Happiness Moon, a supplier of disposable foodservice items and machinery located in the United States, has formed a joint venture with Karat Packaging, a US-based packaging firm.
Green Earth Technology, a company in which Karat would own a 49 percent stake, will be established as part of the agreement between the parties.
Green Earth will assist in the development of a facility in Taiwan that will cover 180,000 square feet.
In order to make biodegradable foodservice goods utilising bagasse, a byproduct of sugar cane pulp, the facility will be outfitted with sophisticated robotic automation developed by Happiness Moon and installed at the site.
The factory, which is scheduled to begin manufacturing in the second part of this year, is estimated to generate around 7,560t of goods by the end of the following year.
Take-out boxes, plates, bowls, tableware, and other bagasse-based goods will be among the products available.
Karat will keep around half of the factory’s production for its own clients, with the remaining half going to other customers in Asia and Europe, according to the company.
The facility will receive an initial investment of around $6 million from the corporation.
Chief executive officer of Karat Packaging Alan Yu said: “Our investment demonstrates Karat’s commitment and leadership position in providing eco-friendly disposable foodservice products.
“Most bagasse products in the United States are currently imported from China. The joint venture will enhance Karat’s vertical integration in its supply chain and accelerate growth and margin expansion.
“Our objective in the next several years is to become the leading manufacturer of bagasse foodservice products for the US market.”
Yu added: “After thoroughly assessing the technology and robotic capability in Taiwan, which we believe will enhance efficiencies and productivity, we plan to bring the proprietary manufacturing processes to the US and build a first-of-its-kind bagasse production plant.
“Expanding the use of environmentally friendly, compostable products, which have a lower carbon footprint, represents a critical step to help businesses and consumers transition toward sustainable living.
“Karat’s unique complementary operating platform of supplier network and manufacturing enables us to provide customers broader product offerings and customisation, with shorter lead times.”