19 April 2006

Chinese company from Hong Kong to build packaging factory in Brazil

Chinese packaging company, Roots Biopack, which is headquartered in Hong Kong, plans to invest US$4 million in building a packaging factory in Brazil this year, the company said.

The Brazilian unit, the Chinese company’s first foreign factory, will produce paper packaging using sugar-cane bagasse, the company’s chairman, Gerald Lau said.

The chairman told Friday’s edition of Brazilian financial daily Valor Económico that representatives of Roots Biopack would visit Brazil in June to begin negotiations with the aim of finding local partners and suppliers.

The cost of sugar-cane bagasse is 50 percent less than the traditional raw material used for producing cardboard packages.

Another advantage is that this type of package is biodegradable, within six montsh fo its use, which is in line with increasing concerns about environmental conservation, said Lau.

“In two years, the world packaging market will go through great change,” said the Roots Biopack chairman.

Lau also said that the Chinese group planned to build other units in the future in Mexico, Malaysia and Indonesia.

In China, the company controls a unit with a capacity to produce up to 2,000 tons of paper packaging per month.

Roots Biopack is currently spending US$150 million on a new unit in China with a production capacity of 200,000 tons per month, which is due to begin production in 2009.

Founded in 1995, the Roots Biopack group includes amongst its customers sneaker manufacturers Mizumo, as well as US fast food chain McDonald’s in Asia and France’s Carrefour supermarket chain in Europe.

The decision to invest in Brazil is the result of the availability of sugar-cane bagasse in Brazil, as it is a byproduct of biofuel production.

Currently, Brazil ahs the largest program in the world for substituting oil for renewable fuels that have lower carbon emissions into the atmosphere.

Source: macauhub.com April 18, 2006.

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