Dow and Crystalsev to make bioplastic in Brazil

Dow Chemical (NYSE: DOW) and Crystalsev, one of Brazil's largest ethanol companies, announced plans today to build the world's biggest polyethylene from sugar cane plant in Brazil.

Polyethylene is the most widely used of all plastics, and can be found in all manner of everyday products, including food packaging, milk jugs, plastic containers, pipes and liners.

Dow and Crystalsev are to form a joint venture in Brazil to design and build the first integrated facility of its scale in the world.

It's expected to start production in 2011 and will have a capacity of 350,000 metric tons.

The venture is expected "to meet the needs of Dow's customers in Brazil" and attract "what will likely be international interest," the two companies said today.

The new facility is to use ethanol derived from sugar cane, a renewable resource, to produce ethylene, the raw material required to make polyethylene.

Ethylene is traditionally produced using either naphtha or natural gas liquids, both of which are petroleum products.

It is estimated that the new process will produce significantly less CO2 compared to the traditional polyethylene manufacturing process.

Areas being considered as potential sites for the new facility are currently being used for low-density cattle grazing and are not near any rain forests, the companies said, underscoring what they called their commitment to ensuring that the plant is located in a sustainable environment.

Critics of plastics made from renewable materials have pointed out that they are not all engineered to biodegrade.

They urge consumers to continue to recycle, no matter how 'green' chemical companies portray their products in their advertising going forward.

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