Shell Chemicals and Braskem Bring Certified Bio-Attributed and Bio-Circular Propylene and Polypropylene to the U.S. Market
Shell Chemicals partners with Braskem to supply bio-attributed and bio-circular propylene for more sustainable plastics production, supporting consumer demand in various markets.
The partnership between Shell Chemicals and Braskem to supply bio-attributed and bio-circular propylene feedstocks represents a significant step towards environmental sustainability in the chemical industry. By transitioning from hydrocarbon feedstock to bio-based alternatives, the companies are actively reducing dependency on fossil fuels and contributing to a circular economy. This shift not only addresses the growing consumer demand for sustainable products but also aligns with global efforts to reduce greenhouse gas emissions.
From an environmental perspective, the use of bio-attributed feedstocks can potentially lower the carbon footprint of polypropylene production. This is because bio-based feedstocks typically derive from renewable resources, such as biomass, which can absorb CO2 during their growth phase. The bio-circular aspect further enhances sustainability by emphasizing the reusability of materials, thus minimizing waste and promoting resource efficiency.
However, the environmental benefits hinge on the lifecycle analysis of these bio-based products. It is crucial to assess the impact from cultivation, processing and transportation of the biomass to ensure that the overall environmental footprint is indeed lower than that of conventional feedstocks. Moreover, the mass balance approach, while allowing for the tracking and allocation of bio-based content in mixed production streams, requires rigorous and transparent certification to maintain credibility and consumer trust.
The strategic collaboration between Shell and Braskem is poised to capture a portion of the market increasingly concerned with sustainability. This move could potentially open up new market segments for both companies, particularly among environmentally conscious consumers and businesses looking to reduce their carbon footprint. As regulatory pressures and consumer preferences shift towards greener alternatives, companies that proactively adapt stand to gain competitive advantages.
The bio-attributed and bio-circular polypropylene produced by Braskem addresses a market trend where packaging, automotive and consumer goods industries are seeking more sustainable materials. This trend is likely to accelerate as stakeholders across the value chain, from suppliers to end-users, prioritize sustainability. The demand for such materials is expected to grow, which could lead to increased market share and potentially higher margins for products perceived as more environmentally friendly.
It is important to note that the scalability of bio-based propylene production and its cost competitiveness with traditional petrochemical products will be key factors in determining the long-term market impact. Companies that can efficiently scale up production and manage costs will be better positioned to capitalize on this trend.
The announcement of Shell supplying bio-attributed and bio-circular propylene to Braskem may have positive implications for the financial performance of both companies. For Shell, diversifying into sustainable chemicals could improve its resilience against volatile oil prices and position the company favorably in a market moving towards decarbonization. Braskem's initiative to produce more sustainable polypropylene could enhance its brand image and potentially lead to premium pricing for its products.
Investors should monitor the operational efficiencies and cost structures associated with the production of bio-based propylene. While the initial investment in developing and certifying these sustainable processes might be substantial, the long-term savings from reduced regulatory risks and alignment with global emission reduction targets could be significant. It is also vital to consider the impact of such initiatives on the companies' ESG (Environmental, Social and Governance) ratings, which are increasingly influencing investment decisions.
However, investors should remain cautious and seek detailed disclosures regarding the production costs, expected return on investment and the projected demand for bio-based polypropylene. These factors will be crucial in assessing the financial viability and impact of this transition on the companies' bottom lines.
03/14/2024 - 08:00 AM
Polypropylene manufactured from bio-attributed and bio-circular propylene will support growing consumer demand for more sustainable plastics
HOUSTON & PHILADELPHIA --(BUSINESS WIRE)--
Shell Chemicals recently started to supply Braskem (BM&FBOVESPA: BRKM3, BRKM5, and BRKM6; NYSE: BAK; LATIBEX: XBRK) with bio-attributed and bio-circular propylene feedstocks, based on a mass balance approach and independently certified by a third party.
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Braskem will utilize bio-attributed and bio-circular propylene feedstocks for the manufacture of bio-attributed and bio-circular polypropylene enabling more sustainable options for growing consumer demand in the packaging, film, automotive, and consumer goods markets. (Photo: Business Wire)
Braskem will utilize such feedstocks for the manufacture of bio-attributed and bio-circular polypropylene enabling more sustainable options for growing consumer demand in the packaging, film, automotive, and consumer goods markets.
Mark Nikolich, Vice President of Olefins and Polyolefins, Braskem North America stated, “Braskem is a leader in the innovation and production of bio-based materials, and we continue to see demand grow for more renewable solutions in our markets. In January 2023, we communicated the evaluation of a Braskem-led project to produce bio-based propylene in the U.S. With today’s announcement, we will continue to focus our work on sources of sustainable propylene, in this case, bio-attributed and bio-circular, to support our polypropylene clients in meeting their carbon reduction and circularity goals. This is possible because of forward-thinking suppliers like Shell. Ultimately, we believe that these different renewable solutions are complementary and important steps forward as the plastics industry evolves to a more sustainable future. We will continue to develop and provide solutions to support our global clients in reaching their sustainability goals.”
Shell is replacing hydrocarbon feedstock with a bio-attributed and bio-circular feedstock in its propylene product, which has the potential to reduce greenhouse gases and contribute to a circular economy.
“Shell is proud to be working with Braskem to supply the bio-attributed and bio-circular feedstocks that go into the everyday products that support modern life. This deal further illustrates how Shell Chemicals is growing its portfolio of sustainable chemicals and, by using bio-attributed and bio-circular feedstocks, Shell is progressing its strategy to lower greenhouse gas emissions from its operations and to be a net-zero emissions energy business by 2050,” said Sean Clarry, Shell Chemicals' Senior Vice President Commercial.
The recent collaboration between Shell and Braskem in Europe , aimed at enhancing the utilization of circular content in Braskem's polypropylene production, reinforces Braskem's commitment to achieving carbon neutrality and advancing its circular economy goals by 2050.
Shell has also set a target to reduce absolute emissions by 50% by 2030, compared to 2016 levels on a net basis. This covers all emissions in Scope 1, which come directly from its operations, and in Scope 2, from the energy Shell buys to run its operations, under its operational control.
Mass balance bio-attributed content to specific end products when produced with a mix of traditional and novel feedstocks. The process is independently verified by a third-party certification body.
ABOUT SHELL CHEMICALS
Shell Chemicals has been helping its customers achieve their business goals for more than 90 years. Its five integrated Energy and Chemical Parks combined with its Chemicals only facilities can reliably provide custom solutions at scale around the world. Develop your solutions together with Shell Chemicals. References to the expressions “Shell,” “Shell’s chemicals business” or “Shell’s chemical plants” refer to multiple companies that are part of the Shell Group that are engaged in chemical or related businesses. For more information, please visit www.shell.com/chemicals .
Shell Chemicals on social media:
https://www.linkedin.com/showcase/shell-chemicals/
ABOUT BRASKEM
With a strategy centered on people and sustainability, Braskem is engaged in contributing to the value chain to strengthen the Circular Economy. Braskem’s 8,000 team members dedicate themselves every day to improving people's lives through sustainable solutions in chemicals and plastics. With its corporate DNA rooted in innovation, Braskem offers a comprehensive portfolio of plastic resins and chemical products for diverse industries, such as food packaging, construction, manufacturing, automotive, agribusiness, health, and hygiene, and more. With 40 industrial units in Brazil , the United States , Mexico , and Germany , Braskem exports its products to clients in over 70 countries.
Braskem America is an indirect wholly owned subsidiary of Braskem S.A. headquartered in Philadelphia . The company is the leading producer of polypropylene in the United States , with five production plants located in Texas, Pennsylvania , and West Virginia , an Innovation and Technology Center in Pittsburgh , and a New Renewable Innovation Center in Lexington, Ma. focused on leveraging groundbreaking developments in biotechnology and advanced materials. For more information, visit www.braskem.com/usa , or to learn more about our products, visit www.braskem.store/products .
Braskem on English social media:
www.facebook.com/BraskemGlobal
www.linkedin.com/company/braskem
FORWARD-LOOKING STATEMENT
This press release contains projections and other forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended) regarding future events. These statements reflect Braskem’s current beliefs and expectations with respect to Braskem’s business, the economy and other future conditions and are based on assumptions, are subject to risk and uncertainties and are subject to change at any time. Actual events or results may differ materially from those contained in such forward-looking statements. Important factors that could cause actual results to differ materially from the forward-looking statements contained herein include, without limitation: (i) the ability of feedstock suppliers to supply feedstock; (ii) the contraction or lack of growth in the market segments in which Braskem competes and in which its products are sold (iii) unexpected delays or other problems in production at Shell or Braskem facilities , (iv) increased competition from imports in the case of Shell or Braskem or in the export markets in the case of Braskem, (v) inability to anticipate future market trends and the future needs of Shell, Braskem or Braskem’s customers, (vi) the impact of natural disasters on Shell’s or Braskem’s facilities and their respective suppliers and (vii) other factors detailed in documents Shell and/or Braskem SA files from time to time with the Securities and Exchange Commission. Forward-looking statements in this release are made pursuant to the safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240312774051/en/
For press information:
stacy.torpey@braskem.com
Source: Braskem
What feedstocks will Shell Chemicals supply to Braskem for polypropylene production?
Shell Chemicals will supply bio-attributed and bio-circular propylene feedstocks to Braskem.
Which markets will benefit from the use of bio-attributed and bio-circular polypropylene?
The packaging, film, automotive, and consumer goods markets will benefit from the more sustainable options provided by Braskem.
What is Shell's strategy regarding greenhouse gas emissions in its operations?
Shell aims to lower greenhouse gas emissions from its operations and become a net-zero emissions energy business by 2050.
How does the mass balance approach work in attributing bio-circular and bio-attributed content to end products?
The mass balance approach enables Shell to attribute bio-circular and bio-attributed content to specific end products when produced with a mix of traditional and novel feedstocks, independently verified by a third-party certification body.
What is Braskem's goal in terms of carbon neutrality and circular economy by 2050?
Braskem aims to achieve carbon neutrality and advance its circular economy goals by 2050.
