Biodegradable Plastics Market Size, Share Global Analysis Report, 2022 – 2028

Industry Insights

[235+ Pages Report]  According to the report published by Facts & Factors, The global biodegradable plastics market size was worth around USD 7.69 billion in 2021 and is predicted to grow to around USD 31.39 billion by 2028 with a compound annual growth rate (CAGR) of roughly 22.25% between 2022 and 2028. The report analyzes the global biodegradable plastics market’s drivers, restraints/challenges, and the effect they have on the demands during the projection period. In addition, the report explores emerging opportunities in the global biodegradable plastics market.

Market Overview

Biodegradable plastic is a plant-based plastic that has no negative environmental consequences. In a reasonable amount of time, it degrades spontaneously in base compounds. As a result, biodegradable plastic is composed of molecules that can degrade spontaneously through the activity of microorganisms. Polylactic Acid) (PLA), Polybutylene adipate terephthalate (PBAT), Polybutylene Succinate (PBS), Polyhydroxyalkanoates (PHA), and starch blends are some of the most common biodegradable plastics. The growth of the market for biodegradable plastics from a variety of end-use sectors, severe regulatory & sustainability regulations, and rising environmental concerns are projected to boost the biodegradable plastics market growth.

The rising use of PHA in medical and other applications is likely to drive market expansion in the PHA segment. PHA is mostly employed in pharmaceutical encapsulation and medical implants. Tissue engineering, bone marrow scaffolds, and bone plates are some of the other medical applications. Aside from medicinal applications, PHA is also utilized in the manufacture of compost bags, agricultural foil & films, and packaging for food, drinks, & consumer products. These factors are predicted to promote the global growth of PHA.

Key Insights

• As per the analysis shared by our research analyst, the global biodegradable plastics market is estimated to grow annually at a CAGR of around 22.25% over the forecast period (2022-2028).
•  In terms of revenue, the global biodegradable plastics market size was valued at around USD 7.69 billion in 2021 and is predicted to grow to around USD 31.39 billion by 2028. Due to a variety of driving factors, the market is predicted to rise at a significant rate.
• Based on type segmentation, starch blend was predicted to show maximum market share in the year 2021
• Based on end-user segmentation, the packaging was predicted to show maximum market share in the year 2021
• On the basis of region, Europe was the leading revenue generator in 2021.

Covid-19 Impact

Numerous industries, including consumer goods, packaging, textiles, agriculture, and horticulture, use biodegradable polymers. However, Covid-19 had an impact on these industries all over the world. From 2019 to 2020 the industry's expansion has been constrained by logistical challenges, a labor shortage, a lack of materials, and other issues. Additionally, the global impact has caused a precipitous drop in demand for packaging, which is decried as unnecessary. While the demand for e-commerce shipments that fall under the category of necessary packaging increased significantly. The package converters are facing a new set of issues as a result of these changes. These factors will also cause the impact of the Covid-19 epidemic on the packaging sector to be uneven.

The pandemic has interfered with businesses in the consumer goods industry's regular manufacturing. According to the Institute for Supply Management Research, supply chain interruptions caused approximately 75% of organizations to lower their revenue targets. The consumer sector is experiencing a mixed economy as some industries, such as frozen foods and domestic cleaning, have seen an increase in consumer demand while others have seen sales dip and significant drops in foot traffic in stores. These businesses have to adapt to the shift in consumer demand toward e-commerce. The whole consumer products sector has thus been compelled into the digital age.

Growth Drivers

• Shifting consumer preference toward biodegradable plastic to drive market growth

The market for biodegradable plastics is anticipated to expand as a result of increased initiatives to limit the usage of conventional plastics and rising consumer awareness of eco-friendly plastic alternatives. Plastics made traditionally from petroleum degrade slowly over many years and end up in landfills. Biodegradable polymers degrade swiftly and are reincorporated into the environment. Additionally, compared to conventional plastics, biodegradable plastics decompose more quickly. Compared to standard plastics, which take over 1,000 years to degrade, biodegradable polymers degrade 60% faster and in as little as 180 days.

Rising garbage accumulations and landfills have become significant environmental risks and have a number of negative effects on the ecosystem's flora and fauna. The usage of biodegradable plastics is being encouraged by growing consumer knowledge of these impacts (caused by the use of regular plastics). As a result, the market for biodegradable plastics is being driven by a change in customer preference toward the use of eco-friendly plastic items.

Restraints

• Price of biodegradable plastics is slightly on the expensive side compared to conventional plastics

The global biodegradable plastics market's expansion in many application areas is hampered by biodegradable plastics' higher pricing compared to those of conventional polymers. Biodegradable plastics often cost 20–80% more to produce than conventional plastics. This is because such polymers have a high cost of polymerization and are still in the development stage, which prevents them from being commercially viable.

For instance, biodegradable plastics like PHA have many uses in synthetic papers, binders, medical equipment, food packaging, electronic parts, and agriculture, all of which have high production costs, a limited supply, and poor yields. Although PLA polymers are more affordable than PHA, they are still more expensive than PP and PE made from petroleum. In comparison to its petrochemical alternative, which has been developing quickly for more than 50 years, bio-based raw materials are generally still in the development stage and have not yet been marketed. In contrast to traditional plastics, which typically cost between USD 1/kg and USD 2/kg, the cost of biodegradable plastics ranges from USD 2/kg to USD 6/kg. The main reasons for the low adoption of biodegradable plastics across many industries are higher production and R&D expenditures due to small-scale production and the significant price fluctuation in contrast to conventional petroleum-based plastics.

Opportunity

• Development of new applications to bring up market growth opportunities

Biodegradable plastic producers have tremendous growth potential in the various end-use industries, including electronics, automotive, and medical, thanks to favorable government regulations and an increasing focus on eco-friendly polymers for green procurement strategies. Converters of biodegradable plastics are heavily investing in R&D efforts for environmentally friendly plastics in a variety of biomedical applications, including screws, stitching materials, and implants. Manufacturing of biomedical devices and equipment uses biodegradable plastics such as PLA, PCL, PGA, and bio-PBS. Tires made of starch-based raw materials and biodegradable polymers are used in the automotive sector to cut down on fuel usage. Additionally, the production of electrical equipment is made more productively and economically using bioplastics. During the projection period, the application for packaging is also anticipated to have a substantial increase.

Additionally, biodegradable plastics used in mulch films have a wide range of uses in the agricultural sector. Trays, cutlery, and cups made of biodegradable plastic are utilized in the food packaging sector. Initially, biodegradable plastics are only used in a small number of niche items, but as new uses for these materials are discovered, their manufacturers are seeing profitable expansion potential.

Challenges

• Performance issues likely to challenge the market expansion

Some of the major performance difficulties with biodegradable polymers are low heat resistance and poor water, air, and oxygen barrier qualities. This resulted in penetration limitations in a number of industries, including the automotive and electronics sectors. Furthermore, biodegradable plastics are not being used in many applications due to their poor mechanical qualities, including low tensile and impact strength. These biodegradable plastics' drawbacks provide a serious obstacle to the market's expansion.

Segmentation Analysis

The global biodegradable plastics market is segmented based on product type, end-user, and region.

On the basis of type, the market has been segmented into PLA, starch blends, PHA, and biodegradable polyesters. Due to its widespread use in a range of industries, such as packaging, automobiles, and agriculture, the starch blends segment led the global market for biodegradable plastics. Plastics for PLA products are also quickly gaining ground on the market. A significant industry driver is PLA's low cost as compared to other products.

On the basis of end-user, the market has been segmented into packaging, consumer goods, textile, and agriculture & horticulture. Because of the movement in consumer choice from artificial to bio-based products in response to increased environmental consciousness, the packaging segment dominated the global market for biodegradable plastics. Biodegradable plastic is used in many different applications and has the potential to be useful in food packaging. The need for biodegradable plastic in packaging applications is directly impacted by the rise in packaged food options as a result of demographic and lifestyle changes.

Recent Developments:

• In April 2021, a new strategic alliance between NatureWorks and IMA Coffee, a market leader in coffee handling, processing, and packaging, was announced. Through this agreement, high-performing biodegradable K-cups will have a wider market reach in North America.
• In February 2020, a joint venture between BASF and the Italian company Fabbri Group was established to provide a sustainable replacement for the cling film used in fresh food packaging. The film will be used to package fresh fruits, vegetables, and meat. The Fabbri group will produce it using Ecovio bioplastic from BASF, which will increase the demand for biodegradable polymers in packaging applications.

Report Scope

Regional Analysis

• Europe to lead the market growth during the projection period

In 2021, the biodegradable plastics market in Europe was the largest regional market. The European Union's prohibition on single-use plastics and the general high awareness of plastic waste are expected to drive the regional market throughout the forecast period. On the other hand, Asia Pacific is anticipated to become the region with the quickest rate of growth worldwide. The region's market is expected to grow as a result of rising disposable income and rising living standards in developing nations like China and India.

In the market, Central and South America also showed promise as a travel destination. The availability of inexpensive raw materials should bode well for the local market. Due to the increased demand for bio-based packaging in the food and consumer products industries, the U.S. market is anticipated to grow significantly over the projected period. Compared to conventional plastics, bio bags and bio-based plastics are more convenient to use, have better tensile strength, and are environmentally beneficial. As a result, it is anticipated that during the projection period, demand for biodegradable plastics would increase.

Competitive Analysis

• Cargill Incorporated 
• PTT MCC Biochem Co. Ltd. 
• Biome Technologies plc 
• Plantic Technologies Limited 
• BASF SE 
• Total Corbion PLA 
• Synbra Technology BV 
• Futerro 
• Novamont SpA 
• NatureWorks LLC 
• Eastman Chemical Company 
• Trineso 
• Danimer Scientific 
• FKuR Kunststoff GmbH.

The global biodegradable plastics market is segmented as follows:

By Type

• Starch Based
• PLA
• PBS
• PBAT
• PHA
• Polycaprolactone

By End Use

• Packaging
• Consumer Goods
• Textile
• Agriculture & Horticulture

By Regional Segment Analysis

• North America
  • The U.S.
  • Canada
  • Mexico
• Europe
  • France
  • The UK
  • Spain
  • Germany
  • Italy
  • Nordic Countries
    • Denmark
    • Sweden
    • Norway
  • Benelux Union
    • Belgium
    • The Netherlands
    • Luxembourg
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • Australia
  • South Korea
  • Southeast Asia
    • Indonesia
    • Thailand
    • Malaysia
    • Singapore
    • Rest of Southeast Asia
  • Rest of Asia Pacific
• The Middle East & Africa
  • Saudi Arabia
  • UAE
  • Egypt
  • South Africa
  • Rest of the Middle East & Africa
• Latin America
  • Brazil
  • Argentina
  • Rest of Latin America