Main market-listed SCGM Bhd will start manufacturing the polylactic acid (PLA) food packaging containers for the US market in the first quarter of next year.
Executive chairman and managing director Lee Hock Seng said the PLA containers were made from 100% plant-based by-products such as barley, tapioca and corn, and were biodegradable.
He said unlike plastic food containers made from petroleum by-products which could take up to 100 years to decompose, PLA food containers only needed six months to fully disintegrate.
Lee said the plastic packaging manufacturer had invested RM2mil in a new machine using German technology to produce the PLA food containers and had already started trial production runs.
He said SCGM would initially produce about 250 tonnes of PLA food containers monthly for American buyers and gradually raise output over time.
“After the United States, we are going to Europe as demand for environmental-friendly packaging materials there is good,” Lee told StarBiz after the company AGM recently.
He said most food items sold in hypermarkets, supermarkets and takeaway outlets in the United States and Europe were packed in PLA food packaging materials as consumers were concerned about the environment.
Lee said although raw materials for the PLA food containers were more expensive than petroleum by-products and had to be imported, the finished PLA food containers commanded better selling prices.
He said SCGM had no plans to sell its PLA food containers to Asian countries as their usage was still low and it was not mandatory in the region to use such packaging for food sold at hypermarkets and supermarkets.
“Taiwan is the only country in Asia doing that and they (retailers) strictly follow the rule.
“Even Singapore and Japan have yet to impose such ruling,” added Lee.
It would take countries in Asia a long time to emulate Taiwan, he said, adding that the “no plastic day” ruling introduced by the Penang and Selangor governments did not go down well with consumers.
SCGM subsidiary Lee Soon Seng Plastic Industries Sdn Bhd is involved in the manufacture and trading of thermo-vacuum formed plastic packaging and extrusion sheets which it exports to China, India, Hong Kong, Myanmar and the United States.
For the financial year ended April 30, SCGM recorded a net profit of RM6.65mil and revenue of RM67.71mil compared with RM5.18mil and RM61.75mil respectively the previous year.
