Plastics and Advanced Materials Industry Review Q3-2008; McGladrey Capital Markets

Key Trends

Concerns Regarding Bisphenol A

The use of Bisphenol A (BPA) in consumer products is generating varied opinion from industry groups. BPA is used in a variety of products such as shatter-resistant polycarbonate plastic baby bottles and epoxy resin lining in food cans for safety of food from contaminants. Scientific and government bodies around the world have reaffirmed the safety of food-contact products containing BPA. The California Assembly recently rejected a bill that targeted the use of BPA in food contact products for use by children under the age of three.

Mixed Reactions on Plastic Bags Ban

As mentioned in last quarter's review, the ban on plastic bags continues to receive increased attention from all quarters of the industry. Several cities have banned the use of plastic bags outright, whereas others have voiced their opinion against a ban. Manhattan Beach, Calif., with 35,000 residents, became the third U.S. city with a ban on plastic carryout bags. A ban in San Francisco went into effect in November 2007, and a ban in Malibu, Calif., approved in May 2008, goes into effect in two stages, beginning in December. Most recently, Westport, Conn., passed a ban on plastic bags earlier this month that will go into effect in March 2009. Although some cities are getting vocal against the use of plastic bags, legislators in California failed to pass a plastic-bag tax in the recently completed legislative session. The bill required retailers to charge at least 25 cents for plastic bags, starting in July 2011, if they do not achieve a 70 percent bag diversion rate based on use reduction and recycling rates. A series of recommendations from the Ocean Protection Council in California could lead to more bans and taxes on plastics packaging. The report calls for producer responsibility for the take-back of packaging waste, and bans or fees on commonly littered items such as plastic bags and polystyrene containers.

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