global Chemical, and US agribusiness company Cargill.
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