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Global production of bioplastics estimated to grow by 400% in 2016

Global production of bioplastics estimated to grow by 400% in 2016

28-Mar-14

The current global production capacity of bioplastics, including both biodegradable and bio-based plastics, is about 1.5 mln tons, which supposes a total revenue of about Euro 4,400 mln. A significant growth of the bioplastic market is expected in the next few years. Some sources estimate an increase of the global production capacity by 400%, reaching values of about 5.8 mln tons in 2016. In terms of revenue, this market would reach more than Euro 13,700 mln, as per Miguel A. Sibila, researcher of the Department of Sustainability and Industrial Valorisation of AIMPLAS in jeccomposites.com. This growth is mainly due to two factors: their high technical substitution potential compared to conventional materials and their environmental benefits. From an environmental point of view, bioplastics are an attractive and sustainable alternative to conventional materials. On the one hand, the use of natural raw materials reduce both the dependence on fossil fuels and the greenhouse gases emissions to the atmosphere at the end of life (30-80% depending on the material and application). On the other hand, biodegradable plastics can be jointly managed at the end of life with other organic waste.
Although bioplastics are found in a wide range of market segments like packaging, agriculture, construction, automotive; packaging and transport & automotive currently lead consumption in the bioplastics market. In 2011, global bioplastic production capacity for packaging and technical applications (including the transport & automotive segment) amounted to around 810,000 tons and 104,000 tons, respectively. Non-biodegradable plastics from renewable raw materials, also known as durables, are currently leading the bioplastic market. According to some sources, the current global production capacity of these materials is about 930,000 tons, compared to the estimated 543,000 tons of biodegradable plastics. In addition, a strong growth of both durables and biodegradable plastics is expected in the upcoming years, reaching a global production capacity of about 5 mln tons of durables and 0.78 mln tons of biodegradable plastics in 2016. Despite bioplastics market is emerging, there are still some aspects that bioplastics industry shall deal with to overcome their limitations. From a structural point of view, biodegradable plastics show certain limitations in terms of physical, chemical and mechanical properties. On the other hand, its current production capacity is significantly lower than production capacity of conventional plastics, which reduces its substitution potential and increases the price of the final product. In some cases, this final price is they are considerably lower than those for conventional plastics. Nowadays, a large number of research projects are being developed in order to overcome the limitations of these materials. These projects are aimed at improvement of mechanical properties by using synthetic fibres, improvement of barrier materials, enhancement of multifunctional properties, development of high added value products in the Automotive and Consumer Electronic segments and increase of the renewable content of the final product.

As per Research and Markets, the global bioplastics industry is expected to witness significant growth and reach an estimated US$7.02 bln by 2018. The major forces that are driving bioplastics market are high consumer acceptance, danger posed by climate change, increasing price of fossil materials and dependence on fossil resources. The wide variety of bioplastics applications under development is a positive factor for growth of bioplastics which also helps to capture market share from competing materials; huge potential lies within the fields of consumer electronics and automotive. On account of new technological developments, bioplastics are moving out of the niche and entering the mass market. Although full market penetration is just beginning, as materials and products multiply continuously. Multinational brand owners such as PepsiCo and Tetra Pak (packaging) and Ford, Mercedes, Volkswagen and Toyota (automotive) have launched or integrated bioplastic products.
Some of the major challenges likely to be faced by the industry- Bioplastics are generally two to three times more expensive than the conventional plastics. Currently, bioplastic resins cost at least twice as much as petro plastic resins. Price considerations will be the primary determinant for the success of this market. It is expected that rising petroleum costs will allow some bioplastic resins to be able to achieve price parity with conventional plastics. As crops are used for bioplastic manufacturing, use of hazardous chemicals such as pesticides in land for agriculture production is much common in practice. The use of arable land and edible crops to produce bioplastics is increasingly perceived as an undesirable development that could increase food prices and contribute to food shortages. Life cycle analysis demonstrates that bioplastics can reduce CO2 emissions by 30-70% as compared to conventional plastics. This shows a significant reduction in hazardous waste that is caused by oil-derived plastics. Global business is now turning to bio-plastics as governments demand cleaner alternatives to petroleum-based technologies and their reckless emission of greenhouse gas CO2. One metric ton of bioplastics generates between 0.8 and 3.2 fewer metric tons of carbon dioxide as compared to one metric ton of petroleum-based plastics.

Global biopolymers consumption is estimated to be worth 1,446,316.8 tons by 2018, as per Markets and Markets. North America is the world's largest market of biopolymers, which consumed more than one-third of the total demand. US is the key consumer of biopolymers in North America. Packaging, bottling, fibers and automotive are the application segments driving the demand for PLA, bio-PE, and bio-PET which in turn is pushing the demand for biopolymers within the region. The growing concern for human health and safety in the region has also led to increased consumption of biopolymers. The biopolymers market is also up surging due to high penetration of material in industries like packaging and automotive which have further helped the biopolymers market to emerge in the region. Various innovations, developments and expansions in different industries have in turn made the region a potential growth market for biopolymers and its products. Bio-PE is manufactured through fermentation followed by polymerization. Bio-PE is mainly consumed in applications like packaging and automotive. PHA is the fastest growing biopolymers with a CAGR of 27.7% to 2018. The major growth driver for biopolymers is its biodegradability which will have a high impact on the industry in future as well. The biopolymers packaging market has a wide scope for its expansion which in turn would help in increasing the consumption of biopolymers. Bio-PE remains the dominant biopolymer and is expected to be the largest in the future. Packaging is the biggest application of biopolymers and is anticipated to be worth US$1722.7 mln by 2018. Braskem S.A. (Brazil), NatureWorks LLC (U.S), and Indorama Ventures Public Co. Ltd. (Thailand) are some of the major manufacturers of biopolymers.

Ceresana has forecast revenues generated on the global market for bioplastics to reach almost US$6 bln in 2021 to increase by 18.9% pa. The improved properties of modern bioplastics allow for an increasing substitution of conventional plastics. Technological progress and a rapid expansion of production capacities enable manufacturers to reduce prices and to continue to increase the competitiveness of bioplastics. A large potential still remains untapped nonetheless: Many processors and consumers are still expressing doubts regarding the performance and processability of "green" plastics. Processors of plastics and innovative companies around the world, however, are trying to improve their image by emphasizing environmental protection and sustainability. Global market for bioplastics is forecast to triple revenues by 2021. Europe currently accounts for more than one third of total global bioplastics consumption. According to Ceresana, this will continue to be the case for several years to come, not least because Europe is leading in the research and development of bioplastics. However, Asia-Pacific and South America in particular are catching up significantly. They possess a wealth of biological resources and growing sales markets, and have governments that promote bioplastics. The trend moves towards so called "Drop In" bioplastics such as bio-polyethylene or bio-PET; their properties are similar to those of their fossil equivalents, and, like those, they are not biodegradable either. These developments are backed by large enterprises in the segments foodstuff, consumer goods, and the automotive industry that intend to reduce their ecological footprint by using easy to recycle bioplastics. Biodegradable plastics are utilized in all applications where they help to reduce disposal costs: Packaging that decomposes alongside leftover food, agricultural films that simply can be plowed in or flower pots and trays for seedlings.

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