SKC Establishes Eco-Friendly Biodegradable New Material Joint Venture with Daesang and LX International

2023 Annual Production Target of 70,000 Tons
Aiming to Become a Global Major Company in the Eco-Friendly Materials Market

[Asia Economy Reporter Hwang Yoon-joo] SKC is set to accelerate its eco-friendly new material high-strength PBAT (Polybutylene Adipate Terephthalate) business in collaboration with Daesang and LX International. Through this investment, the company plans to expand its eco-friendly materials business centered on high-strength PBAT.

On the 23rd, SKC held a board meeting and decided to invest a total of 104 billion KRW, including a technology valuation of 79 billion KRW, in the joint venture established with Daesang and LX International. Daesang will invest 40 billion KRW, and LX International will contribute 36 billion KRW.

The joint venture aims to commercialize in 2023 by establishing a production facility in Korea with an annual capacity of 70,000 tons. Once commercialization begins, the joint venture will become the world's second-largest major PBAT manufacturer.

The three companies will join forces to expand the base of biodegradable plastics to address plastic issues. SKC will provide mass production technology for high-strength PBAT, operational know-how, and R&D capabilities. Daesang will enhance eco-friendliness by supplying key PBAT raw materials (BDO·Butanediol) derived from biomass in the future, and LX International will support product distribution based on its overseas marketing capabilities and global network.

The biodegradable materials market is rapidly growing due to strengthened regulations on single-use plastics centered in Europe and the spread of plastic waste issues. According to an analysis by a market research firm, the global PBAT market, which was about 250,000 tons last year, is expected to grow to approximately 500,000 tons by 2025. In particular, the market is rapidly expanding as China and the United States have recently begun to phase out single-use plastics. Accordingly, SKC expects the potential demand to exceed 2 million tons.

High-strength PBAT, which improves the drawbacks of conventional PBAT, has even greater growth potential. While conventional PBAT decomposes 100% underground within a short period, it is easily torn, limiting its application expansion. High-strength PBAT uses nanocellulose extracted from wood as a reinforcing agent, giving it strength comparable to general plastics. Therefore, it is highly anticipated by customers as a substitute material for hard-to-decompose single-use plastics such as straws, plastic bags, and agricultural mulching films. SKC is currently conducting tests and discussions for commercial application with more than 20 customers.

This content was produced with the assistance of AI translation services.