Spuds Steal the Plastics Market

Potatoes have replaced plastic in the disposable tableware market.

By Melanie Haiken, Business 2.0 Magazine

(Business 2.0 Magazine) -- Start saying goodbye to Styrofoam containers and plastic cutlery. Since these polystyrene products are nonrecyclable and nonbiodegradable (unlike other plastics), West Coast cities are voting them out of existence.

Portland, Oakland, and Santa Monica had bans in place by January. San Francisco will clamp down on June 1, and Seattle is mulling a prohibition. Those laws affect not only the industry that ships roughly 39 billion pieces of plastic cutlery a year, but restaurants, conference centers, and corporate cafeterias too.

On the flip side, they mean a big opportunity for makers and distributors of bioplastics. Tableware derived from corn and sugar is already taking off, thanks to backing from giants like DuPont (Charts) and Dow Chemical (Charts).

But the most innovative bioplastic cutlery is SpudWare, made from potato starch and soybean oil, which is more heat-resistant than its rivals. (See "Earth-Friendly Tableware," above.) Manufactured in China, SpudWare cutlery was named and is distributed by Excellent Packaging & Supply, a three-year-old company in Richmond, Calif.

EPS is already profitable, with revenue of about $5 million. "We've grown 40 percent a year for the past two years," says EPS co-founder Allen King. "And all of our growth is from green products."

Earth-friendly tableware:

1. Potato Starch (SpudWare)

Pro: Sturdy and heat-resistant to 302 degrees

Con: Costs more

2. Sugarcane Pulp (BagasseWare)

Pro: Cheapest, microwavable, fully compostable

Con: Softens when wet

3. Corn Resin (NatureWorks)

Pro: Made in United States, wide distribution

Con: Heat-resistant to only 150 degrees Top of page

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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.