Shares in Graft Polymer (UK) PLC (LSE:GPL) rose 13% to 2.6p after it won an R&D contract to focus on wood plastic composites (WPCs), where waste wood is bonded together with a binding agent.
The 12-month contract follows initial work that the London-listed company has been conducting with Mexico-based Empresas Vilher this year.
WPCs make use of waste wood and Empresas Vilher also sees it as an outlet for its plastic recycling work.
Graft chief executive Victor Bolduev said the two companies are working on projects together that are hoped will lead to firm supply orders for the company's newly commissioned manufacturing facility.