Plastic bags disrupted the paper packaging industry decades ago, but a plant-based alternative material being developed has the potential to reshape the sector once more.
Packaging and paper manufacturer SCG Packaging Plc (SCGP) plans to use eucalyptus as a raw material to produce a new plastic that may disrupt current plastic bag manufacturing.
The company plans to finish its study within this quarter on how eucalyptus can be turned into bioplastic, replacing petroleum-derived plastic, said chief executive Wichan Jitpukdee.
This is a joint project with US company Origin Materials to develop a material for customers who want to avoid using products made from manufacturing processes that emit carbon dioxide or cause waste disposal problems once they are discarded.
"I now realise paper is a strength of SCGP's business," said Mr Wichan.
The company still produces paper, but adapted techniques to make its production more environmentally friendly and continues to grow businesses with the aim of offering better packaging and printing solutions, as well as environmental stewardship.
RISE OF BIOMASS
Paper production, once blamed for destroying forests, can form part of efforts to combat global warming and support new biomass-based businesses that promote novel uses of wood materials.
"At one point we thought we may exit the paper business, especially when it was disrupted by the iPad, but we kept on improving, which allowed us to go further," he said.
More than 20 years ago, Thais were familiar with "Thung Sawasdee", a brown paper bag with the Thai greeting sawasdee on one side and a checkered pattern on the other.
The bags were popular in Thailand, with some even using them as chess boards.
But this familiarity gradually disappeared when businesses and households were introduced to plastic bags, which are stronger and not easily damaged by water, Mr Wichan said.
Several years later when digital technology rapidly developed, paper faced a new rival as the iPad, the tablet developed by Apple as a mini-computer, hit the market.
Despite changes in people's lifestyles, SCGP continues to manufacture paper. Using wood as a raw material matches the global trend of utilising renewable resources such as biomass to slow the environmental burden imposed by fossil fuel and petroleum industries.
"We struggled for more than 20 years to change the image of the paper business," he said.
The industry was blamed for using large amounts of wood, energy and water, which environmental advocates criticised, said Mr Wichan.
The company grows eucalyptus trees on 200,000 rai of land and cuts some of them every 4-5 years to supply the wood for its paper and pulp manufacturing without deforestation.
"One rai can absorb two tonnes of carbon dioxide a year," he said.
Eucalyptus bark is used as biomass fuel for the paper manufacturing process.
The company also uses a technique that requires less water in addition to adopting artificial intelligence (AI) to save energy.
"AI helps us plan and adjust our steaming process at an appropriate level," said Mr Wichan.
SCGP's latest move makes greater use of eucalyptus wood chips by partnering with Origin Materials, which specialises in making carbon-negative materials, to develop eucalyptus-derived bioplastic on a pilot scale.
Carbon-negative materials are utilised in a process aimed at manufacturing materials while avoiding carbon dioxide emissions.
Bioplastic can be used to make bio-polyethylene terephthalate, or bio-PET. PET, which is derived from petroleum, is used to produce water bottles.
The joint project could lead to the production of bio-monoethylene glycol, or bio-MEG. In the chemicals sector, MEG is used to make polyester resins and textile fibres.
While SCGP has not determined how to commercialise the new plastic material, he said he is interested in using this plastic to make thung gaeng, a transparent plastic bag used to carry hot food.
Mr Wichan said biodegradable plastic should be used to make this type of container or similar products rather than durable goods, which can be recycled.
The company looks forward to more applications of this bioplastic while it continues to develop its paper manufacturing, he said.
"The paper business will never die," said Mr Wichan, suggesting it can grow along with global efforts to better protect the environment.
SCGP set a goal to reduce greenhouse gases as well as promote the company's growth by diversifying into new businesses.
The company plans to achieve a net-zero target, a balance between greenhouse gas emissions and absorption, by 2050, sooner than the goal set by the government.
Thailand made a pledge at the 26th UN Climate Change Conference in Glasgow in 2021 that it would seriously support actions enabling it to reach its net-zero goal by 2065.
Mr Wichan insisted on significant progress for SCGP as it moves towards the 2050 deadline.
The company aims to decrease carbon dioxide emissions by 25% from the 2020 level, he said.
"We already cut emissions by 15%," said Mr Wichan.
One green practice is its recycling business, currently accounting for 6% of revenue for its three core businesses, with packaging comprising 75% and paper and pulp representing 19%.
"We are the largest user of recycled materials for paper production," he said.
The company invested in a factory in Samut Sakhon to make boxes for products such as beer and fish sauce, where up to 99.8% of the raw materials used are recycled, said Mr Wichan.
SCGP is also seeking opportunities to develop businesses through mergers and partnerships, which account for 40% of business expansion, with 60% attributed to organic growth, he said.
The company develops food containers made of renewable materials through a partnership, paving the way for its brand presence in the food industry, said Mr Wichan.
SCGP also supports research on using mai taku as a raw material for making spoons and forks to replace plastic utensils, which may be banned in the future as environmental campaigns intensify, he said.
Known as burflower-tree, mai taku is used to make matches. As matches become dated, the company sees an opportunity to create a new use for the wood, said Mr Wichan.
"This can become a new potential business because mai taku is a soft wood that can be easily shaped into eating utensils," he said.
SCGP aims to earn 160 billion baht this year, up from 146 billion in 2022.
The company continues to focus on its businesses in Asean. It expects the packaging market in this region to grow by 6.1% a year until 2024. The total value is estimated at US$72.7 billion next year, said Mr Wichan.