Polylactic acid (PLA) is one of the most important biodegradable thermoplastics which is compostable and completely recyclable. It is derived from lactic acid and is mostly produced from sugar beet, wheat, maize, sugar cane, and other starch-rich and renewable products.
The product has excellent tensile strength and modulus of elasticity like PET. Major thermoforming applications of PLA are for packaging uses in the food industry, mostly disposable tableware articles like glasses, drinking cups, straws, food plates, and containers. PLA is also used to make bottles for detergents and beverages. Injection molding and roto molding applications of PLA include industrial machines and automotive parts. It is also used to make cutlery items. Other small applications include agricultural sectors such as films and bags. Fiber and non-woven applications include biodegradable one-use fabric articles such as blankets, disposable garments, carpets, hygiene products, and diapers. Emerging uses of PLA include 3D printing where it is used as a filament for 3D printers.
The global Polylactic acid production capacity in 2022 was estimated to be over 700 thousand tons, with a global demand of over 490 thousand tons in the same period. The global operating rates have varied from 62% - 72% between 2016 and 2022. However, with several capacity additions announced in China in the coming years, the global Polylactic acid operating rates are forecast to reach 60% by 2032.
Shenzhen eSUN Industrial Co., Ltd.
Shanghai Tongjie Liang Biomaterials Co.
Guanghua Weiye
Hengtian Yangtze River
Shandong Golden Corn Biochemical Co., Ltd.
Zhejiang HiSun Biomaterials Company Limited
Shandong Hongda Biotech
Natureworks and Total Corbion are the biggest Polylactic acid producer in the world together producing more than 220 thousand tons of Polylactic acid.
Packaging application dominates the global Polylactic acid market and it is estimated to be one of the fastest-growing applications for during the forecast period. The sector accounts for more than 60% of the global PLA market in 2022 and it is further projected to grow at an annual average of 17% between 2023-2032. With a certain set of standards and certification procedures for PLA, along with the growing influence of regulatory and environmental protection agencies in most of the major countries of the world, the use of PLA to make bottles, containers, and blister packaging is expected to continue its upward trend in the coming years.
Packaging has shown higher growth than the GDP of most of the countries around the world. With the expected high growth in the Asian packaging industry due to growing industrialization and purchasing habits in the region, the global packaging market is expected to witness fast growth during the forecast period.
Consumer goods application that include containers, fast-food tableware, food box, toys, egg cartons, bottles, 3D printing, toys, etc. is second biggest consumer of accounting for around 20% of the global Polylactic acid demand. The application is further projected to witness strong growth of 16% in the forecast period. Several multinational consumer goods manufacturing companies have announced or declared intentions to switch to biodegradable plastic material in the forecast period, which will drive the demand for PLA in consumer goods applications.
The PLA market is expected to grow strongly, especially in countries with large populations such as China, Japan, Taiwan, India, Indonesia, Thailand, Philippines, and Vietnam. Further, the increase in living standards and increasing purchasing power among consumers due to economic growth will keep the regional biodegradable plastics demand high. Asia has historically witnessed healthy growth rates in demand mainly driven by the burgeoning economies of China, Taiwan, Japan, South Korea, and others.
Asia-Pacific is the largest PLA producer in the world with installed capacity of more than 490 thousand tons in 2022, accounting for around 70% of the global Polylactic acid capacity. The region accounted for around 60% of global PLA demand and is projected to cross 1600 thousand tons by 2032 with an annual growth rate of 18% between 2022-2032. The polylactic acid market is expected to grow strongly, especially in countries with large populations such as China, Japan, Taiwan, India, Indonesia, Thailand, Philippines, and Vietnam.
Further, the increase in living standards and increasing purchasing power among consumers due to economic growth will keep the regional biodegradable plastics demand high. Asia has historically witnessed healthy growth rates in PLA demand mainly driven by the burgeoning economy of China, Taiwan, Japan, South Korea, and others. With increasing demand for PLA from China and other Southeast Asian countries owing to various incentives, stimuli as well as higher demand from China, Taiwan, and Japan. In the long-term forecast, the demand growth for PLA in the region is estimated to grow on accounts of increased growth from packaging and other consumer goods applications.
The Western European country's decision to reduce the consumption of conventional thin-film plastic bags significantly will also push for production of more biodegradable bags thereby increasing the demand for biodegradable plastics like PLA. With new investment in the PLA thermoplastics sector globally along with industries like packaging and manufacturing that are shifting their base to Asian countries, the demand for Polylactic acid in these sectors will increase during the long term.
The average Polylactic acid prices were around $3040-3210 per ton in 2022. This was an increase of almost 4% from the previous year when the PLA prices were around $2940-3100 per ton. The increase in PLA prices was due to several factors, including, the COVID-19 pandemic, global economic conditions, and government policies. The COVID-19 pandemic has also had an impact on the average trade prices of PLA. However, the demand for Polylactic acid in the packaging industry has remained strong throughout the pandemic, as consumers increasingly prefer eco-friendly packaging material.
The Polylactic Acid market has been growing at a steady pace over the years but a shift in preferences of the end-users has been observed in many regions like Europe. Long term impact of plastic on the environment has been deemed to be fatal, and substitutes for the currently used products are being pushed forward. While usage of polyethylene based agricultural sheets is prevalent in the market, bans on the usage of single-use plastics have shown adverse impacts on the market.
Increase in government regulations for the usage of these non-degradable films have been increasing. Owing to these changes in preferences and regulations, top manufacturers in the market have been working to introduce biodegradable Polylactic Acid.
Companies have been investing in research of new alternatives and investments in increasing portfolios have been observed in the market. Companies like Berry Global and BASF SE are at the forefront of these developments. Growing interest in sustainability goals has led to an increase in investments in biodegradable Polylactic Acid and bioplastics, which is expected to bring significant change in the Polylactic Acid market.
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