Global agribusiness giant ADM has partnered with South Korean chemical company LG Chem to explore lactic acid production in the USA, World Grain reported on 15 September.
The companies signed a memorandum of understanding (MoU) for the project to meet growing demand for a range of plant-based products, including bioplastics, according to the report.
Following the agreement, the two companies planned to launch a joint venture early next year that would build, own and operate a US-based facility to produce high-purity corn-based lactic acid on a commercial scale, World Grain wrote.
“Today’s agreement is … another way in which we’re delivering on growth opportunities in plant-based solutions,” ADM chairman and CEO Juan Luciano was quoted as saying.
Once established, the joint venture would allow LG Chem to enter the bioplastics market by delivering a stable supply of raw materials, according to LG Chem vice chairman and CEO Hak Cheol Shin.
“As a part of our sustainable business strategy, LG Chem plans to accelerate the commercialisation of biodegradable resins that can contribute to solving environmental problems such as climate change and waste plastics,” Shin said.
In addition to its use in the production of PLA, the lactic acid produced by the proposed joint venture would be sold for use in a range of food and pharmaceutical applications, according to the report.
LG Chem and ADM have worked together previously and, in 2019, the companies signed a joint development agreement (JDA) to secure mass production technology to create bio-based acrylic acid, for use in the manufacture of superabsorbent polymers used in diapers and other hygiene products, World Grain wrote.
The companies would also collaborate on a second joint venture that would use lactic acid produced by the first joint project to produce and commercialise polylactic acid (PLA), a plant-based, biodegradable plastic that could be used in a range of products, from food packaging to clothing to upholstery.
The two companies had also agreed to actively cooperate in the joint development of technology for other biomaterials that could be applied in the biochemical and sustainability sector in the future, World Grain said.
Lactic acid, which is used in the food, feed and cosmetics industries as well as the industrial sector, was valued at approximately US$2.7bn last year, with an expected annual growth rate of 8%, according to Grand View Research.