CJ CheilJedang CEO Choi Eun-seok (left) and LG Chem CEO Shin Hak-cheol shake hands at a signing ceremony held at LG Chem's headquarters in Seoul, Wednesday. (LG Chem)

LG Chem announced Thursday that the company will work together with food giant CJ CheilJedang to produce bio-based nylon, an eco-friendly alternative to traditional synthetic polymers.

LG Chem said the two companies signed a heads of agreement on Wednesday to establish a joint venture that will produce ingredients and bio-based nylon products.

“It has not been determined yet, but the two companies are expected to establish the joint company as early as this year,” an official familiar with the matter said on the condition of anonymity.

Under their partnership, CJ CheilJedang will provide LG Chem with pentamethylenediamine, the main ingredient for bio-based nylon products.

CJ CheilJedang is capable of producing PMDA using lysine made from corn and sugarcane. The company has been producing lysine for monogastric diets at several plants across the world, according to the company.

With the ingredients provided from CJ CheilJedang, LG Chem plans to make bio-based nylon products at its facilities. Whether the joint venture will build a new factory for bio-based nylon products, however, has not yet been decided. “The company could build a new factory or modify existing plants,” an official from LG Chem said.

LG Chem and CJ CheilJedang’s bio-based nylon products will be supplied to companies in a wide range of industries seeking to shift away from using nylon products derived from fossil fuels. “More companies will use bio-based nylon products to reduce their carbon emissions,” LG Chem said.

According to LG Chem, global demand for bio-based nylon products is expected to grow to 1.4 million tons in 2028 from 400,000 tons in 2023, at a 29 percent compound growth rate.

LG Chem expects companies that produce automotive interior trim components, clothes and home appliances to use bio-based nylon products. “The company is also already in discussions with both local and global companies to supply our bio-based nylon products in the future,” the official from LG Chem said.

Meanwhile, LG Chem said the latest initiative to enter the nylon industry came as LG Chem's CEO Shin Hak-cheol pushes ahead with the company’s three new growth engines: batteries, eco-friendly materials and new globally innovative drugs.

“The latest partnership is meaningful in that the two companies agreed to work together to shift to a low-carbon economy. LG Chem will continue to pursue a plastics business using eco-friendly, low-carbon raw materials to establish itself as a company that demonstrates leadership in carbon reduction,” Shin said.