Investors eye US-made plastic alternative

Investors in China have shown interest in a Georgia-based company that produces what it says is an alternative to conventional plastic that is totally biodegradable and is made using a product produced in the US and China - cooking oil.

On Sunday, Paul Pereira, executive chairman and CEO of MHG, the holding company for Meredian and DaniMer Scientific, led a tour of his company's manufacturing facilities in Bainbridge, Georgia, about 230 miles south of Atlanta, for potential investors from the cities of Shenzhen and Shanghai.

MHG's Meredian unit manufactures PHA, or polyhydroxyalkanoates that are not petroleum-based. They use canola oil, which is used for cooking. The result is a plastic that is 100 percent biodegradable, compostable and generates no toxic waste during production, according to the company.

Canola oil comes from the seeds of the canola plant. Once harvested, canola seeds are crushed and the oil contained within the seed is extracted. The average canola seed is 45 percent oil.

Pereira said his company plans to sharply increase the production of canola near its Bainbridge pant. China is one of the leading producers of canola, but Pereira said the country's production has decreased.

"They use an agri-mulch film to cover the canola. They have been burying this film back into the fields. The result is their production has declined 30 percent. We are working on making a film with our technology so it will completely degrade in the field with no harmful side effects," he told China Daily.

The Chinese investors who visited Georgia are looking to invest in MHG in conjunction with the EB-5 program or the investor-immigration program. It allots 10,000 visas to foreigners every year who seek residency in the US through investing at least $500,000 in US projects that create at least 10 self-sustaining, full-time jobs for Americans. Applicants who are given the visas can also acquire permanent residency status with their family members.

"I will accompany the potential investors back to China and I will hold meetings with about 15 to 20 other investment groups. Some of them are EB-5 applicants while others are considering a direct investment," he said.

"We are in the process of raising $120 million to ramp up production," Pereira told China Daily. His company had $14 million in sales in 2013 and expects to do up to $16 million this year, he said.

"We employ about 100 directly and up to 400 indirectly. With the financing and increased production, we could be responsible for 2,000 to 3,000 jobs directly and indirectly in Georgia," Pereira said.

According to Pereira, the company's manufacturing process involves micro-organisms, which are too small to be seen by the human eye. "The interesting thing is that these are everywhere and they are used to not only make the biodegradable plastic but they also destroy it," he said.

"It means you can take a plastic water bottle made with our PHA biopolymers and leave it in your backyard. In less than 30 days, the bottle will completely disappear leaving no residue in the ground or in the air," said Pereira.

"We have received FDA (US Food and Drug Administration) approval that certifies our biopolymers are safe to use as food containers and storage by the public."

MHG's DaniMer acquired the technology from consumer-products giant Procter and Gamble Co in 2007.

The market for PHA has been recovering since 2012 when Archer Daniels Midland Co ended a joint venture with Metabolix for the production of PHA bioplastics that used the brand name Mirel. Later that year Meredian opened the world's largest PHA manufacturing plant in Georgia.

paulwelitzkin@chinadailyusa.com