Market Insight:
Bioplastics are plastics made from renewable biomass sources such as plant fats and oils, maize starch, straw, woodchips, sawdust, and recovered food waste. Bioplastics are plastic materials that are either bio-based, biodegradable, or have both properties.
While global plastic production has decreased, the market for bioplastics has expanded. Furthermore, rising demand for bioplastics in the medical sector, technological advancements, and increased R&D would drive market growth. The global bioplastics market is expected to reach US$10.61 billion by 2023, growing at a CAGR of 14.21% over the projected period.
Segment Covered:
Geographic Coverage:
According to this report, the global bioplastics market can be divided into four regions: Asia Pacific, Europe, North America, and the Rest of the World. The countries covered in North America region are the US, Canada, and Mexico, while Europe includes the UK, Germany, France, UK, and Rest of Europe. Moreover, China, Japan, India, and Rest of Asia Pacific are included in the Asia Pacific region.
Asia Pacific held the largest share in the market and over the years, the Asia Pacific bioplastics market has grown at a fast pace due to the increasing demand from the packaging industry, coupled with favorable government regulations. In terms of value and production capacity, China held the highest share in the market owing to the high per capita consumption, increasing consumer preference for bio-based products over synthetic products, and increase in government initiatives. Germany is one of the major economies in Europe, and the bioplastics market has grown at the fastest rate in the country. Germany already supports the use of certified bio-based and compostable bio waste plastic bags for the collection of bio waste in the Bio waste Ordinance. Since 2015, a separate collection of bio waste is mandatory in Germany. The Government of Canada continues to encourage alternatives to plastic waste. They are working towards eliminating the unnecessary use of single-use plastics in government operations, meetings, and events, and purchasing more sustainable plastic products that can be reused, repaired, or repurposed.
Top Impacting Factors:
Growth Drivers
Challenges
Trends
Driver: Increasing Fossil Fuel Prices
The bioplastics industry experienced a boom as fossil fuel-based virgin plastics face sharp price rises and material shortages due to COVID-19 disruptions, economic inflation, and political conflict. With fossil fuel prices being at historic highs, bioplastics became economically more attractive. The bioplastics industry relies more on renewable plant-based resources rather than on fossil fuels. The bioplastic industry, therefore, supports the stability of prices by disconnecting from the price of oil and gas and also supports a much greater cause of removing one’s dependency on depleting resources with a significant environmental and human health toll. The increase in fossil fuel prices is, therefore, increasing the demand for the bioplastics market.
The market for bioplastics has been associated with high costs. It is difficult to persuade plastic manufacturers to convert to bioplastic for their products and packaging without financial incentives because bioplastic is more costly to produce than conventional plastic. Due to expensive raw ingredients, sustainable products are frequently more expensive than traditional products. To create a product with a minimal environmental effect, certain premium raw ingredients are required. Considering that they are produced in lower quantities, these raw materials are more expensive. Currently, bioplastics are more than twice as expensive as traditional plastics made from petroleum. This is mostly caused by the expensive R&D, building a polymer factory, and raw material costs when the production scale is still small. Hence, these factors may restrain the growth of the market.
Bio-plastics are rapidly growing in popularity, and many new techniques and approaches are emerging as a result of intensive research and development (R&D) activities. The research and development activities are tightly focused on tackling the intrinsic synthesis of bioplastics that currently keeps costs high and limits performance. Several bioplastic materials (polylactide, polyhydroxyalkanoates, and starch) have been successfully converted into food packaging using conventional plastic conversion technologies including extrusion, injection molding, and compression molding. Recently, bioplastic packaging has been developed into active packaging which can either control the release of active ingredients or scavenge undesirable substances. Hence, the research and development in bioplastics is increasing, which, in turn, is anticipated to increase the bioplastics market.
The COVID-19 Analysis:
In 2020, global bioplastics have experienced negative growth. Numerous multinational corporations made commitments to use biodegradable plastics in response to consumer and activist pressure before the COVID-19 pandemic. However, after the COVID-19 outbreak, the regulations on single-use plastics and green investments announced by many governments and organizations got postponed due to the pandemic, resulting in a reduction in the uptake of bio-based alternatives. However, as the lockdown eased, the market witnessed significant growth. Moreover, as people become more aware of the expanding plastic waste stream and its effects on the environment, the private and public sectors are anticipated to invest more funding to speed up the use of bioplastics.
Analysis of Key Players:
The global bioplastics market is consolidated. The key players in the global bioplastics market are:
Some of the strategies among key players in the market are mergers, acquisitions, and collaborations. For instance, in 2022, Avantium N.V. announced that the company’s business unit Avantium Catalysis would expand the company’s business to focus increasingly on R&D solutions for sustainable chemistry. On the other hand, Toray Industries, Inc., announced that the company has developed a polyethylene terephthalate (PET) film that combines excellent applicability and adhesion for water-based and solvent-free coatings and can eliminate solvent-derived carbon-dioxide emissions. In the global bioplastics market, TEIJIN Limited held the major share of the market, followed by BASF SE and SABIC.