Sustainable and eco-friendly bioplastics developer SECOS Group announced today that it will start manufacturing bioplastic resins in Malaysia.
The Melbourne-based manufacturer has entered into a two-year lease commitment, with an option for another two years, to manufacture at a new 30,000 square foot (2,800 square metre) facility located near Port Klang— Malaysia’s largest port, 38 kilometres southwest of Kuala Lampur.
The facility will house the company’s new resin compounding equipment and provide sufficient space for significant further expansion to meet ongoing growth in Asian demand for bioplastic resin.
Demand for compostable resin is at an all-high throughout the world, as major corporate brands pursue the benefit of customer acceptance and the boost to loyalty associated with environmental packaging.
Customers are increasingly demanding compostable resin and the price gap to traditional petroleum-based resins in continuing to tighten.
The global bio plastics market was US$19.54 billion (AU$25.44 billion) in 2016 and is estimated to reach US$65.58 billion (AU$85.38 billion) in 2022 at an estimated CAGR of 22.36 per cent for the forecasted period.
SECOS will initially commission two resin compounding machines which will provide sufficient capacity to rapidly address the company’s existing backlog of customer orders.
The company sees potential to increase production capacity at the new plant to 12,000 tonnes per annum of bioplastic resin over the medium term. At current market prices, SECOS is expecting the 12,000 tonnes of resin sales to generate approximately $40 million revenue per annum.
“We will be delighted to commence manufacturing resin in Malaysia within the next three months to help meet the strong demand the company is experiencing,” SECOS managing director, Stephen Walters said.
“This is our core product line, and SECOS’s establishment of a Malaysian resin manufacturing facility supports the company’s international growth strategy while leveraging the ‘green initiative’ set by the Malaysian government,” he added.
SECOS, headquartered in Melbourne with sales offices in Australia, Malaysia, China and USA, develops, manufactures and markets cast films and patented renewable resource-based materials and finished products derived from its proprietary technology for the global packaging and plastic products industries.