U.A.E. Company Produces Mideast’s First Plant-Based Bottles

(Bloomberg) -- A Middle Eastern drinking-water company is producing the region’s first bottles made entirely from fermented plant sugars.

Agthia Group, which markets the Al Ain brand of drinking water, plans to distribute its first shipment of water in the biodegradable containers within a few months, Chief Executive Officer Tariq Ahmed Al Wahedi said in an interview. The Abu Dhabi-based company is in talks with potential buyers across the United Arab Emirates including hotels, restaurants and government agencies, he said.

Agthia makes the new bottles from corn sugars, which it processes into a resin and molds like plastic. It fashions the bottle caps from fermented sugar cane. The plant-based materials can decompose in as little as 80 days, Al Wahedi said in Dubai, the second-biggest emirate in the U.A.E. after Abu Dhabi.

The company is experimenting with these alternatives to plastic even as the U.A.E. and other oil and gas producers expand into manufacturing petrochemicals -- the building blocks for plastics. Governments in the region see producing petrochemicals as a way of squeezing more profit from crude and gas while limiting their exposure to the price volatility of fossil fuels.

Benchmark Brent crude has dropped about 13% this year, after gaining 23% in 2019, as the coronavirus weighs on demand. OPEC and its allies have reduced oil production and will meet next month to consider extending the output cuts beyond March.

However, the plant-based bottles are costlier to make than plastic ones, Al Wahedi said, without giving details. The new bottles also have a shorter shelf life.

Agthia currently sells 50 million cases, or about 1 billion liters (264,000 gallons), of water a year. All of them could use plant-based bottles if there is enough demand and resin available, he said. The company wants to produce 5% of its bottles from plant-based sources by 2021, though it isn’t marketing them to the general public because they require special handling for collection and decomposition.

To contact the reporter on this story: Verity Ratcliffe in Dubai at vratcliffe1@bloomberg.net

To contact the editors responsible for this story: Nayla Razzouk at nrazzouk2@bloomberg.net, Bruce Stanley, Helen Robertson

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