TAGS: Sustainability / Natural Solutions
LG Chem announces that it has signed a Heads of Agreement (HOA) for the establishment of a Lactic Acid (LA) and Poly Lactic Acid (PLA) joint venture at the ADM headquarters in Chicago, Illinois, in the presence of executives from both companies, including ADM CEO Juan Luciano and Hak Cheol Shin, CEO of LG Chem.
The two companies will sign the definitive agreement in the first quarter of next year and plan to complete construction of the PLA production plant with an annual capacity of 75,000 tons and LA production plant for this purpose in the U.S. by 2025. LG Chem to build a PLA plant in the US with integrated production from raw materials to end products.
Maintaining Stable Supply of Raw Materials
The establishment of the joint venture will allow LG Chem to integrate renewable biomaterials into the development of its various high-added-value products based on vertical integration and secure the production capacity for high purity lactic acid at a commercial scale, thereby securing a stable supply of raw materials necessary for PLA production.
LG Chem plans to
penetrate the bioplastic market based on its PLA production capacity. It plans to accelerate the commercialization of its biodegradable plastic as a potential contribution to the response to climate change and the resolution of environmental issues such as plastic waste as part of its sustainability strategy.
Through this agreement, the two companies also agreed to actively cooperate in the joint research and development of biomaterials that can be applied in the eco-friendly and sustainability sector in the future.
Transition to Sustainable Business Structure
ADM Juan Luciano remarked, “
Our cooperation with LG Chem will create a new opportunity for growth in solutions based on bio-based materials and the enhancement of value for our customers.”
Meanwhile, LG Chem CEO Hak Cheol Shin stated, “
The establishment of a joint venture with AMD will be the start of a new journey that goes beyond simple cooperation to lead the transition to a sustainable business structure for the benefit of the environment and society.”
Shin also added, “
We will continue to actively seek out new ways to contribute to carbon neutral growth as a leader for sustainability.”
Source: LG Chem