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Plastic Recycling Joint Venture Formed

Posted on: Monday, 14 November 2005, 18:00 CST

By Li Wenfang

GUANGZHOU: To solve issues such as reducing electronic waste at landfills, saving energy and supplying plastics to the thirsty Chinese market, MBA Polymers Inc has turned to recycling.

The company is starting such operations at its first factory outside the United States in Guangzhou, capital of southern China's Guangdong Province, this week.

Three times the size of the US plant, the joint venture with Guangzhou Iron & Steel Enterprises Group, or GISE-MBA New Plastics Technology Co, recycles plastics from electronic durable goods such as computers, fax machines, mobile phones, refrigerators and microwave ovens.

"We chose China for the venture because there is such a huge demand for plastics," said Richard McCombs, president of MBA Polymers and a board director of the Guangzhou joint venture.

The US$12 million project has the capacity to process 6 tons of scrap plastics per hour and to turn out around 26,000 tons of finished plastic products per year.

The finished plastic products include polypropylene (PP), high impact polystyrene (HIPS) and acrylonitrile butadiene styrene (ABS), which can be used to form the plastic components of electronic goods.

Other plastics can be sold to produce manhole covers and pumps, among other things.

Plastics from durable goods are harder to recycle than those from bottles for example. MBA Polymers Inc has the proprietary technology of recognizing and separating plastics by chemical type mechanically to allow mass production.

As a private firm founded in 1994, it has received investment from more than six companies such as Dow Chemical, Apple Computer, Ford Motor, General Electric, Matsushita and International Finance Corp under the World Bank.

The venture buys scrap plastic for about US$100 per ton and sells its products for between US$800 and US$1,000 per ton.

Currently, MBA Polymers Inc imports the scrap plastic because though scrap plastic is abundant in China, the legislation is not in place so there is no coordinated effort to collect end-of-life products and recycle them, McCombs said.

While China is planning its economic and social development over next five years, McCombs said that "I believe there will be more effort to increase efficiency, conserve more resources and put greater emphasis on recycling."

On the demand side, McCombs said that Guangzhou requires a lot of plastic and in the future, companies such as General Electric's plastics unit, contract manufacturer Flextronics International, Hewlett Packard and Hitachi would demand their operations in China.

The Guangzhou venture saves 90 per cent more energy when comparing it to the process of making virgin plastics, and thus is a step towards energy efficiency.

McCombs expects that this venture could generate US$15 million in revenues per year when running at full capacity.

"Our growth (in China) will depend on the speed at which we can develop our business. Part of that development will require us to find good people to train to increase our efficiency and capacity."

GISE-MBA will eventually share the role of research and development, McCombs said, adding that the next big opportunity would be to recycle automobile plastics, which is technically more difficult at present.

Back in the US, MBA Polymers provides consulting services to computer companies advising them on how to improve the "recyclability" of their products, and it plans to provide the same service in China, McCombs said.

MBA Polymers is also currently building a factory in Austria and intends to build another in Europe and Asia.

Source: China Daily; North American ed.

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