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Published on November 14, 2007

The company plans to mobilise Bt1 billion by issuing 40 million shares at the par value of Bt10 to fund expansion of its plastics and packaging business. It has registered capital of Bt1.95 billion.

The company will form a 50:50 joint venture with US-based Escospan, a leading petrochemical manufacturer, to establish a biopackaging plant on a 200-rai site in Rayong province producing mainly glasses and packages.

Marss Wan Cheng Kuo, president and CEO, said of the total investment Bt200 million was for the new packaging plant and the remainder for expansion of the existing plastic sack plant in Nakhon Ratchasima.

The packaging plant, with capacity of 5,000 tonnes a year, will start operating in next year's third quarter and generate sales of US$25 million (Bt845 million) a year, he said.

The output will be exported mainly to the United States.

"Bioplastic products are forecast to have greater demand despite production costs of 15-20 per cent more than for general plastic goods. The price gap will be narrowed in line with skyrocketing oil prices," he said.

The plant will be the first to produce plastic replacements made from corn. The main products will be glasses, cups, bowls, trays and cards.

All of the CP Group's packages will use bioplastics instead of polluting materials.

According to the company's research, bioplastic packages are microwaveable and decomposable within 15 months. General plastic goods take at least 100 years to disintegrate.

To ensure raw material supply, the company plans to raise corn here now and in neighbouring countries later.

CPPC's sales reached Bt12.8 billion last year and are expected to climb 8 per cent to Bt13.9 billion this year, although this is less than originally forecast due mainly to the baht's appreciation.

Chaipong Chainapaporn, senior vice president, said the expansion of the bioplastic-sack plant would boost sales from Bt2 billion now to Bt2.5 billion in the near future.

The plant will serve both foreign and domestic customers, particularly rice packagers.

Global demand for plastic products has reached 160 million tonnes worth $250 billion a year and is growing 6 per cent annually.

The company operates 10 factories in Thailand, four in China and one in Vietnam. With business in Thailand growing, the company is considering expanding in those two countries.

Petchanet Pratruangkrai

The Nation