[The Industrial Heart Beats Again] Waste Plastic Reborn as IT and Automotive Materials

LG Chem Projects 20% Annual Growth in PCR PC Sales
Last Year's Sales 50 Billion KRW... 60 Billion Expected This Year
Rising Demand for Recycled Plastic Materials Amid ESG Management Trend
Customer Base Expanding from Google and Samsung to Automakers

[Asia Economy Reporter Hwang Yoon-joo] "With the full-scale implementation of ESG (Environmental, Social, and Governance) management, inquiries about 'Polycarbonate (PCR PC) products mechanically recycled from waste plastic' have noticeably increased since last year. IT and electronics companies were the main customers, but this year, industrial materials and automotive companies are also asking if product manufacturing is possible."

The chemical industry, which has experienced a boom since COVID-19, has started a war against waste plastics. This is because environmental issues caused by waste plastics have come to the forefront amid the surge in demand for petrochemical products. The establishment of ESG management as a global standard also played a part. Customers using polycarbonate (PC) materials have begun to demand the production of PCR (Post Consumer Recycled) products, which are made by collecting and recycling waste plastics discarded after consumer use.

◆ No.1 in ‘Compound’ Technology Competitiveness = Recently visited LG Chem’s factory in Iksan, Jeonbuk. Around the factory, PCR PC products waiting for shipment were stacked high. Lee Hyo-gyu, head of the HR team at LG Chem’s Iksan plant, said, "With the increase in customer demand due to ESG management, sales this year are expected to increase by about 20% compared to the previous year. This trend is expected to continue until 2025."

PCR refers to the mechanical recycling method that collects waste plastics such as discarded headlamps and transparent partitions for droplet protection and converts them into ‘pellets’ (plastic granules), the raw material for PC. PCR PC (based on 50% PCR content) can reduce carbon emissions by as much as 40% compared to regular products. Using 10,000 tons of PCR material has the same effect as reducing the carbon emissions of more than 14,000 cars over one year.

As a result, demand for PCR PC is increasing mainly among global IT and home appliance companies. Consequently, LG Chem’s PCR PC production scale has been increasing from 870 tons in 2009, 800 tons in 2012, 6,400 tons in 2015, 11,400 tons in 2018, to an estimated 19,000 tons in 2021.

In particular, as customers seek products with higher PCR content, LG Chem’s Iksan plant has become busier. When the product was first produced in 2009 at Samsung Electronics’ request, the PCR content was only 30%, but recently, products with PCR content increased to 60% have been commercialized.

LG Chem’s product competitiveness comes from its ‘compound’ technology. Compounding is the process of mixing additives into plastic pellets to impart functions such as flame retardancy and impact resistance. They have also succeeded in developing products with PCR content increased to 85%. LG Chem aims to develop products with PCR content increased up to 95%.

◆ Largest Range of PCR PC Colors = Another competitive edge of LG Chem’s Iksan plant is its ‘Color Design Center.’ Unlike general PC products, it is not easy to realize colors in PCR PC. In the past, AI speakers, laptops, and home appliances using PCR PC materials were only available in black or gray. LG Chem not only realizes various colors but also can express materials such as wood and marble. Park Su-jin, head of the Color Development Team at LG Chem’s Color Design Center, explained, "Even white, which is difficult to produce in PCR PC, can be produced in different brightness and saturation levels," adding, "Recently, with the trend of customized home appliances, we also developed an olive green color."

PCR PC, a collection of eco-friendly material technology and product development, is priced 10-20% higher than general PC. LG Chem’s Iksan plant’s engineering plastics sales amounted to 274.8 billion KRW last year, of which 50 billion KRW came from PCR PC. This year, PCR PC annual sales are expected to expand to 60 billion KRW. Until now, IT and home appliance companies such as Google, Amazon, and Samsung have been the main customers, but with the strengthening of carbon emission regulations, global automakers and industrial materials companies have also started to show interest. To respond to this trend, LG Chem’s Engineering Materials Division has established a 25-member TDR (Technology Development and Research) team, an innovative organization that carries out projects for specific tasks over a set period.