NatureWorks LLC Demonstrates Continued Renewable Resource-based Innovation
November 25 , 2005
Citing strong market, application and company growth, Kathleen M. Bader, chairman, president and CEO of NatureWorks LLC commented at a conference this week about the continued, rapid growth of renewable-resource-based products in Europe.
Bader credited strong European growth as a significant reason NatureWorks LLC nearly doubled its sales in the first half of 2005 versus the same period in 2004. Though the privately held company does not disclose sales figures, Bader said the trend is very encouraging, especially since 2004 had been a record year for the organization.
"Since 2000, when NatureWorks® PLA was introduced, the European market has been an early leader in adopting renewable-resource-based products," said Bader. "Heightened environmental awareness in European countries including Italy, France, Germany, Belgium and the U.K. have been key for bringing nature-based plastics into the mainstream."
NatureWorks produces and sells a renewable-resource-based resin derived entirely from the sugar found in common field maize. In the past year, the company has experienced successful market launches with leading retailers and brand owners including French retailer Auchan, U.K.-based water brand Belu and the Belgium retail grocery group Delhaize. Currently, more than 7,300 retail stores worldwide are selling products made from NatureWorks PLA.
NatureWorks PLA is also being used in new applications for renewable-resource-based materials such as specialty gift and retail cards, often replacing PVC.
Stable Supply
Another market driver in the supply chain is the stability of maize prices versus petroleum-based polymers such as PET. Based on manufacturing scale and process improvements, NatureWorks PLA has been price competitive for the past 12 months with PET. Given the recent sustained higher levels of PET pricing, however, NatureWorks PLA is now cost advantaged in some cases. This is encouraging many customers to seek multi-year contracts to ensure a more stable raw material supply and secure a predictable cost position for their own packaging materials.
Bader said that as products such as NatureWorks PLA continue to gain market share, it is incumbent upon market leaders to drive responsible innovation, as well as ongoing product and process improvements. This will help ensure meaningful and mainstream adoption of renewable-resource-based products.
"We have listened to our customers and they are very excited about our success and the ongoing potential of renewable-resource-based materials," said Bader. "Our customers, particularly in Europe, are embracing the positive change of switching from petroleum to an annually renewable raw material source. As a company, NatureWorks has an obligation to continue to improve, expand and support our products in ways that are most meaningful to the market."
Some of the enhanced product offerings now available from NatureWorks include improved recycling system integration, greenhouse-gas-neutral attributes and a source options program.
Recycling System Integration
NatureWorks PLA aids in landfill diversion by offering the widest array of end-of-life options of any plastic. The material is compatible with existing recycling systems, can be composted and incinerates cleanly. The company recently announced a "buy-back" program in North America to encourage recyclers and municipal facilities to separate and bale PLA bottles as they enter the mainstream consumer market.
The water and milk bottles made from NatureWorks PLA that are currently on store shelves can be sorted at a recycling or waste management facility using existing, standard equipment. The material can be collected in bales that will then be purchased at an agreed-upon price and disposed of properly. The buy-back program was created with the input and cooperation of recycling community stakeholders in North America. NatureWorks is working with European recyclers to explore implementing a similar program in select European countries, as appropriate.
World's First Greenhouse-Gas-Neutral Polymer
NatureWorks PLA will hold the distinction of being the world's first greenhouse-gas-neutral polymer. Our European customers have indicated that this may assist them to achieve compliance with the greenhouse-gas-emission reduction requirements of the Kyoto Protocol that went into effect in February 2005.
The greenhouse-gas-neutral distinction is the result of the combination of renewable-resource-based feedstocks, along with the purchase of renewable energy certificates (RECs) - all backed by peer- reviewed lifecycle assessment (LCA) data. These RECs will serve as an offset to cover all of the emissions from the energy used for the production of NatureWorks PLA - from the fuel farmers use in tractors to the final production of the polymer. The company will purchase certificates for projected 2006 production at its 300-million-pound (140,000 metric ton) capacity manufacturing plant and the world's largest lactic acid plant (400 million pound or 182,000 metric ton capacity) in Blair, Neb., U.S.A., as well as at its corporate offices in Minnetonka, Minn., U.S.A. The purchase of renewable energy will allow NatureWorks to decrease its fossil fuel footprint by 68 percent.
Source Options Program
NatureWorks LLC has also announced a source options program for customers who view maize variety as an important market issue. Under the three-tiered offering, customers may choose their desired level of market impact regarding the maize source of the polymer. Available programs include certification that the polymer has no genetic content, a source offset option (guarantees an equal amount of non-genetically modified maize is purchased and delivered) and a seed-to-finished product identity-preserved grade of NatureWorks PLA. By allowing customers to select the option that best fits their specific requirements, these new programs make it even easier for European retailers and brand owners to adopt NatureWorks PLA.
"Providing customer choice will help ensure our continued market growth and leadership in Europe," concluded Bader.
About NatureWorks LLC
NatureWorks LLC is a stand-alone company wholly owned by Cargill. Dedicated to meeting the world's needs today without compromising the earth's ability to meet the needs of tomorrow, NatureWorks LLC is the first company to offer a family of commercially available polymers derived from 100-percent annually renewable resources with cost and performance that compete with petroleum-based packaging materials and fibers. The company applies its unique technology to the processing of natural plant sugars to create a proprietary polylactide polymer, which is marketed under the NatureWorks® PLA and Ingeo® fibers brand names.
