Biodegradable Plastics Market by Material Type (Starch Blends, PLA, PBAT, PBS, and Others), Application (Packaging & Bags, Consumer Durables, Agriculture & Horticulture, Textiles, and Others), and Regional Analysis (North America, Europe, Asia-Pacific, and LAMEA): Global Opportunity Analysis and Industry Forecast, 2021 –2028

Global Biodegradable Plastics Market Analysis

According to the global biodegradable plastics market forecast, the market is expected to reach up to $8,940.5 million by 2028, surging from $4,276.9 million in 2020 at a noteworthy CAGR of 9.5%.

Market Synopsis

Rising utilization of bio-based products in packaging and agriculture applications is estimated to fuel the biodegradable plastics market growth.

However, the higher cost of the products is a restricting factor for the market growth.

Based on regional investigation of the market, the Asia-Pacific biodegradable plastics market is anticipated to grow at a CAGR of 9.3% CAGR by generating a revenue of $4,133.1 million in the review time.

Biodegradable Plastics Overview

Biodegradation is process that can convert a material partially or completely into CO2, water, and biomass through the reaction of microorganisms like bacteria and fungi. Biodegradable or compostable plastic are the materials degraded by living organisms especially microbes into CO2 or methane, biomass, and water under specific conditions. Biodegradable plastics are generally manufactured with petrochemicals, micro-organisms, and renewable raw materials. Due their environmentally friendly nature, biodegradable plastics are widely used in several applications especially packaging.

COVID-19 Impact on Biodegradable Plastics Market

The COVID-19 pandemic had a negative impact on the global biodegradable plastics manufacturing owing to disturbance of supply chains and production services globally. Also, during the pandemic, millions of people discarded single use plastic materials such as gloves, masks, sanitizer bottles and aprons and created huge plastic waste. This aspect has increased the utilization for biodegradable plastics in PPE (personal protective equipment) and other similar products. Also, some of the major leaders in the market are continuously taking several initiatives such as partnerships and joint ventures to strengthen their presence in the overall industry. For instance, in November 2020, Danimer Scientific, a leading biotechnology company, and Eagle Beverage, a beverage manufacturer, produced biodegradable drinking straws for quick service restaurants. Eagle Beverage will produce the straws by Danimer Scientific’s biopolymer technology with Nodax PHA and the straws are predicted to be available for Eagle Beverage customers from 2021. Through this initiative, both the companies aim to create awareness about the benefits of biodegradable products and enhance customer base. Due to such company developments, the biodegradable plastics market trends is expected to witness positive growth after coronavirus pandemic.

Wide Utilization of Biodegradable Plastics in Packaging Application are Estimated to Drive the Market

Rising utilization of biodegradable plastics majorly in food packaging is a major driver for the growth of the market in the forecast period. This growth is majorly owing to biodegradable polyesters being the best alternatives to plastics. Thus, rise in usage of food packaging, bottles, and disposable tableware and government support for biodegradable materials with strict regulations on plastics usage to minimize environmental pollution are factors expected to enhance the market growth in the forecast time. For example, in 2020, Germany government announced a ban on the sale of single use plastic products such as cutlery, straws, food containers and other similar products from July 2021 to minimize plastic waste across the country. According to The German Association of Local Utilities estimates, every year there is rise of common plastic items waste by 10% to 20%, which is majorly from single use plastic products. Also, the government is taking initiatives to create awareness about biodegradable items and supporting the manufacturers to deliver high quality products. Such factors are estimated to impel the biodegradable plastics market Growth, in the analysis period.

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High Production Cost is Expected to Restrain the Market Growth

Higher cost of the biodegradable plastic products due to high raw material cost as well as limited availability of raw materials is estimated to be major restraints for the biodegradable plastics market growth, in the forecast time.

Rising Incorporation of New Technologies to Create Growth Prospects

Constant incorporation of new technologies in biodegradable plastics manufacturing is estimated to create ample invest opportunities for the market in the future years. For example, there has been incorporation of antimicrobial technology in biodegradable materials manufacturing to develop materials with longer shelf life and to extend preservation of the packaged products especially food items. Also, antimicrobial packaging is used to prevent deterioration and ensure microbiological & chemical food safety by averting microbial growth.

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Source: Research Dive Analysis

The starch blends sub-segment generated a major market share in 2020, is estimated to account for $3,054.7 million by 2028, and anticipated to grow at a noteworthy rate of 9.0% CAGR during the analysis period. Starch blends can be utilized to minimize the carbon footprint of conventional resigns because it is the best alternative for petroleum-based polymers, which is estimated to foster market growth in the review time.

The PLA sub-segment is anticipated to have profitable growth and is estimated to reach a revenue of $2,122.0 million by 2028, with a CAGR of 10.4%. Growing utilization of PLA for several applications like packaging and agriculture due to it being made of renewable raw materials and producing less greenhouse gases compared with traditional plastics. Such aspects are estimated to propel the market growth in the forecast time.

Source: Research Dive Analysis

The packaging & bags sub-segment of the global biodegradable plastics market accounted for evident market size of over $2,410.4 million in 2020 and is expected to garner $5,171.8 million by 2028, with a notable CAGR of 9.8% during the analysis time. There is wide utilization of biodegradable plastics for packaging application. In addition, novel product introduction may also create positive impact on the subsegment. For example, EnviGreen, an Indian innovative startup firm manufactures edible and 100% biodegradable plastic bags. An ‘EnviGreen bags’ have capability to break down completely in the 15 seconds if placed in the boiling water. Also, continuous utilization of biodegradable plastics for packaging of several products like foods and other similar products due its eco-friendly nature is estimated raise the market size in the review time.

Source: Research Dive Analysis

The Market for Biodegradable Plastics in Asia-Pacific to be the Most Dominant

The Asia-Pacific biodegradable plastics market accounted $2,003.8 million in 2020 and is further projected to surpass $4,133.1 million by the year 2026. This dominance is majorly accredited to strong economic growth for biodegradable plastics usage in packaging sector and growing consumer positive outlook towards its utilization to minimize plastic pollution. Growing economies like China and India have implemented severe regulations on conventional plastics utilization and major manufacturers in these countries are introducing sustainable packaging solutions like bio-based products, which is estimated to drive the market growth in the review time.

The Market for Biodegradable Plastics in Europe to be the Fastest Growing

The share of Europe biodegradable plastics market is anticipated to grow at a notable CAGR of 10.8%, and the market estimated to account for $2,563.2 million by the end of 2028. Strong regulations implemented by the European Union on fossil fuel-based plastics to reduce carbon footprint in the environment are estimated to propel the market growth in the review time.

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Competitive Scenario in the Global Biodegradable Plastics Market

Product launches and mergers & acquisitions are the most common strategies followed by the leading players in the market.

Source: Research Dive Analysis

The key global biodegradable plastics market players are Eastman Chemical Company, TORAY INDUSTRIES, INC., Dow, Biome Technologies plc, Novamont SpA, Danimer Scientific, Mitsubishi Chemical Holdings Corporation, Total Corbion and BASF SE.

Porter’s Five Forces Analysis for Biodegradable Plastics Market:

• Bargaining Power of Suppliers: Biodegradable plastics market has a high number of suppliers. Further, growing demand for eco friendly plastic bags and accessibility of replacements are delivering the bargaining power of suppliers to be moderate.
• Bargaining Power of Consumers: Biodegradable plastics market has a huge number of customers and product dependence is expected to be high. But, high cost of the products, users still using low-cost conventional plastic products.
  These aspects are generating moderate negotiation power of consumers. 
• Threat of New Entrants: The market needs high investments for the developing of cost-effective bio-based products but, high brand dependence among the customers is a high risk factor for the new entrants.
  These aspects resulting moderate for the new entrants into the industry. 
• Threat of Substitution: Huge availability of the alternatives for the bio-based products like highly commercialized conventional plastics are resulting a high risk of substitutes.
• Competitiveness in the industry: Biodegradable plastics industry contains a huge number of major industry players. These participants are concentrating on new product launches to rise their market share in the global industry.
  Thereby, the competition in the market is high.