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Insight | Time: Nov 12 2020 2:38PM
Biodegradable plastic PBAT develops rapidly
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In 2008, the Old "Plastic Limit Orders" stipulated that non-degradable plastic bags were charged. The Upgraded "Plastic Limit Orders" are coming fiercely and involves a variety of plastic products.

The Law of the People's Republic of China on the Prevention and Control of Environmental Pollution by Solid Wastes (2020 Amendment) has been revised and adopted at the 17th meeting of the Standing Committee of the 13th National People’s Congress of the People’s Republic of China on April 29, 2020, and came into effect on September 1, 2020. In a notification published on August 28, 2020, the Chinese Ministry of Commerce outlined a set of upcoming restrictions on the use of plastics within the country. According to the documents issued by the National Development and Reform Commission and the Ministry of Ecology and Environment in January, 2020, non-degradable disposable plastic straws are prohibited in the catering industry nationwide by the end of 2020.

The impact of the new “Solid Waste Prevention and Control Law” and the new “Plastic Limit Order” in China on the main products of the polyolefin industry from a quantitative perspective:

Products total effects contents amounts period
PE Reduced by 2.8 million tons, accounting for 8% of apparent demand Non-degradable plastic bags are prohibited for packaging such as postal express delivery. 800kt 2022-2025
The use of non-degradable plastic bags is prohibited in takeout, shopping malls, supermarkets and bazaars. 2.0 million tons the third quarter of 2020-the end of 2025
PP Reduced by 920kt, accounting for 3.6% of the apparent demand. Non-degradable disposable plastic tableware, etc. 840kt the third quarter of 2020-the end of 2022
Express packaging industry disposable woven bags and tape 80kt 2022-2025

From a demand point of view, PE and PP will yield profits of about 3.7 million tons/year to biodegradable plastics.

Classification of plastics

Among biodegradable plastics, biodegradable bio-based plastics are easy to acquire raw materials and have the advantages of relatively low cost and strong extensibility, and have a broader space for development in the future.

Among them, PBAT is expected to become the largest bio-based biodegradable plastic product in the future due to its more mature technical engineering and lower investment intensity, combined with the nature, use field, and production cost of PBAT.

PBAT (short for polybutylene adipate terephthalate) is mainly based on 1,4-butanediol (BDO), adipic acid (AA), terephthalic acid (PTA) [or dimethyl terephthalate(DMT)] used as raw material and is prepared by direct esterification or trans esterification.

PBAT is a semi-crystalline polymer with crystallization temperature around 110C, melting point around 130C and density between 1.18g/ml~1.3g/ml. The crystallinity of PBAT is about 30%, and the Shore hardness is above 85. PBAT is a copolymer of aliphatic and aromatic, which combines the excellent degradability of aliphatic polyester and the good mechanical properties of aromatic polyester. It not only has good extensibility and elongation at break, but also has good heat resistance and impact properties.

As a product needed by the times, PBAT currently shows excess benefits, with a benefit of around 10,000 yuan/mt, which is much higher than that of all kinds of conventional plastic products at present. Up to now, the total nominal production capacity of PBAT at home and abroad is more than 400kt/year, and more than 3 million tons of China domestic plants are planned to be put into production in the future.

For a detailed understanding of PBAT's development status, raw material performance, investment details, future supply and demand trends, and etc., please pay attention to the report recently launched by CCFGroup-- China's biodegradable plastic PBAT market study
[RISK DISCLAIMER] All opinions, news, analysis, prices or other information contained on this report is provided by analyst of Zhejiang Huarui Information Consulting Co., Ltd (CCFGroup) as general market commentary and does not constitute investment advice. CCFGroup will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.
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