February 25, 2025 – LG Chem Halts PBAT Production Amid Market Uncertainties
In a recent development, industry insiders have revealed that LG Chem has temporarily suspended operations at its Polybutylene Adipate Terephthalate (PBAT) plant located in Daesan, and has initiated a redeployment of its workforce. Initially, the company had planned to commence large-scale production in 2025, following a successful trial run in 2024. However, citing concerns over profitability and a relaxation of environmental policies in key markets, LG Chem has decided to indefinitely postpone its mass production plans. This comes as a surprise, given the company’s previous emphasis on increasing investments in eco-friendly materials as a core strategy for future growth.
A spokesperson for LG Chem emphasized, “Despite the setback in our PBAT mass production plans, we remain committed to this business segment.” He further explained that this decision is part of the company’s strategy to adapt flexibly to market changes and optimize its product portfolio efficiency.
In August 2021, LG Chem invested KRW 210 billion (approximately RMB 1.06 billion) to construct a PBAT plant with an annual capacity of 50,000 tons in Daesan, Chungcheongnam-do, on the west coast of South Korea. PBAT, a biodegradable resin, rapidly decomposes through microbial action, offering an innovative solution to environmental issues such as plastic waste. It is also seen as an ideal alternative to single-use plastics.
According to AsiaMB, the adjustment in LG Chem’s decision-making has undoubtedly caused some fluctuations in the PBAT market. However, it also reflects the company’s agile response strategy in the face of market and policy changes. The future layout and development of LG Chem in the field of eco-friendly materials continue to be a focus of industry attention.