Bioplastics entice in the Materials Sector

A new research report published by companiesandmarkets.com indicated that bioplastics, or plastics composed of renewable resources, will grow at a considerable pace over the coming 5 years. The global consumption of bioplastics is valued at 571,712 metric tons in 2010, with a compound annual growth rate (CAGR) expected to surge 41.4% by 2015. 3,230,660 metric ton of bioplastics, which can be composed of sugarcane, soy beans, corn and algae, are anticipated to be in use by 2015.

According to the report, published Dec. 10, market forces, most notably environmental concerns such as global warming, waste and toxic waste disposal have hastened the pace of development and use of bioplastics.

A recent investment by venture capitalist firm, Horizon Technology Finance Corporation (NASDAW: HRZN) confirms the research published by companiesandmarkets.com. Completed yesterday, Horizon made a $ 5 million growth capital investment in Cereplast, a leading bioplastic company, which produces compostable resin that can biodegrade in less than 180 days. The company produces 16 million pounds of bioplastic a year according to its C.E.O. Frederic Scheer.

Scheer, an investment banker before he began Cereplast, has been making predictions mirroring the report since 2000 when the company was born. He, along with many venture capitalists believe bioplastics will become the gold standard over the next couple of decades. Scheer predicts the market will be roughly 30% biodegradable plastic by 2025 in comparison to the 1% it accounts for today.

Companies are increasingly looking at bio-based plastics made from renewable resources like corn, wheat, and algae as an alternative to petroleum-sourced plastics in order to meet soaring consumer demand for economically and ecologically sound, ‘green’ products.

Scheer for his part is laboring to give them want they want and improve on current options. At present, he is working on developing a plastic made 100% from algae. He expects it be marketable within the next decade.

The investment from Horizon Capital will go toward making that happen, facilitating the purchase of additional raw materials and working capital needed to meet rapidly increasing global demand for Cereplast resin.

If bioplastics, which companiesandmarkets has identified among the most “major materials stories of the period starting in 2010,” follows the path predicted by analysts and industry professionals, it w

Source

World Market Media, 2010-12-22.

Supplier

Cereplast Inc.
Horizon Technology Finance Corporation

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