Natureworks: Market Development for Bioplastics
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Case Details:
Case Code : MKTG169
Case Length : 23 Pages
Period : 1997-2007
Pub Date : 2007
Teaching Note :Not Available
Organization : NatureWorks
Industry : Chemicals and Petrochemicals
Countries : USA
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Introduction Contd...
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One was the rapid increase in petroleum prices and the consequent rise in prices
of petro-based plastics (the main substitutes for PLA), and the other was the
growing public demand for a ban against single-use plastic bags.
Though, by 2007, there was wide interest in PLA, the company faced some
challenges as well. There were concerns about NatureWorks using genetically
engineered (GE) corn produced by Cargill to manufacture PLA. NatureWorks was
able to address this issue, to an extent, by offering non-GE corn-based PLA,
which it sold at higher prices than the usual variety.
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However, it continued to face criticism from environmentalists who argued that
by aggressively marketing PLA, NatureWorks was in fact promoting genetic
engineering. The company was also criticized for diverting a resource meant
for human consumption to make plastics. Another, and potentially the most
damaging, challenge came from recycling associations demanding a moratorium
on the production of PLA because of the problems that PLA created for PET9
and HDPE10 recycling programs.
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Background Note
Cargill was founded by William Wallace Cargill (W.W.) and his brother,
Samuel Davis Cargill (Sam), in 1867 as a partnership firm, W.W. Cargill
& Brother (WWC&B). The firm constructed a grain flathouse11 and opened a
lumberyard in Lime Springs, Iowa. In 1868, W.W. moved to Austin,
Minnesota, where he acquired several flathouses. In 1875, W.W. moved his
headquarters to La Crosse, Wisconsin. In 1884, while W.W. managed the
operations at Wisconsin, a new entity called Cargill Brothers, based at
Minneapolis and controlled by Sam, was established for the operations in
Minnesota and the Dakotas. |
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