The biodegradable plastic track is rising, which companies have been "ambushed" in advance?

Governing global plastic pollution is one of the most important topics at the recently held United Nations Environment Assembly, which focuses on global plastic pollution and the formulation of the first global agreement to address the plastic crisis

Under the background of environmental protection, carbon neutrality, and carbon peak rising to the global theme, plastic pollution has once again become a focus issue.

Biodegradable plastic track 100 billion market can be expected

White pollution has become a thorny problem in today's society.

Driven by the ban on plastics, degradable plastics have become the best alternative

At present, the market share of fossil-derived plastics is as high as 75%, while biodegradable plastics only account for 1%, and the penetration rate still has a lot of room for improvement

In this rising 100 billion high-quality emerging track, more than 30 companies have biodegradable plastic projects under construction or planned, and the planned new production capacity exceeds 10 million tons.

Along the different raw material routes of degradable plastics, the advantages of each domestic enterprise are also different

In the field of PLA new bio-based materials, the largest domestic producers are Anhui Fengyuan Biology, Henan Longdu Tianren, Jiangsu Yunyoucheng Biology, Zhejiang Hisun, and COFCO Technology

On the PBAT petroleum-based biodegradable membrane route, Lanshan Tunhe, Kingfa Technology and Zhuhai Wantong are the largest producers

PLA has become an urgent area to be conquered

Among the many categories of degradable plastics, PLA and PBAT have relatively mature production technology and high degree of industrialization, occupying the mainstream of market development

PLA is derived from viable plant resources such as corn and wheat.

The production capacity of PLA is mainly concentrated overseas.

In recent years, domestic companies have also accelerated their deployment.

Jindan Technology located in eastern Henan is a high-tech enterprise mainly engaged in the research and development, production and sales of lactic acid and its series of products.

In the field of biodegradable materials, the company already has production technologies such as lactide, and has built a high technical barrier

In order to meet market demand, the company has planned a 100,000-ton polylactic acid project, which is planned to start construction in the second half of 2021, with an estimated construction period of 18-24 months

COFCO Technology Co.
, Ltd.
, a biotechnology company mainly engaged in corn intensive processing, is also actively deploying in the PLA field
.
At present, the company has mastered a series of production technologies of starch, starch sugar, lactic acid, lactide and polylactic acid, and has successfully realized the industrial application of PLA
.

COFCO Biomaterials (Elm) Co.
, Ltd.
was established in December 2021 with a registered capital of 150 million yuan
.
The establishment of the new company will accelerate the construction of the project with an annual output of 30,000 tons of lactide
.
According to the latest research, the core work of the project this year is the selection, bidding, equipment customization and procurement of the core equipment of the production line
.
Because lactide products have relatively high requirements on the control of the reaction process and the handling of extreme working conditions, the core equipment must be imported from abroad
.

In addition, the company is also exploring the production process of PHA, a natural polymer-based material synthesized by microorganisms, and is currently investing in the construction of a 1,000-ton PHA project in Jilin
.

The situation faced by PHA and PLA is similar.
Limited by the technical threshold, the total production capacity of PHA in the world is only tens of thousands of tons, which is expensive.
The main application scenarios are still concentrated in medical or high value-added fields
.

Overall, China's PLA industry is still in its infancy.
There are not many production lines that have been built and put into operation, and most of them are small in scale
.
A major limitation of this reason is that the intermediate lactide used in the preparation of PLA has long relied on imports, resulting in the domestic production of polylactic acid falling short of demand and relying on imports for a long time
.

The growth rate of the sector's performance is dazzling

In 2021, driven by policies and demand, the performance of the degradable plastics industry will generally perform well, and individual companies may even increase their profits by more than ten times
.

Specifically, according to Wind data, 24 of the 27 companies in the degradable plastics sector achieved positive year-on-year revenue growth in the first three quarters of 2021.
Only Aoyuan Meigu (000615.
SZ) and Dawn Co.
, Ltd.
(002838.
SZ) and Yifan Pharmaceutical (002019.
SZ) saw a year-on-year decline in revenue
.

The companies with outstanding operating income growth are Wanhua Chemical (600309.
SH), Meirui New Materials (300848.
SZ), Ruifeng Advanced Materials (300243.
SZ), Sinochem International (600500.
SH), Changhong High-tech (605008.
SH) and so on
.

The growth rate of net profit attributable to the parent is more dazzling, namely Sinochem International, Aoyuan Meigu, Wanhua Chemical, Yuxin Shares (002986.
SZ), COFCO Technology, Junzheng Group (601216.
SH), Ruifeng High material,
etc.

The growth rate of the industry sector is dazzling, and degradable plastics also usher in new development opportunities
.
With the "14th Five-Year Plan for Circular Economy Development", the special action to control the whole chain of plastic pollution has been carried out in sequence, and the national standard of "Biodegradable Plastics and Products Degradation Performance and Labeling Requirements" will be officially launched on June 1, 2022.
The implementation is expected to open up incremental space for industry enterprises again
.