Research that could lead to a bioplastics plant being built in Marton, potentially creating hundreds of jobs, has received a $380,000 boost from the Government's Provincial Growth Fund (PGF).
On Tuesday Regional Economic Development Minister Shane Jones announced funding for research that could lead to New Zealand's first commercial bioplastics facility being established.
The funding will be used to research whether radiata pine could be used in developing a biodegradable alternative to single-use plastics, with the aim of developing a high-tech bioplastics pilot plant alongside new timber processing facilities in Marton.
The facility would be developed by NZ Bio Forestry, a new entity that aims to increase productivity in the forestry sector and build a bio economy. The OECD has estimated the potential contribution of a thriving bio economy to New Zealand's GDP at up to US$124 billion in 2030.
NZ Bio Forestry Ltd chief executive Wayne Mulligan said New Zealand was well-placed, given the availability of natural resources, to respond to growing consumer demand for alternatives to petroleum-based plastics through the development of bioplastics.
"It's estimated that there are millions of tonnes of forest residue in New Zealand that are currently under-utilised," Mulligan said.
In the first stage of the project, NZ Bio Forestry and its Taiwan-based research and technology partners plan to build a pilot plant at Marton, initially creating up to 200 jobs including high-tech roles.
It would produce polymers from residual forestry biomass, such as waste material from timber processing, which can be used to make a range of bioplastic products such as containers, packaging and food service items. Unlike petroleum-based plastics, the products would be fully biodegradable and compostable, and made from a renewable forestry resource.
The technology is already in use in Taiwan to produce biofuels and bioplastics for commercial use.
The pilot plant is expected to be fully operational by early 2022 and the company intends to increase to full production in Marton before expanding to other regional sites.
Rangitikei mayor Andy Watson said the initiative reflected the commitment of all of the councils in the central North Island region to work together on sustainable economic growth.
"The Bio Forestry initiative positions the region to be at the forefront of what will be a growth industry for New Zealand as the world looks for more sustainable solutions," Watson said.
"Our region has the resources, the workforce and, through our partnership with NZ Bio Forestry Ltd, access to the technology."
The project would link to the planned regional rail hub and regional freight ring road in Palmerston North.
The flow of logs for timber processing and use of residual waste for producing bio-plastics would be critical to the success of the project.