The global biodegradable packaging materials market is estimated at USD 88 Billion in 2022 and is forecast to surpass USD 169 Billion by 2032, growing at a CAGR of 6.8% from 2022 to 2032.
The global biodegradable packaging materials market accounts for ~9% of global packaging market in 2022 and is expected to expand due to augmented consumer spending on sustainable biodegradable packaging materials because of enhanced environment-consciousness. The global biodegradable packaging materials market is projected to have an absolute $ opportunity of USD 81 Billion during the assessment period of 2022-2032.
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A majority of regulatory bodies and international environmental organizations have proposed a ban on single-use packaging materials to mitigate the perilous effects of non-degradable solid waste on the environment. Increasing environmental awareness and consumer inclination towards making sustainable purchases is providing a major boost to the growth of the biodegradable packaging material market.
Positive effects of the ban on single-use packaging on the biodegradable packaging material market are offset by stringent labeling regulations and certification procedures to control false claims about the biodegradability of packaging materials. The biodegradable packaging material market is characterized by the needs to comply with strict quality standards established in various regional markets, which may complicate it for market players to maintain competitive prices of biodegradable packaging solutions.
The Fact.MR report finds that leading players in the biodegradable packaging material market are adopting strategies to acquire their smaller rivals to consolidate a stronger position in the packaging sector. DS Smith plc – a British paper packaging company – recently announced its plans to acquire its Spanish rival Europac Group for over US$ 2 billion, in order to consolidate the Western European biodegradable packaging material market. Another leading player in the biodegradable packaging material market – Smurfit Kappa Group recently completed the acquisition of Reparenco – a paper and recycling company in Netherlands – for €460 million to expand its European biodegradable packaging capacities.
WestRock Company, an American manufacturer of biodegradable packaging, recently acquired packaging businesses across the world, including Hanna Group Pty Ltd, Plymouth Packaging, Inc., and Schlüter Print Pharma Packaging GmbH, to establish a stronger presence in the biodegradable packaging material market. The company also revealed its plans to acquire KapStone Paper and Packaging Corp., an American paper company, for a total enterprise value of around US$ 4.9 billion to leverage KapStone’s expertise in biodegradable packaging using kraft paper.
“Increasing growth of the e-commerce sector and popular trends of online grocery shopping is opening new avenues of growth for players in the biodegradable packaging material market. Purchasing decisions of environment-conscious consumers are greatly influenced by sustainable packaging materials, which may create high demand for biodegradable packaging solutions in the coming future. Stakeholders in the biodegradable packaging material market are shifting their focus on the dynamic trends in the e-commerce sector while adopting their future business strategies,“ says a lead analyst at Fact.MR.
The Fact.MR report further states that, among all the leading end-user industries in the biodegradable packaging material market, food & beverage industry is expected to account for more than 30% of the total market share throughout the forecast period. Increasing demand for packaged food products, convenience foods, and ready-to-eat meals is reflected in supermarket shelves. Leading players in the biodegradable packaging material market are introducing biodegradable packaging films, trays, and bags to further improve the fresh food experience for consumers while offering numerous environmental benefits.
The European Union and the Bio-based Industries Consortium have established a €3.7 billion partnership, which is known as Bio-based industries Joint Undertaking (BBI JU) to boost adoption of biodegradable packaging as a part of its Horizon 2020 project. The BBI JU recently offered around € 5.6 million to fund The FRESH project by Huhtamaki Group in the Netherlands for testing and developing ready-meal biodegradable packaging trays.
Sensing the extraordinary growth opportunities in the biodegradable packaging material market for the F&B industry, another market player – the Mondi Group recently developed an innovative, paper-based, biodegradable packaging bag for food – Sustainex®, in collaboration with a Polish converter, SILBO. Multifold opportunities for biodegradable packaging in the F&B industry are boosting market players to develop innovative technologies, biodegradable packaging materials, and designs, which is expected to influence the dynamics of the biodegradable packaging material market in the upcoming years.