The output volume of lactic acid was 0.2 mln tons in China in 2013 while the market size was CNY 1.7 bln. The global production capacity of PLA is expected to increase from over 0.2 mln tons in 2012 to 0.8 mln tons in 2020 while that in Asia will exceed 0.35 mln tons, accounting for nearly 50% of the total, as per MarketnMarkets.com. In Chinese lactic acid industry, only a few enterprises, such as COFCO Biochemical (Anhui) Co., Ltd., Henan Jindan Lactic Acid Technology Co., Ltd. and Hebei Xinhua Limited Company, can reach the annual production capacity of tens of thousands of tons. Most enterprises have small scales and the annual production capacity of hundreds to thousands of tons. Many enterprises have announced plans of new projects with large scales. A sound industry chain system is formed in Chinese lactic acid industry. In terms of the constitution of upstream and downstream industries, lactic acid manufacture industry is the extension of raw material industry. The development of high end industry chain from raw materials to products is partially realized. In China, upstream raw material for lactic acid is corn starch while downstream includes food, medicine, cosmetic and agricultural product industry. As the application areas of lactic acid and its derivatives expand and the consumption increases, demand for lactic acid keeps increasing in China. Lactic acid is also widely used as pH modifying agent in beer. Demand for lactic acid continues to increase in food industry. Industries with the largest consumption of lactic acid are food and beverages with average annual growth rate of 10%, including condiments, liquor and milk. Industrial application areas are leather manufacture, microelectronics, electroplating industry and PLA production. The output volume of lactic acid in Asia is the largest, accounting for 40% of the global output volume. Major production regions of lactic acid are the USA, Western Europe, Japan and China while nearly 80% of the manufacturers adopt zymotechnics in production. The production capacity of lactic acid is concentrated in North America, Asia and Europe.

Many Asian countries issue policies to support development of various biobased materials while Asia produces a large amount of agricultural raw materials, which both promote the development of PLA. However, demand for PLA remains low in Asia, which indicates that most of the new production capacity is for export. Many domestic manufacturers of PLA expand the production capacity as market demand increases in China in recent years. Although the output volume of polylactic acid was less than 20,000 tons in China in 2013, the production capacity and output volume were increasing with major manufacturers like Zhejiang Hisun Biomaterials Co., Ltd. and Nantong Jiuding Biological Engineering Co., Ltd. It is predicted that the consumption of lactic acid in the production of polylactic acid will increase in the next few years. Moreover, increase in downstream demand for polylactic acid promotes the development of lactic acid market in China. The demand in food and beverage market also stimulates growth in lactic acid industry. In the U.S., lactic acid is mainly used as acidulant while the demand in instant meat industry continues to grow. The demand for lactic acid remains stable in food and beverage industry in Western Europe and Japan. The demand for lactic acid in food and beverage market in China and other emerging countries will increase promptly. Polylactic acid is transformed from lactic acid. It can transform industrial plastic products, food packaging and nonwoven cloth to civil products, which can be further processed into various textiles and sanitary products. The market possesses huge potential for growth. Similar to the membrane made from polystyrene, polylactic acid provides fine gloss and transparency which other biodegradable products cannot provide.