Global agribusiness giant ADM and chemical company LG Chem have announced that they will not be moving forward with their joint venture project to produce lactic and polylactic acid.
The two joint ventures include GreenWise Lactic, of which ADM is a majority owner, and LG Chem Illinois Biochem, which is majority-owned by LG Chem.
Polylactic acid, also known as PLA, is a thermoplastic monomer derived from renewable, organic sources such as corn starch or sugar cane. Using biomass resources makes PLA production different from most plastics, which are produced using fossil fuels through the distillation and polymerisation of petroleum.
“Since we originally announced our two joint ventures with LG Chem for lactic and polylactic acid in 2022, construction costs have skyrocketed,” Chris Cuddy, president of ADM’s Carbohydrate Solutions business, said on 12 July.
“We looked at a variety of options, but when the time came to make final investment decisions, it had become clear that these projects no longer represented a prudent use of our investors’ capital that would meet our returns objectives.”
When first announcing the project in 2022, the companies said the plan was to build the production facilities in Decatur, Illinois, USA, with production expected to begin in late 2025 or early 2026.
ADM said it would continue to expand its biosolutions portfolio to meet growing demand for sustainably sourced solutions.
LG Chem is a leading global chemical company and is active in the petrochemicals, advanced materials, and life sciences sectors. The company manufactures a wide range of products from high value-added petrochemicals to renewable plastics, specialising in electronic and battery materials, as well as drugs and vaccines.
