Tuesday, June 24, 2008

Green Innovation in an Emerging Market

With surging oil prices, green-minded consumers, and the driving success of Brazilian ethanol coming into place, large plastic makers are aiming to fabricate plastics in Brazil using plant-based materials like sugarcane. According to this article in Business Week, even though plastic manufacturing is $350 billion dollar a year business, “organic plastics” will not yet replace traditional plastics anytime soon. Plastic manufacturing companies like Braskem and Dow plan to produce in Brazil by 2012 about 1% of the world plastic demand, which is growing roughly 5% every year.

One of the setbacks of this alternative plastic is that it does not melt into the environment like biodegradable products even though they are recyclable. Even so, I believe other huge plastic manufactures will follow suit after seeing big players like the Sao Paulo based Baskem and Dow moving to compete favorably with petroleum based plastics. Also, more and more companies are thinking “green” as consumers and businesses become more conscious of environmental protection.

One thing is for sure, companies will have to fix the problem of “organic plastic” disposal so that it won’t end up clogging landfills or floating in the Pacific Ocean before the rest of the world adopts this practice. But, with the growing demand and need for green innovation, it’s only a matter of time before a solution is posed.

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