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Green Matter: Metabolix formalizes collaboration with Samsung Fine Chemicals

Metabolix is formalizing the collaboration arrangement that has been in place since 2012 with Samsung Fine Chemicals During. That announcement came in an earnings call yesterday, July 31. The goal of the collaboration is to "expand the global market for biodegradable polymers", according to Richard Eno, President and Chief Executive Officer at Metabolix. It will also give the company direct access to the biodegradable biopolymers in Samsung Fine Chemical's portfolio, paving the way for the development of new, blended formulations.

Karen Laird

August 1, 2013

3 Min Read
Green Matter: Metabolix formalizes collaboration with Samsung Fine Chemicals

Samsung and Metabolix are pursuing similar strategies, with complementary products "designed to deliver best performance and value to targeted customer applications", and complementary regional positioning.

Metabolix, with its PHA materials, is focused on the U.S. and Europe, while Samsung has a strong market presence in Korea and across Asia with other biodegradable biopolymers, including PBAT and PBS. Hence the products developed by the two companies together will compliment each other's product portfolio. As Mr. Eno observed: "Both companies have substantial skills in product and process development and we're excited to continue our work together in a more formal way to support new product development and market growth in biopolymers.

Growing the market for PHA
According to Mr. Eno the key drivers of his company's growth strategy included targeting advanced materials market through PHA technology, building a portfolio of biopolymer products that focused on film, performance additives and functional biodegradation segments. "We are building a portfolio, products where our PHA polymers can provide value-add solutions for customers and as a result, command an attractive price in the marketplace," he commented. Metabolix also aims to establish strong customer relationships supported by long term contracts in advance of commercial production, to validate market demand. The company is currently working to create a robust supply chain based on approximately 10,000 tons per year of PHA capacity.

"Establishing an ongoing source of PHA supply to integrate with other biodegradable polymers for customer benefit is a key part of our strategy," said Mr. Eno.  "We continue to develop our supplier relationship with Tianjin GreenBio Materials in China.  In Spain, the situation at Antibioticos is becoming clearer - financial restructuring is underway and new ownership is emerging - and we are actively engaged in an evaluation of options for manufacturing at that site. In addition, we are conducting due diligence on two potential U.S. manufacturing sites."

This captive capacity will be used both in neat PHA formulations and in proprietary blends with biodegradable polymers sourced from third parties. The company sees the development of proprietary polymer formulations as a means to increase both its product range and the overall revenue potential of its business model. "The expertise we have gained in how the PHA polymer family can be integrated with other biopolymers creates a differentiating position for us," was how Mr. Eno put it.

He was upbeat about developments in the PHA business, noting: " We are fortunate in that the biopolymer markets we are serving are exhibiting strong growth with third party studies showing growth rates of 15% to 20% per year. We are clearly seeing that level of interest in the magnitude of the inbound enquiries we are receiving for product data and samples across our targeted segments of film, performance additives and functional biodegradation."

"We believe our current business plan for the research plant based on PHA production as well as products made from proprietary formulations has the potential to generate approximately $100 million in annual profit product revenue," he said. "Our PHA platform also enables us to produce highly differentiated biobased chemicals and use crops as a biorefinery system, both offer the means for additional commercial opportunities and valuation creation," he said.

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