Packaging Industry Demand for Biodegradable Plastics to Increase Massively, reports TMR

A larger of companies in the global market for biodegradable plastics are concentrated in North America and Europe. In 2014, BASF SE, Corbin, and Nature Works LLC had collectively accrued a share of approximately 33% of the total market volume.

As per a research report titled “Biodegradable Plastics Market – Global Industry Analysis, Size, Share, Growth, Trends and Forecast 2015 – 2023”,recently published by Transparency Market Re-search, a collective segment of electronics, medical, and others are expected to take up focus from key biodegradable plastics manufacturers around the world.

The degree of competition is expected to remain moderate over the coming years due to the high price sensitivity of raw materials and production process, along with the diverse pricing strategies adopted by prominent players. The global market for biodegradable plastics is expected to expand at a very optimistic CAGR of 9.9% within a forecast period from 2015 to 2023, in terms of revenue. This revenue is projected to reach US$9.10 bn by the end of 2016 and US$17.66 bn by the end of 2023.

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Starch-based biodegradable plastics are expected to overtake polylactic acid-based biodegradable plastics, which is currently the dominant product segment in the global market. By the end of 2023, starch-based biodegradable plastics as a product segment is expected to reach US$6.36 bn, owing to a growing use in the industries of medical, textiles, and packaging. A massive proportion of biode-gradable plastics is taken up in packaging processes globally. By the end of 2023, and estimated US$10.59 bn is expected to be generated from the application of biodegradable plastics in packag-ing.

Europe Continues to Lead Consumption of Biodegradable Plastics

By the end of 2023, Europe is expected to have garnered a revenue of US$6.08 bn in revenue from biodegradable plastics. The governing bodies of this region are putting a lot of pressure on the use of biodegradable materials wherever possible to control the overwhelming amount of garbage that can-not naturally decompose. These regulations are expected to bolster the stand of biodegradable plas-tics manufacturers in the region, further boosted by government support and incentives. A similar effect is visible in North America, while Asia Pacific is yet to make a significant demand for biode-gradable plastics owing to its high production cost.

Government Support for Biodegradable Plastics Allows Players to Take Great Leaps

“The governments are playing a huge role in the promotion of biodegradable plastics manufacturers today. On one hand they are introducing stringent regulations regarding the use of plastics and their disposal, while on the other hand they are providing financial assistance to many prominent market players for biodegradable plastics,” states a TMR analyst.

Initiatives such as the directive taken by the European Parliament in 2015 pertaining to the growing use of lightweight plastic carrier bags, and the ban by the U.S. on plastic checkout bags in retail stores have added substantial weightage to the biodegradable plastics movement, thus improving the revenue generation of its manufacturers.

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High Cost of Biodegradable Plastics Deters Large-scale Use

Owing to several factors such as the volatile prices of raw materials and the complexity of their manufacturing process, biodegradable plastics are slow in being picked up by several key emerging economies. The manufacture of biodegradable plastics requires optimal conditions and the precise amount of microorganisms, while additionally requiring skilled labor. This deters several countries from adopting biodegradable plastics on a wider scale.

“Researchers are working on the manufacturing of biodegradable plastics from bio-based materials. This could be the future of this market, as it can help remove the price volatility of the current raw materials that are derived from petrochemical products,” adds the analyst.

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