The most important conventional polymers used in packaging are low density and high density polyethylene (LDPE and HDPE), polyethylene terephthalate (PET) and polyvinyl chloride (PVC), according to Lux. So far, plant-based PVC has not yet been introduced, but bio-PE and bio-PET are starting to make an impact. ICIS says that out of all biopolymers, bio-based polyethylene is in the most advanced stage of commercialization. While bio-plastics represent only 1% of the total plastics market today, NanoMarkets' report projects that amount will grow to 7% by 2020. Market drivers include recyclability of bio-based PA, PE and PET and the bio-degradability/compostability of other bioplastics. The sector will benefit from European and Japanese mandates favoring compostable/recyclable materials, along with the involvement of big names such as BASF and Dow Chemical, who are investing heavily into bioplastics.

To reach full potential, bioplastics require to come down in price from the current levels of almost two-to-three times the price of conventional plastics. This sector is also highly capital intensive - Every 1 mln ton of bio-plastics production capacity, requires investment of at least US$1.25 billion currently. Cost reductions will be achieved through economies of scale and by using less expensive options for feedstocks. Another factor that will help bioplastics� growth will be an impetus towards improvements in properties and ongoing technical improvements such as better barrier coatings. The consumption of bioplastics by the packaging industry will amount to 1.3 bln tons in 2013; almost 75% of bioplastics shipped, as per NanoMarkets. Packaging will still hold a 65% share of the bio-plastics market as late as 2020. For plastic bottles, bio-PET is expected to replace fossil-based plastics entirely and PLA foamed structures are expected to take a noticeable share of the food container segment. The other big bioplastics opportunity lies in the automotive segment, which is expected to consume just 75 mln tons of bioplastics in 2013 but more than 10 times that amount in 2018. Bridgestone and Cooper Tire are developing bioplastic tires - bio-based butadiene tires will be retailing by 2014. Mitsubishi is doing R&D work on bioplastics for automotive interior parts. Bioplastics that are expected to be used in the automotive segment include PLA blends, bio-PA, bio-PE, and bio-PET. Bioplastics' product is shifting to Asia and South America, closer to where feedstocks are grown. By 2020 nearly 80% of bioplastics will be produced in these regions. Chinese companies are already making bio-plastics and firms such as Arkema and BASF are investing in the Chinese bioplastic sector. Chinese domestic consumption for bio-plastics will also grow rapidly, but will be constrained by Chinese government concerns with using food crops for feedstocks.

The Asia-Pacific biorenewable materials market is estimated to grow at a rate of over 19% pa till 2018, as application development and technology licensing costs come down, and customer awareness grows. With biorenewable materials likely to replace common plastics in various packaging applications, the large replacement demand presents the market in the region with added growth opportunities. A study by Frost & Sullivan on Biorenewable materials market finds that the market earned revenues of US$46.8 mln in 2011 and estimates this to reach US$167 mln in 2018. The region's plastic packaging market, which comprises of both rigid and flexible packaging, accounts for over 1,200 kilo tpa of plastics. It is expected to grow rapidly, boosting the demand for bioplastics particularly in flexible packaging applications. PLA is likely to experience the highest growth rate, owing to substantial capacity additions locally. Rising oil prices have increased the price parity between bioplastics and fossil fuel-based plastics, which are used on a large scale in the packaging industry. This closing gap in price difference further enhances the prospects of the bioplastics market. Moreover, the use of bio-based plastics offers several potential benefits, including reduced dependence on fossil fuels and lower greenhouse gas emissions during manufacturing. Taking advantage of this, brand owners are eager to switch to bio-based plastic packaging that highlights their environmental responsibility and appeals to the green consciousness of customers. However, several factors can hold back the potential of biorenewable materials in Asia Pacific. Prices remain high, since application and technology development is an ongoing process. The low scale-up of manufacturing capacity also increase per unit costs. In addition, bioplastics' inferior performance attributes, such as moisture absorption, low heat deflection temperature, and reduced resistance against chemical attacks, limit their application range. The poor execution of eco-labeling policies and insufficient composting facilities in Asia-Pacific countries also restrict the potential applications of bioplastics. For the time being, bioplastics are playing a limited role in packaging and in the plastics market overall. However, manufacturers are sure to keep their eye on plant-based materials as a means to increase the sustainability of the value chain. Meantime, bioplastics manufacturers would do well to seek out applications at margins where their product can provide �good enough� performance at lower cost, or environmental benefits at equal cost or at a premium. This can provide a wedge into the market while producers expand capacity and improve their products through intensive R&D. As per Frost & Sullivan, to stimulate growth, manufacturers must innovate technology, develop better products, and scale-up capacity to bring per unit costs down. To encourage companies to enter the market, local governments should introduce codification for composting and biodegradability, and implement national standard certifications. This will enable the bioplastics market in Asia-Pacific to attract investments and grow steadily.