Transforming Sugarcane into Bioplastics

Opportunities and Challenges for Indian Sugar Mills

• Dilip Patil

As the world shifts towards sustainable alternatives to petroleum-based plastics, Polylactic Acid (PLA) has emerged as a frontrunner in the bioplastic revolution. Derived from renewable feedstocks like sugarcane, PLA is biodegradable, eco-friendly, and versatile, making it ideal for applications in packaging, textiles, medical devices, and 3D printing.

Why PLA?

The global bioplastics market is projected to grow at a CAGR of 15% from 2023 to 2030, driven by increasing environmental awareness and stringent regulations on single-use plastics. PLA is biodegradable and compostable, reducing plastic pollution and carbon footprints. For sugar mills, PLA production provides an alternative revenue stream, reducing reliance on sugar and ethanol markets. Policies like the National Policy on Biofuels and Production-Linked Incentive (PLI) Scheme offer subsidies and incentives for bioplastics production.

Process Flow of PLA Production

The production of PLA involves a multi-step process that converts sugarcane into high-quality bioplastic.

1. Feedstock Preparation
   Raw Material: Sugarcane is crushed to extract juice, which is clarified and concentrated into syrup or converted into sugar.
   Molasses: A byproduct of sugar production, molasses can also be used for fermentation.
2. Fermentation
   Microbial Fermentation: Lactic Acid Bacteria (LAB) ferment glucose/fructose into lactic acid.
   Operating Conditions: Temperature of 35–45°C, pH of 5.5–6.5, and anaerobic environment.
   Yield: Approximately 0.5-0.6 kg of PLA can be produced from 1 kg of sugar.
3. Purification of Lactic Acid
   Filtration: The fermentation broth is filtered to remove microbial cells and solid waste.
   Ion Exchange: Lactic acid is purified using ion-exchange resins.
   Evaporation: Lactic acid is concentrated through evaporation and crystallized into a pure solution (~90%).
4. Polymerization
   Lactide Formation: Lactic acid undergoes dehydration and cyclization to form lactide, a cyclic dimer.
   Ring-Opening Polymerization (ROP): Lactide is polymerized using metal-based catalysts to produce high-molecular-weight PLA.
5. Extrusion and Pelletization
   The PLA is melted, extruded, and pelletized into small granules for commercial use.
6. Final Processing
   PLA pellets are processed into end products such as films, fibers, and molded items.

Economic Viability of a PLA Plant

While the economic viability of a PLA plant depends on various factors, a plant with a capacity of 50,000 tons per year might be considered economically viable if it can achieve competitive production costs and secure a stable market share. However, the minimum economic size of a PLA plant can vary depending on factors like production costs, market demand, and competition.

Financial Viability of a 50,000 MTPA PLA Plant

Capital Expenditure (CapEx)
Total Investment: ₹1,500 crore.
Breakdown:
Plant setup (fermentation, polymerization, purification): ₹900 crore.
Infrastructure (land, utilities, automation): ₹400 crore.
Technology licensing and working capital: ₹200 crore.

Operating Expenditure (OpEx)
Raw Materials:
Sugar requirement: approximately 83,000-100,000 tonnes/year (based on 0.5-0.6 kg PLA/kg sugar).
Utilities:
Power: ₹50 crore/year.
Water: ₹10 crore/year.
Steam: ₹25 crore/year.
Labor and Maintenance: ₹60 crore/year.
Total Operating Costs: ₹670-₹830 crore/year.

Revenue Potential
PLA Selling Price: ₹120-₹180 per kg (depending on the specific grade and application).
Annual Revenue: 50,000 tonnes × ₹150/kg (average price) = ₹750 crore/year.

Profitability
Gross Profit: ₹750 crore – ₹750 crore (average operating costs) = ₹0 crore/year (break-even point).
Depreciation (10 years): ₹150 crore/year.
Net Profit Before Tax: -₹150 crore/year (loss).
Taxes (25%): ₹0 crore/year (no taxes due to loss).
Net Profit After Tax: -₹150 crore/year (loss).

Challenges and Mitigation Strategies

1. High Initial Investment
   Challenge: The ₹1,500 crore CapEx is a significant barrier.
   Solution: Avail government subsidies under the PLI Scheme or partner with private investors.
2. Sugar Price Volatility
   Challenge: Fluctuations in sugar prices can impact production costs.
   Solution: Secure long-term contracts with sugarcane farmers to stabilize prices.
3. Competition from Conventional Plastics
   Challenge: PLA is more expensive than petroleum-based plastics.
   Solution: Focus on high-value applications like medical devices and 3D printing.
4. Technology and Expertise
   Challenge: Lack of large-scale PLA production expertise in India.
   Solution: Collaborate with global PLA manufacturers for technology transfer and training.

Opportunities for Sugar Mills

1. Diversification: PLA production provides an alternative revenue stream, reducing dependency on sugar and ethanol markets.
2. Sustainability: Enhance brand image by adopting eco-friendly practices.
3. Export Potential: India can become a global PLA export hub, leveraging its cost advantages in sugar and labor.
4. Synergies: Integrate PLA production with ethanol plants and bagasse cogeneration to optimize resource utilization.

Key Recommendations for Aspiring Sugar Mills

1. Conduct thorough market research and feasibility studies to determine the viability of PLA production.
2. Secure long-term contracts with sugarcane farmers to stabilize raw material costs.
3. Collaborate with global PLA manufacturers for technology transfer and training.
4. Focus on high-value applications like medical devices and 3D printing.
5. Explore government subsidies and incentives under the PLI Scheme and other programs.

Conclusion

A bioplastics plant can be a financially viable and strategically sound investment for sugar mills looking to diversify and embrace sustainability. While the minimum economic size of a PLA plant can vary, a 50,000-ton-per-year plant might be considered economically viable if it can achieve competitive production costs and secure a stable market share. By leveraging India’s cost advantages in sugar and labor, sugar mills can capitalize on the growing demand for bioplastics and contribute to a greener future.

For Further Information:

Contact your local industry association or government agency to explore subsidies and incentives for bioplastics production. Collaborate with research institutions like IITs or CSIR for technical support and R&D.

Disclaimer: The figures mentioned in this article are based on publicly available information and should be used as a general guide only. Actual figures may differ from the above, and it is recommended that investors and stakeholders conduct their own research and consult with industry experts before making any investment decisions.

Author Dilip Patil is Managing Director of Karmyogi Ankushrao Tope Samarth Co-op Sugar Factory, Ambad -Jalna.