tappi flexible packaging 2009...• today’s population 6.7 billion; 50% in just 6 countries •...

TAPPI Flexible Packaging Summit 2009Columbus, OH

28 April 09

Plantic Technologies ‐Who We Are

PLANTIC TECHNOLOGIESChanging the nature of plastics

Discussion Points


Who We Are:Australian based company with a single‐minded commitment to provide bio‐responsible materials solutions for the world market that deliver all the functionality of conventional petrochemically derived plastics in an economical and eco‐sensitive way

Why Are We Here:Increasing demand and consumption of shrinking natural resources along with tightening legislation and corporate transparency is driving the demand for responsible solutions to today’s packaging challenges ‐MARKET DRIVERS!!!

What Can We Do:Plantic technology provides a unique set of attributes resulting in a renewably sourced functional packaging material with one of the broadest end‐of‐life schemes in today’s market BIOPOLYMER SPACE…

In Closing:How are others navigating the sustainable waters, what works and what doesn’t –where is Plantic’s place in the world of flexible, sustainable packaging. WHERE TO GO FROM HERE…

Who We Are

Plantic:Australian based company with a single‐minded commitment to provide bio‐responsible materials solutions for the world market that deliver all the functionality of conventional petrochemically derived plastics in an economical and eco‐sensitive way.

• Australian Co‐operative Research Center for Food Manufacture & Packaging Science

• 7 Years + A$18 million to develop corn starch‐based packaging technology

• Commercialization of first product in October 2003

Boston, USA

Melbourne, AU

UK

Germany

Our Partner(s)

Press Release - MELBOURNE, Australia and WILMINGTON, Del., USA, Sept. 26, 2007

DuPont and Plantic Announce Starch-Based Biomaterials Alliance

Partnership to Focus on Materials for Food and Other Packaging Uses

DuPont will distribute and market the Plantic® Thermoplastic Starch offerings in the markets noted:• Thermoformable Sheet in North America , Latin America and Japan (MDP)

• Injection Molding resin grades Globally

• Future Grades Globally

Products are branded under the DuPont™ Biomax® TPS name

• Today’s Population

6.7 billion; 50% in just 6 countries

• 2050 Population

9.3 billion

50% in China & India

Middle class growth

• China 15X

• India 14X

• Russia & Brazil 2X

• Industrialized countries see little population change

Population Growth

“Given existing technology and products, for all 6 billion people to live like the average American would require 3 earths to provide the material, energy and waste disposal.”

‐ Chad Haliday former Chairman/CEO DuPont

• Impacts of Population Growth• World oil demand grows 50% by 2025

• China adding one coal fired power plant per week for the next 7 years

• The United States, Europe, Japan, India and China together claim 75% of the earth’s “biocapacity”

• Population and economic growth have outpaced improvements to the environment over the past few decades

Impacts of Population Growth

Without business and government interaction, we are poised for an expensive and dirty future

• Peak Oil Production

– “Hubbert’s Peak”predicts a peak in global oil capacity in 2010

– MiddleEast production per well head is down is down 65% from 1980 levels

– Oil price fluctuations place a critical burden on commodity packaging materials

Depleting Resources

2008 pricing for LDPE film grade resin increased by 45% from a low of $0.79/lb to a high of $1.15/lb

• CO2 Concentration• 600,000 years with CO2

concentration never > 300ppm

• Current CO2 levels at 385ppm and rising

• U.S. levels projected to increase 35% from 2005 to 2030

• Within a decade, developing countries will account for 2/3rds of GHG emissions

CO2 Concentration

Generally accepted cause: Industrial burning of fossil fuels

• Sea Ice concentrations rapidly declining

• Rate of decrease greatest during the 21st century

• 20 years ago covered 50% ‐ 60% of the Arctic Ocean, only 30% in 2008

Rising Temperatures

GHG emissions play a significant role in raising the planet’s temperature – Global Warming

The Six Sins of Greenwashing

Sin of the Hidden Trade Off:Suggests a product is “green” based on a single environmental attribute, such as the recycled content, without paying attention to other important criteria such as energy consumption – such claims are used to point to a “greener” picture of the product

Sin of No Proof:Any environmental claim that cannot be substantiated by easily accessible supporting information or by a reliable third‐party certification , such as post‐consumer content

Sin of Vagueness:Any environmental claim that is so poorly defined or broad that its’ real meaning is likely to be misinterpreted

Sin or Irrelevance:Any environmental claim that can be truthful but is unimportant or irrelevant and is distracting consumers away from truly “greener” products

Sin of Fibbing:Making environmental claims that are simply not true

Sin of The Lesser of 2 Evils:Any environmental claim that may be true within the product category, buy may distract the consumer from the greater environmental impact of the category as a whole

“Consumers transfer sensations or impressions they have about the packaging of the product to the product itself.”

‐ Louis Cheskin

Why Are We Here

Kyoto: Ratified by 175 countries

Clinton Global Initiative: Voluntary commitments to TBL

Courtlands Commitment: Major UK retailers agree to reduce packaging waste

Growth of global carbon emissions has not slowed ‐ growth in China is overtaking any gains

France: Most supermarkets sign on to promote “environmentally friendly” goods; reduce packaging waste by 10% and increase glass, paper recycling rates to 75%

Pledges country will be carbon neutral: Norway

EU also considering a carbon tax on imports from countries that do not adhere to Kyoto

Dell: Pledges all operations & transportation will be carbon neutralUK Wrap: Proposes variable VAT to boost recycled plastics market

Holland: Sets carbon based packaging tax based on estimated CO2 emissions

2004 2005 20502008 20302025202020152014201220112010

SC Johnson: 12% GHG reduction across all factories across globeNike: to be carbon neutral Marks & Spencer: carbon‐neutral and send zero waste to landfills

To shut down all remaining coal fired electricity plants: Ontario

Reduce GHG by 15% from 2004 levels :DuPontTo send zero food and packaging waste to landfill :UK

To be zero waste :Wal‐Mart

US GHG 19% reduction from 2005: Climate Security ActTo reduce GHG by 20%; most Canadian provinces have targets of 33‐50%: Canada

50% absolute reduction in net carbon emissions: Cadbury Schweppes

75‐80% reduction – 2050: Western Climate InitiativeJapan proposes 50% global emission reduction: G8 Summit

Lack of harmonization will likely lead to many and varied initiatives

To reduce GHG emissions by 20%: EUUK Food and Drink Federation

Members to reduce packaging by 13% vs... 2005; reduce CO2 emissions by 20% from 1990

The Business of Sustainability

"Ethical reputation has overtaken quality as the leading component of a successful brand”

• Triple Bottom Line (TBL) has become the business norm

• Shareholder and NGO demands for transparency are increasing

• Human rights and environmental concerns/risks are now part of determining market value

• Businesses can be exposed through suppliers (2) and (3) tiers back in the supply chain and face risks they don’t realize

• 75% of CEO’s believe corporate reputation is more important today than even (2) years ago, and over 80% of companies express significant concern about its damage

“Based on our scenario of more stringent climate change regulations, enhanced and enforceable forest policies, growing water scarcity in key agricultural regions, informed biofuel policies, and a greater consumer demand for green products, we estimated a reduction of 13 to 31 percent in earnings before interest and taxes (EBIT) by 2013 and 19 to 47 percent in 2018 for FMCG companies that do not develop strategies to mitigate the risks posed by environmental pressures.”

‐ Rattling the Supply Chain

Now is the Time

Hedging strategies or changing suppliers will not be enough

• “Packaging is Bad”• 2007 Nielsen survey in 48 nations

• 40% of respondents were “very concerned” by trash from food packaging

• Concern for packaging waste increased more than any other environmental concern

• Types of comments most often heard• Wasteful, inefficient, unnecessary

• Most packaging is bad simply due to the fact that it’s not needed

What are Consumers Saying

Packaging is perceived as a significant environmental concern

• Consumers want it all!• Sustainable price, product, package,

accessibility, value, convenience; the total value equation

• Purchasing decisions are lifestyle choices• US lifestyles are not sustainable

• Throw and go

• US lifestyles require easy solutions; the more you ask a consumer to do the less participation you’ll get• Understanding the different green terms

• Composting only a subgroup of materials

• Recycling

What are They Doing

Sustainability and sustainable packaging have a broad range of definitions

“Consumers are becoming increasingly concerned about the contents and origins of the goods they buy, and the amount of packaging that comes with these goods. They want to know about a number of possible issues such as ingredients, country of origin, usage and best disposal option.”

What are We Hearing

• The Great Pacific Garbage Patch• In the middle of the north pacific gyre is a garbage patch the size of Texas

• The water is filled with 6 times as much plastic as plankton

• Plastic is believed to constitute 90% of all rubbish floating in the oceans

• In 2006, every square mile of ocean contained 46,000 pieces of floating plastic

Now is the Time

VIDEO: http://www.youtube.com/watch?v=tnUjTHB1lvM

• Broadly patented technology developed in Australia for high amylose TPS

• Totally organic and completely biodegradable alternative to petrochemical plastics

• Cost effective and bio‐responsible material technology with a proven track record

Plantic TPS

Thermoplastic Starch (Plantic®) – 90% by dry weight High Amylose Starch

Starch Polymer blends (Cereplast, Novamont & Stanelco) – blends of PLA or Polyesters with commodity starches

PLA (NatureWorks) – A biopolymer derived from corn rather than petrochemical feed‐stocks; uses fermentation

PHA (Tianan, Telles) – produced in bacteria through fermentation processes using corn feedstocks

Cellulose (Innovia) – Cellulose based films from Pulp feed stock

Synthetics (BASF, Showa) – Polyester resin derived from petrochemical feed‐stocks

PE/pro‐oxidant blends (Symphony Plastics) ‐ the pro‐oxidants make the PE polymer chain breakdown into small particles – does not bio‐degrade the polymer

Biopolymer Differentiation

• Today• Handful of polymer types

• Cellulosic's, Starch, PLA

• All finding niche applications primarily for limited service life and other applications that benefit from an end of life involving biodegradation to CO2 and H2O

• Price typically higher than incumbents

Renewably Sourced Polymers


• 2018• Basically the same base of

polymers

• Starch, Proteins, Cellulose, PHA’s

• Applications expanded due to continued modification s to extend properties

• Price is still higher, yet economies of scale are closing the gap

Today’s renewably sourced polymers will become more functional

Today’s Biopolymers


• Cellulosic's• Cellophane (Innovia)

• Natureflex (Cellophane w/ biodegradable seal layers, Innovia)

• Cellidor (Cellulose Acetate Butyrate, Albis Plastics)

• Xelox‐L (Cellulose Acetate, Cellulose Propionate, Mazzuccheli)

• Starches• Plantic Technologies/DuPont

Biomax® TPS (sheet, IM resins)

• Mater‐Bi (Novamont) starch blends

• Biograde TPS (Biograde, Ltd)

• Biopar starch blends (BIOP Biopolymer Technologies)

• Solanyl BP starch and protein mixture (Rodenburg Biopolymers)

• Stanelco Biotec TPS

• Cereplast starch blends

• Polylactic Acid (PLA)• Natureworks, Biofront (scPLA)

• Polyhydroxyalkanoates (PHA)• Mirel (polyhydroxybutyrate, PHB)

• Biomer (polyhydroxybutyrate, PHB)

• Biocycle (poly(3‐hydroxybutyric acid, PHB)

• Tianan Biologic (hycroxybuyratecovalerate, PHBV)

• Starch is a carbohydrate stored within plants as an energy reserve for times of dormancy, germination and growth

• Found in a variety of plants including maize, potato, rice, wheat and tapioca

•High amylose starch produced from non‐GM hybridized corn

TPS – Where Does It Come From

Plantic amylose (thermoplastic starch) is created by nature and returns to nature

• Inexpensive bio‐plastics option

• Delivers similar functional performance as incumbent

• Renewable vs non‐renewable content, non‐sequestered carbon

• “Green” alternative allows market differentiation and environmental goals to be achieved

• Will not contaminate the recycle stream

• Home compostable‐ gone in a matter of weeks

• “Dispostable

TPS – Value Proposition

• Development agreements with Bemis & Amcor

• Flushable

• Waster Dispersible

• Biodegradable in Water

Plantic Films – Flexible Packaging

Water dispersible films for packaging…

• Key Requirements• Excellent gas barrier performance

• High resolution printing

• Effective in‐mold decoration

• Efficient performance in established recovery systems

Barrier Property Space

Barrier closures with in‐mold labeling

TPS – Features & BenefitsPlantic® / DuPont™ offers a thermoformable sheet option that :

• Uses Renewable resources, GM‐free (85% ‐90% RS)

• Biodegradable & Compostable (Home, Water, Soil, Industrial)

• Water dispersible, flushable & biodegradable in water

• Suitable for thermoforming applications for:• Foods with .35 to .70 water activity• Greasy/fatty foods• No water activity – no contact with

water/moisture• Food contact approved (US pending, EU

approved)• Strong flavour and odour barrier• Inherently anti‐static and oil resistant• Sealable, printable and laser etch able

For Brand Owners and/or Retailers

Performance and value

Demand for renewable materials –sustainability

Reduce waste – composting

Product differentiation and innovation

Extended shelf life and functional packaging

Converts on industry standard equipment

Supports Brand and Corporate values around Sustainability

• A key non‐tariff barrier, JORA certified• Increasing pressure to reduce the impact of

waste on the environment• Based on performance in the waste stream• Plantic® is the thickest certified material on

the market for home compost• Exemption to the Green Dot in Germany

decrease price pressure• Certified to the same level now in the US

TPS – End of Life Options

“Extended‐producer responsibility (EPR), where a manufacturer remains responsible for its product throughout the product's entire lifecycle, is also gaining support.” ‐ Converting Magazine Mar 09’

End of Life ‐ Recycling


• Today• Handful of materials – rates poor for

plastics (U.S. Data)• Paper >50%, Metals ~50%

• Plastic ~ 25% for PET, HDPE

• Higher rates for in process recycling

• Limited recycling via unzipping and repolymerization

• Sorting• Density via float/sink cyclones

• Spectroscopic: IR, X‐Ray fluorescence

• Emerging infrastructure & technology

• Companies investing in collecting, sorting, cleaning infrastructure

• Post consumer recycle content typically less than 50% except for paper and metals

• 2018• Higher percent recycling and recycled

content for those plastics where recycling makes the most sense vs. compostable and waste to energy alternatives

• Infrastructure established

• Sensing and sorting systems established

• Clearer understanding by consumers of what recycling means for these materials

• Meaningful icons and mobile enabled links to information

• Economic attractiveness for those material where recycle is the recommended end of life option

End of life option chosen to minimize waste footprint

End of Life ‐ Composting


• Today• Small percentage of packaging

materials are sent to composting• Compostable starch‐based liner bags for

food scraps, other recognized compostables

• Waxed paperboard from supermarkets

• Compostable materials are typically• Natural polymers

• Hydrolysable polymers

• Partial microbial degradation to persistent, non‐degrade fragments recognized as an issue

• Mainly yard waste facilities in U.S.

• More mixed use facilities in EU

• 2018• Technologies for compostable

materials matched to where that end of life option makes the most sense

• Disposalware, film wraps and bags for high volume, high visible waste disposables, molded containers for articles that could easily be mingled with food waste and/or are not suited for recycling or in a closed loop environment (e.g. Disney)

• Clearer understanding by consumers of what composting means for these materials


• Economic attractiveness for those materials where composing is recommended

Composting will occur where it makes sense via the right infrastructure

End of Life – Waste to Energy


• Today• Emerging examples of landfill gas

usage• Steam, Methane (S.C. Johnson)

• Global examples of incineration to energy

• EU, Japan – fewer in N.A.

• Emerging examples of waste to biodiesel

• Waste plastics typically have high BTU value

• Economics dependent on high enough volumes to offset capital and other costs

• Today• Waste to energy technology matched

to where it makes the most sense for end of life

• High BTU materials

• Lack of toxic release concerns

• Clearer understanding by consumers of what waste to energy conversion means for these materials


• Economic attractiveness for those materials where waste o energy is the recommended end of life option

Waste to energy willl be the sensible EOL for waste which is not easily recycled or composted

Retailer Response

It’s called Plan A because there is no Plan B!‐ Stuart Rose, CEO M&S

• Plan A is broken into 5 segments including:• Waste• Health• Fair Partner• Climate Change• Sustainable Raw Materials

• Goals for 2012• Become carbon neutral• Send no waste to landfill• Extend sustainable sourcing• Set new standards for ethical

trading

Sustainability – The Journey

In Jan. 2007, Marks and Spencer (M&S), a UK based retailer, launched Plan A, a 100 point commitment to reduce the company’s environmental footprint.

• Packaging specific goals include:• Reduce non‐glass packaging by

25% , and showing preference to easily recycled or compostable packaging

• Cut carrier bags used by 33%, and use bags made from recycled materials

• Trial more closed loop recycling within store cafeterias

• Mark “air‐freight” label on products shipped via air to highlightt carbon footprint of air‐freight

• M&S has reduced their carbon footprint by 28% from 06’ to 07’

Sustainability Messaging

• Consumer Awareness and Renewably Sourced• GM free• Home compostable• Reduction in GHG emissions• Alignment with corporate values• 2007 DuPont Packaging Innovation Award

Renewables –Implementation

“We hope our use of Plantic packaging demonstrates that we care how we do business, and about our customers environmental concerns.”

‐ M&S

• Raw material prices are seen as the biggest challenge

• Almost 40% of respondents mention better, new materials as the most needed development

• FTC requiring a time stamp to avoid green washing

• Over 75% of respondents say there should be minimum standards set before packagers can market themselves as “green”

Challenges

Emphasis on improving energy efficiency needed to drive fossil fuel reductions

• More companies implementing sustainable packaging policies in 2008• 62% had either formal or informal policies or policies under

development compared to 50% in 2007

• Customer requirements are still the most influential factor driving sustainability activities

• 75% of organizations tie sustainability initiatives to other programs such as Lean Manufacturing

Sustainable Program Integration

Most organizations requiring an ROI on sustainable activities within 1 to 2 years

• Branding Sustainability and Responsibility• First, understand environmental impacts and dependencies by

examining how cost drivers are exposed to emerging environmentaltrends and, when possible, seek substitutes

• Take inventory of current environmental initiatives through the value chain to see what the company, its suppliers and partners are already doing

• Rank environmental issues and opportunities according to their current and future potential impact on costs, revenues and reputation

• Chart a new course by imbedding sustainability into an action plan, by including externalities in the decision‐making process and establishing the principal performance indicators

Wrap Up

In Closing…• Businesses face unprecedented social, economic and environmental risks and

opportunities in the coming decade

• Sustainability doesn’t simply require doing things differently, it requires a radically new mind set – need to go beyond incremental projects and programs

• Transparency is expected and NGO’s are playing a larger role by increasing awareness and setting expectations

• Non‐traditional collaboration is the new paradigm and opportunity

• Leadership and shared responsibility is key to driving change across the value chain

• Packaging is the most visible Company element and is a magnet, target and opportunity


Special thanks to PTIS & DuPont P&IP

Thomas BlackVP & Global Alliance Manager

• http://www.plantic.com.au/index.cfm

• http://www2.dupont.com/Renewably_Sourced_Materials/en_US/index.html

A convergence of forces is affecting packaging organizations in ways not previously considered


• http://biopolymer.materialdatacenter.com

• http://www.biopolymers.net

• Kale et al, Macromolecular Bioscience 2007

• Packaging Digest Survey

• “A Sustainable Packaging & Marketing Case Study,” Rob Kaplan, Fetzer Vineyards, 2009

• Norampack, Louis Lemaire, 2009

• “It’s not easy being (truly) green, Michael Rubenstein, Alcan Packaging, 2009

• “Rattling Supply Chains,” WRI & A.T.Kearney

Resources

Thanks to all…

tappi flexible packaging 2009...• today’s population 6.7 billion; 50% in just 6 countries •...

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