Polylactic Acid Market

Market Overview

The global polylactic acid market was valued at USD 0.95 billion in 2022. It is estimated to reach USD 3.82 billion by 2031, growing at a CAGR of 16.7% during the forecast period (2023–2031). Growing demand for bioplastics and the flexible packaging industry promote the market’s growth.

Polylactic acid (PLA) is a thermoplastic polyester that can be made affordably from renewable resources and has grown in popularity in the global Polylactic Acid industry. Though it is still not a commodity polymer, it had the world's greatest consumption volume of bioplastic in 2021. PLA's low melting temperature, minimal thermal expansion, strong strength, and outstanding layer adhesion make it a suitable material for 3D printing and biomedical applications. Despite its good qualities, several physical and processing flaws have hampered its wider implementation. PLA is widely employed in creating packaging materials, textiles, and medical implants because of its biodegradability and biocompatibility. PLA is made by fermenting plant starches such as corn, cassava, or sugarcane, making it a more sustainable and environmentally friendly alternative to standard plastics.

Market Dynamics

Global Polylactic Acid Market Drivers

Growing Demand for Bioplastics

Bioplastics are sustainable alternatives to conventional plastics, particularly in flexible and rigid packaging applications, as the former is fully or partially bio-based, compostable, and biodegradable. Bioplastics are materials in which all the carbon is derived from renewable sources like corn, sugarcane, algae, potatoes, bacteria, seashells, and starch. PLA and polyhydroxyalkanoates (PHA) are bio-sourced and break down faster than petroleum-based plastics. Their lower carbon footprint makes them more appealing than traditional plastics.

Additionally, the rising importance of environmental sustainability, predicted to lead to less demand for petroleum-based products and more for bio-based alternatives, is a major force propelling the flexible packaging market. Bioplastics are expected to reduce carbon footprint substantially and are, thus, likely to be promoted by major regulatory bodies worldwide.

Growing Demand from the Flexible Packaging Industry

PLA packaging provides an environment-friendly solution and helps enhance the final product's appearance. PLA packaging has become an essential part of the green packaging of various food products and is likely to improve its growth prospects over the forecast period. The growing usage of bioplastics in flexible packaging is expected to fuel the expansion of polylactic acid. Furthermore, growing demand for packaged foods is anticipated to prompt manufacturers to increase production capacity. One of the many factors fueling the demand for flexible packaging is the rapid expansion of the global pharmaceutical industry. Owing to advancements in science and technology, the pharmaceutical industry has registered sharp growth over the past few years, and this trend will likely continue over the forecast period.

Global Polylactic Acid Market Restraint

Price Competitiveness

Polylactic acid's premium price over conventional polymers, including polypropylene (PP), polyethylene (PE), polyvinyl chloride (PVC), polyethylene terephthalate (PET), and polystyrene (PS), is one of the key factors restraining the global PLA market. The major cost factor is the raw material used in the fermentation process. Advancements in glucose fermentation have lowered the cost of production of lactic acid and PLA. This price gap between polylactic acid and the above-mentioned conventional plastics is expected to continue shrinking owing to technological advancement and the availability of alternative raw materials in the coming years, which is expected to mitigate the impact of the restraining factor. In the past years, climate change and global warming have made a huge impact on cultivation, mainly owing to irregular rainfall, which, in turn, has affected the overall crop yield.

Furthermore, polylactic acid suffers from performance drawbacks compared to conventional plastics; it can warp and distort at relatively low temperatures—however, companies operating in the market focus on enhancing the polymer's heat resistance. Continuous efforts to develop PLA with higher heat resistance are expected to aid in overcoming the market's growth barriers.

Global Polylactic Acid Market Opportunities

Different Scope in Industry

PLA is primarily used for packaging applications, such as fruit and vegetable packaging, and disposable products, such as cups and cutlery. It is biodegradable and can be broken down in a suitable composting facility within 45 to 90 days. However, PLA suffers from low resistance to high heat and humidity, low heat distortion temperature (HDT), and long mold cycle time. To overcome these drawbacks, market players should focus on developing PLA with higher heat resistance and cater to the needs of applications, which, in turn, will accelerate the market growth.

Textile is another important sector with a high market penetration and growth rate, as polylactic acid offers smooth and pleasant fabrics. In addition, PLA provides excellent moisture and UV resistance, durability, breathability, and durability. These benefits are anticipated to propel the demand for PLA in the textile industry over the forecast period.

Regional Analysis

Based on region, the global polylactic acid market is bifurcated into North America, Europe, Asia-Pacific, Central and South America, and the Middle East and Africa.

North America Dominates the Global Market

North America is the most significant global polylactic acid market shareholder and is estimated to exhibit a CAGR of 16.8% over the forecast period. The growing demand for bioplastics will likely drive the market. Additionally, the regional market is characterized by the demand for sustainability, leading to a strong demand for sustainability in packaging. The overall demand for bioplastics in North America will likely be spurred by initiatives by the U.S. Department of Agriculture to promote environmentally friendly products. The regional market is likely to grow due to major driving factors such as increasing demand for 3D filaments and the availability of raw materials. Moreover, strong environmental regulations are further anticipated to fuel the demand for polylactic acid during the forecast period. For instance, ASTM D6400 is the standard specification for plastic products falling under the category of compostable or biodegradable, which must decompose completely in a composting setting without leaving any harmful residues afterward.

Asia-Pacific is anticipated to exhibit a CAGR of 18.6% over the forecast period. Major driving factors include a lack of resources for fossil fuels, increasing demand for products from developing countries such as Indonesia, Thailand, and Malaysia, and fluctuating petroleum prices. Total Corbion PLA, Zhejiang Hisun Biomaterials Co., Ltd., SUPLA (JIANGSU SUPLA BIOPLASTICS CO, LTD.), COFCO, Jiangxi Keyuan Bio-Material Co., Ltd., and Shanghai Tong-Jie-Liang Biomaterials Co., Ltd, are some of the prominent polylactic acid players operating in the region. Asia-Pacific is characterized by easy availability of raw materials and low labor costs. The PLA market in the Asia Pacific is primarily driven by the ascending demand for the product from key industries, including automobile and transport, electronics, textile, packaging, appliance, and medical.

The European PLA market will likely see substantial growth in the upcoming years due to various factors, such as stringent environment-friendly laws and increasing consumer environmental concerns. The demand for PLA is expected to increase during the forecast period due to government measures like the EU's decision to reduce the total use of single-use plastic items. PLA is widely used in essential applications such as shopping bags, bottles, agricultural mulch films, and protective apparel and equipment. The market will likely be driven by the increasing acceptance of PLA in key application industries such as packaging, textiles, electronics, automotive and transport, appliances, and medical.

In Central and South America, increasing demand for PLA in packaging, textile, medical, and other end-use is fueling the market growth in the region. The presence of major agricultural countries in the region, such as Brazil, Argentina, Chile, and others, is anticipated to create a demand for PLA over the forecast period. Rising coronavirus cases in Brazil, Argentina, Chile, Colombia, and other countries are impacting the demand for PLA among various end-use, such as fashion apparel, automotive, electronics, and others, owing to the slowdown in manufacturing activities and reduced demand from end-use customers.

The Middle East and Africa PLA market will likely grow steadily during the forecast period. Saudi Arabia dominated the Middle East and Africa PLA market. This trend will likely continue over the forecast period. Rising environmental concerns and the increasing inclination of consumers toward sustainable products are anticipated to fuel the demand for PLA among end-use application industries. 

Segmental Analysis

The global personalized nutrition market is bifurcated based on end-use.

Based on the end-use, the global polylactic acid market is bifurcated into packaging, agriculture, transport, electronics, textile, etc.

The packaging segment dominates the global market and is projected to exhibit a CAGR of 17.8% over the forecast period. PLA is widely utilized in packaging end-use such as food and beverage packaging, personal care packaging, and household care products. Manufacturers use polylactic acid in packaging due to consumer demand for environmentally friendly products and the growing global waste disposal problem. Single-use plastics have been outlawed in several places, including the United Kingdom, Taiwan, New Zealand, Zimbabwe, and several states in the United States, including New York, California, and Hawaii, all of which are contributing to a major increase in demand for PLA in packaging end-use.

Food packaging is the major driver of PLA in the packaging industry. Polylactic acid is widely used for manufacturing bottles, jars, and containers and for packaging fresh food. PLA plastic bottles are durable, disposable, and possess properties such as transparency and gloss. Compared to petroleum-based products, it can be easily composted and does not emit toxic gases on incineration. Thus, its demand in this application area will remain strong over the forecast period.

Recent Developments

• May 2023- Uhde Inventa-Fischer announced the opening of a new PLA manufacturing plant in Germany. The factory has a capacity of 10,000 metric tons per year. This development is part of Uhde Inventa-Fischer's goal to address the growing demand for PLA in Europe.
• April 2023- NatureWorks established a long-term arrangement with PepsiCo to supply PLA for the company's food packaging. NatureWorks will benefit greatly from this partnership, strengthening the company's position as a leading provider of PLA.