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The North America and Europe bioplastics market size was USD 5,178.9 million in 2020. The impact of COVID-19 has been unprecedented and staggering, with bioplastics witnessing a negative demand shock across North America and Europe amid the pandemic. Based on our analysis, North American and European market exhibited a decline of 5.91% in 2020 as compared to the average year-on-year growth during 2017-2019. The market is projected to grow from USD 5,579.7 million in 2021 to USD 11,321.8 million in 2028 at a CAGR of 10.6% during the 2021-2028 period. The sudden rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.
Bioplastics are derived from renewable sources such as cellulose, plant starch, natural sugars, vegetable fats, and waste oils. The majority of these plastics are biodegradable, and hence, are superior to conventional plastics. As a substitute for fossil-based plastics, the use of bioplastics is encouraged in various end-use industries, including packaging, textile, electronics, automotive, and furniture. Stringent laws on the use of single-use plastics imposed by various governments and associations in North America and Europe have shifted plastic producers towards the development of bio-based plastics for different applications. The growing demand for renewable packaging products from food and consumer goods industries is driving the North America and Europe market.
Supply Chain of Bioplastics was Severely Impacted due to the Spread of Coronavirus
Coronavirus affected the production and transportation of bioplastics and their raw materials, resulting in supply chain disruptions. Biomass-producing companies lowered their production volumes owing to the restrictions on manpower and material availability. In addition, the prices of conventional plastics reduced owing to the lower crude oil prices. Furthermore, rules and regulations on single-use plastics announced by various governments were postponed due to the pandemic, thereby resulting in the reduced use of bio-based products. However, the demand for sustainable plastics from the medical and food industries is offering growth opportunities to the market during COVID-19.
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Increase in Demand from Textile Industry to Create Growth Prospects
Bioplastics are increasingly preferred in home textiles, the clothing and footwear industry. Bioplastics add quality to the product and improve its design and functionality. Poncho, a type of raincoat manufactured by Equilicua, a Spanish company, is an excellent example of bioplastic-based protective clothing that is 100% compostable and biodegradable. Another example of application is in sport socks and luggage made of Rilsan (Polyamide 11) produced by Arkema. Thus, the superior properties of bio-based plastics are expected to raise their demand from textile industry and create growth opportunities for companies operating in the market.
Rising Demand for Sustainable Plastic Packaging Products to Drive Market
Bioplastics find the most prominent application in the packaging industry as they offer similar properties to traditional plastics. The packaging industry is expanding at a substantial rate, owing to an increase in the demand from food, automotive components, electronics, and consumer goods industries. Furthermore, the demand for packaging products has increased significantly to safeguard valuable products from possible harm caused by environmental aspects such as heat and moisture. With the increasing e-commerce activities across the globe, a large number of packaging products are expected to be used in the near future.
Plastic material is vital for the packaging industry as it offers significant properties, including stiffness, rigidity, transparency or opacity, and durability, for the manufacturing of packaging products. Bio-based plastics are manufactured from renewable feedstock, and hence, they can be used as an excellent sustainable alternative to minimize the plastic waste generated in the environment.
Higher Cost of Bioplastics as Compared to Traditional Plastics to Hinder Market Growth
Most of the bioplastics require high-temperature industrial composting plants to disintegrate, and only a few companies have developed the infrastructure required to process them. As a result, bioplastics end up in landfills, releasing methane when there is less oxygen available for disintegration. Additionally, these plastics need to be disposed of properly, as they might pollute the feedstock chain of recycled plastics. Hence, separate disposal streams are required to properly remove bioplastics from the environment, thus leading to a high infrastructure cost.
Besides, bio-based plastics compete with food as the feedstock crops for its production are mainly used as food across the globe. According to the Plastic Pollution Coalition, to serve the present global demand for bioplastics, 13800 sq. km. of land is required to harvest feedstock crops. These key factors make it costlier than traditional plastics.
Biodegradable Segment to Hold Larger Market Share during the Forecast Period
Based on the type, the market is bifurcated into biodegradable and non-biodegradable. The biodegradable type holds a larger market share owing to its high adoption in packaging, automotive, agriculture, and textiles industries. Polylactic acid (PLA) accounts for highest share amongst the biodegradable types due to its heavy consumption in the packaging industry.
On the other hand, the non-biodegradable segment is expected to grow at a slower rate owing to its comparatively lower sustainable nature. These plastics have higher rigidity and strength in comparison to biodegradables, which enables them to serve as an attractive material for applications in rigid packaging products, electronic body components, and automotive parts. Bio-based non-biodegradable plastics include bio-polyethylene, bio-polypropylene, and others. The increasing adoption of pouches, storage bags, packaging films, automotive fuel tanks, and tubes is expected to drive the demand for bio-polyethylene (bio-PE) during the forecast period. The rising demand for the manufacturing of bottles, caps, food containers, straws, pots, boxes, and packaging films will surge the bio-polypropylene (bio-PP) market in North America and Europe.
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Rigid Packaging Segment to Register a Higher CAGR during the Review Period
The market is categorized into rigid packaging, flexible packaging, and others, on the basis of application. Among these, the rigid packaging segment is expected to register higher growth in this market. This growth is attributed to the rising adoption of sustainable and strong packaging products by shipping companies. The rigid packaging segment is further fragmented into bottles & jars, trays, and others. Increasing demand for beverage and pharmaceutical liquids packaging is expected to drive the bottles & jars sub-segment.
The rising consumption of pouches, films and bags for the packaging of various food and non-food products will provide various growth opportunities to the flexible packaging segment in North America and Europe. The flexible packaging segment is further divided into pouches, shopping/waste bags, and others. The rising use of consumer goods and ready-to-eat food products will surge the demand for pouches during the forecast period.
The others segment includes textiles, automotive & transportation, agriculture & horticulture, and consumer goods applications. An increase in the demand for sustainable plastics from these applications is anticipated to surge the North America and European market during the forecast period.
In 2020, the European bioplastics market size was valued at USD 3,460.8 million. It is the foremost region in the innovation, and consumption of bio-based plastics. According to European Bioplastics, Europe accounted for nearly 25% of production in 2019. The growing automotive industry and increasing usage of bio-based packaging are driving the market in this region. The decision taken by the European Union to reduce waste generation by lowering the usage of single-use plastics shall result in the growing demand for biodegradable bioplastics in this region.
North America is expected to register significant growth in the market owing to the expansion of food and retail packaging industries in the U.S., Canada, and Mexico. The increasing sales in the retail sector have led to the high demand for bio-based packaging products in the region. Additionally, improvement in the foodservice sector has presented a huge demand for bioplastic trays and bottles in the region.
Capacity Expansion is the Key Strategy for the Growth of Companies Operating in the Market
Capacity expansion is the key strategy adopted by companies operating in the North America and Europe bioplastics market. In addition, collaborations, partnerships, acquisitions, and new product developments are some of the other growth strategies used by manufacturing companies. These strategies have enabled them to maintain their leading positions in the market. Total Corbion PLA bv, Novamont S.p.A., Arkema S.A., and NatureWorks LLC are few prominent companies in the market. In September 2020, Total Corbion PLA announced its plan to build a second polylactic acid plant with a capacity of 100 kilotons, and in October 2019, Novamont started the expansion of the production of Mater-Bi by 36% to reach the capacity of 150 kilotons.
An Infographic Representation of North America and Europe Bioplastics Market
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The North America and Europe bioplastics market report offers a detailed analysis of the market and focuses on key aspects such as competitive landscape, types, and applications. Also, it provides insights into market trends, dynamics and highlights vital industry developments. In addition to the factors mentioned above, the report encompasses various factors that have contributed to the growth of the market over recent years.
Value (USD Million) and Volume (Kiloton)
By Type, Application and Geography
Fortune Business Insights says that the market size was USD 5,178.9 million in 2020 and is projected to reach USD 11,321.8 million by 2028.
In 2020, the market value stood at USD 5,178.9 million.
Registering a noteworthy CAGR of 10.6%, the market will exhibit significant growth in the forecast period (2021-2028).
By type, the biodegradable segment is expected to lead this market during the forecast period.
The increasing demand for sustainable plastics packaging products is the key factor driving the market.
Novamont, Arkema S.A., and LyondellBasell are the leading players in this market.
Germany held the highest share in the North America and Europe market in 2020.
Concerns regarding the accumulation of waste in the environment and stringent regulations on the usage of single-use plastics are the key factors driving the adoption of these products.
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