Transit costs drive Plantic into Europe

The Australian manufacturer of biopolymers for packaging said its European sheet thermoformer customers supported the plan. UK end-users of Plantic’s products include Marks & Spencer and Sainsbury’s.

A Plantic spokesman said it was considering Eastern Europe as a location. Sea freight accounts for 12% of Plantic’s sales costs in Europe.

The firm has also extended its agreement with DuPont to market its plastic packaging made from renewable resources in Japan, which is expected to provide a “strong platform” for growth.

This follows a deal, signed last September, for DuPont to market Plantic’s starch-based sheet materials in North America and injection-moulding resins globally, excluding Australia and New Zealand.

Product development agreements have also been signed with National Starch to provide the firm with high-amylose cornstarch, the raw material for its products, and with US packaging firm Bemis to develop flexible packaging films and to supply products for sale into the US market.

Plantic admitted at its annual general meeting in Melbourne at the end of May that “not all in 2007″ went according to plan.

“With hindsight, sales projections for rigid sheets in Europe and injection-moulding resins in the US were far too optimistic,” the firm said.

The firm has since made changes to its European structure and management team, which were starting to “deliver progress”. It added that projected sales in the US would come through during 2008.

Plantic launched HP1, a new high-performance biodegradable packaging sheet, at Interpack in April.

Chairman Ian Wightwick said the company had improved the quality of its rigid sheets by fitting modern automated controls.

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