Compostable Plastic Market size is set to grow by USD 2.88 billion from 2024-2028, Growing use of compostable packaging boost the market, Technavio

NEW YORK, July 24, 2024 /PRNewswire/ -- The global compostable plastic market size is estimated to grow by USD 2.88 billion from 2024-2028, according to Technavio. The market is estimated to grow at a CAGR of 19.16% during the forecast period. Growing use of compostable packaging is driving market growth, with a trend towards growing government initiatives encouraging replacement of conventional plastics with compostable plastics. However, high costs of compostable plastics compared with conventional plastics poses a challenge. Key market players include BASF SE, BEWI ASA, Biome Technologies plc, BioTec Bags India Pvt. Ltd., BOSK Bioproducts, Cargill Inc., Danimer Scientific Inc., Eastman Chemical Co., Fkur Kunststoff GmbH, Futerro SA, Green Dot Bioplastics Inc., Kaneka Corp., KURARAY Co. Ltd., Mitsubishi Chemical Corp., Neste Corp., Northern Technologies International Corp., Novamont S.p.A., SK Chemicals Co. Ltd., Toray Industries Inc., TotalEnergies SE, and Trinseo PLC.

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Market Driver

The global plastic crisis is escalating due to the significant increase in plastic consumption, particularly in the packaging industry. Plastics account for over one-third of all global plastic consumption and contribute to approximately 85% of marine litter, with this percentage projected to nearly triple by 2040. The environmental and health consequences of plastic use are becoming increasingly apparent, leading governments to take action. For instance, the European Union's Single-Use Plastics Directive (SUPD) prohibits certain single-use plastic items and mandates increased recycled content in beverage bottles. India's Plastic Waste Management Rules aim to ban single-use plastics with low utility and high littering potential. These regulations, among others, are driving the demand for eco-friendly alternatives, such as compostable plastics. Given the growing awareness and stringent regulations, the compostable plastic market is poised for growth. The market is expected to expand as businesses and consumers seek sustainable alternatives to traditional plastics. This trend is expected to continue during the forecast period, making compostable plastics a promising solution to the plastic crisis. 

The compostable plastic market is on the rise, driven by trends in biodegradable plastics and the need for more sustainable solutions. Municipal waste management is a key area of focus, with governments worldwide promoting initiatives for biobased products. Polylactic acid (PLA) and starch bags are popular choices, adhering to the BS N13432 standard. Sugarcane feedstock and renewable feedstocks are increasingly used, replacing traditional polymers and petrochemical counterparts. Biodegradable plastics find applications in various sectors like electronics, medical devices, implants, and temporary implants, contributing to surgeries and drug delivery systems. Construction materials, insulation, and compostable packaging for restaurants, grocery shops, and e-commerce industries are also growing niches. Consumer awareness and environmental concerns are driving demand for compostable plastic bags, containers, silverware, and other products. Ethical waste management and environmentally friendly packaging are becoming essential for businesses to stay competitive. Plastic pollution reduction is a priority, making compostable plastics an attractive alternative to conventional plastics. 

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Market Challenges

• The compostable plastic market faces several challenges, primarily due to the higher production costs compared to conventional plastics. The high polymerization cost is a significant factor, as most compostable plastic production processes are still in the development stage and have not reached economies of scale. Additionally, the lack of a well-established supply chain network at upcoming capacity locations poses a challenge. The technology for producing compostable plastics is unconvincing due to its nascent stage, with various raw materials being tested for optimal production. Currently, compostable plastic costs between USD2.65 and USD6.68 per kilogram, whereas conventional plastic costs USD1.65 per kilogram. Vendors' high research and development costs, substantial differences in the price of conventional petroleum-based plastics and bioplastics, and the smaller production scale contribute to the low demand for bioplastics. Traditional plastics have become more affordable due to the larger price disparity and the declining price of crude oil. Technical barriers to lowering the cost of compostable plastics exist, and feedstocks account for a significant portion of the price. The industry is transitioning to bio-based feedstocks, but about one-third of biodegradable plastics are still made from petrochemicals. Agricultural products such as corn, potatoes, and cassava continue to dominate the current bio-based feedstock market, which may hinder the growth of the global compostable plastic market during the forecast period.
• The compostable plastic market is growing as businesses seek eco-friendly alternatives to traditional petrochemical plastics. However, challenges persist in the form of bio-based materials not always living up to their compostable claims and the durability and shelf life concerns. Green procurement policies in various sectors like electronics, medical, and construction are driving demand for compostable plastics in niche products. However, plastic waste from industries like healthcare, particularly from medical devices, implants, and temporary implants, presents a significant challenge. Consumer awareness and environmental concerns are on the rise, leading to increased demand for compostable plastic packaging in restaurants, grocery shops, and e-commerce industries. Companies must address carbon footprint concerns through ethical waste management and material technology advancements. Bioplastics offer a solution, but their labeling and consumer education are crucial for success. Homecare and healthcare sectors also present opportunities for sustainable packaging solutions.

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Segment Overview 

This compostable plastic market report extensively covers market segmentation by  

1. End-user 
• 1.1 Packaging
• 1.2 Consumer goods
• 1.3 Textiles
• 1.4 Agriculture
• 1.5 Others
2. Product 
• 2.1 Compostable bag
• 2.2 Compostable cutlery
• 2.3 Compostable gloves
• 2.4 Compostable straw
• 2.5 Others
3. Geography 
• 3.1 Europe
• 3.2 North America
• 3.3 APAC
• 3.4 South America
• 3.5 Middle East and Africa

1.1 Packaging-  The compostable plastic market is primarily driven by the packaging industry, particularly in applications such as bottles, cups, pots, and films. Two main types of compostable packaging, rigid and flexible, are commonly used in the food, cosmetics, and material packaging sectors. Brands like Heinz, Coca-Cola, and Volvic utilize bio-PET for bottle packaging, while Proctor and Gamble and Johnson and Johnson use bio-PE for cosmetics. Polylactic acids (PLA) are also gaining popularity in rigid packaging. The e-commerce industry, which dominates the packaging sector, is a significant driver of demand for compostable plastics due to the increasing global online sales. In 2020, online sales grew by 32.4% compared to the previous year. India, China, the US, and Japan, leading markets in the food service industry, require large quantities of food packaging materials due to their growing populations. The global population was 7.8 billion as of July 2020, and this rising population will continue to drive demand for food packaging materials and, consequently, compostable plastics from the food service industry segment.

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Learn and explore more about Technavio's in-depth research reports

The global Biodegradable Medical Plastics Market is witnessing robust growth, driven by increasing environmental concerns and advancements in medical technology. The global Bioplastics Market is also expanding rapidly, supported by growing consumer preference for sustainable products. Meanwhile, the global Biodegradable Paper Market is experiencing a surge in demand, fueled by stringent regulations on plastic use and a shift towards eco-friendly packaging solutions. Together, these markets represent significant opportunities for innovation and investment, addressing the global need for sustainable and biodegradable alternatives.

Research Analysis

The Compostable Plastics market is witnessing significant growth due to the increasing demand for eco-friendly and sustainable alternatives to conventional plastics. Biodegradable plastics made from plant-based materials, such as polylactic acid (PLA) derived from sugarcane feedstock, starch bags, and other biobased products, are gaining popularity. The BS N13432 standard ensures the compostability of these products. Traditional polymers and petrochemical counterparts are being replaced by these bio-based materials in various sectors like municipal waste management, electronics, medical, and consumer goods. Governmental initiatives and green procurement policies are driving the market forward. Compostable plastic packaging, containers, silverware, and bags are widely used in restaurants and other foodservice industries due to rising environmental awareness and consumer demand for environmentally friendly alternatives. However, the extraction and refining processes of these materials need further optimization to reduce costs and increase efficiency. Despite these challenges, the market is expected to continue growing as more industries adopt compostable plastics to address environmental concerns and meet consumer expectations.

Market Research Overview

The Compostable Plastics market is experiencing significant growth due to increasing municipal waste and governmental initiatives towards sustainable waste management. Biodegradable plastics, made from renewable feedstocks like plant-based materials and biobased products, are gaining popularity as eco-friendly alternatives to traditional polymers. These include Polylactic Acid (PLA) and starch bags, which meet the BS N13432 standard for compostability. Sugarcane feedstock and corn starch are common raw materials used in the production of compostable plastics through extraction and refining processes. The market spans various sectors such as electronics, medical, construction, and packaging. Biodegradable plastics find applications in medical devices, implants, temporary implants, surgeries, and biodegradable sutures, drug delivery systems, and insulation materials. The market also caters to niche products like compostable plastic packaging, silverware, bags, and containers used in restaurants and grocery shops. Rising environmental awareness and ethical waste management practices are driving the demand for compostable plastics in various industries. The e-commerce industry and online shopping are also adopting compostable packaging, shipping materials, and mailing bags to reduce their carbon footprint. The durability and shelf life of compostable plastics are comparable to their petrochemical counterparts, making them a viable alternative for various applications. Consumer education and labeling are crucial for the growth of the market, ensuring transparency and trust in the use of compostable plastics. Homecare and healthcare sectors are also adopting sustainable packaging solutions to reduce plastic waste and contribute to a more eco-friendly future.

Table of Contents:

1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation

• End-user
• Packaging
• Consumer Goods
• Textiles
• Agriculture
• Others
• Product
• Compostable Bag
• Compostable Cutlery
• Compostable Gloves
• Compostable Straw
• Others
• Geography
• Europe
• North America
• APAC
• South America
• Middle East And Africa

7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Trends
10 Company Landscape
11 Company Analysis
12 Appendix

About Technavio

Technavio is a leading global technology research and advisory company. Their research and analysis focuses on emerging market trends and provides actionable insights to help businesses identify market opportunities and develop effective strategies to optimize their market positions.

With over 500 specialized analysts, Technavio's report library consists of more than 17,000 reports and counting, covering 800 technologies, spanning across 50 countries. Their client base consists of enterprises of all sizes, including more than 100 Fortune 500 companies. This growing client base relies on Technavio's comprehensive coverage, extensive research, and actionable market insights to identify opportunities in existing and potential markets and assess their competitive positions within changing market scenarios.

Contacts

Technavio Research
Jesse Maida
Media & Marketing Executive
US: +1 844 364 1100
UK: +44 203 893 3200
Email: [email protected]
Website: www.technavio.com/

SOURCE Technavio

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