USA Biodegradable Plastic Market Outlook to 2030

USA Biodegradable Plastic Market Overview

• The U.S.A biodegradable plastic market size was estimated at USD 1.01 billion in 2023 and is projected to grow at a CAGR of 13.50% between 2023-2028 driven by increasing consumer awareness regarding environmental sustainability and stringent government regulations promoting the use of eco-friendly materials.
• The USA biodegradable plastic market is fragmented. Key players in the USA biodegradable plastic market include NatureWorks LLC, BASF SE, Novamont S.p.A., Biome Bioplastics, and Total Corbion PLA.
• In March 2023, NatureWorks LLC announced a $600 million investment to expand its Ingeo biopolymer production capacity in the USA. This expansion aims to meet the rising demand for biodegradable plastics in North America.

USA Biodegradable Plastic Current Market Analysis

• The adoption of biodegradable plastics is expected to have a significant positive impact on the environment by reducing plastic waste and decreasing the carbon footprint associated with plastic production and disposal.
• One of the primary growth drivers for the USA biodegradable plastic market is the increasing consumer demand for sustainable and eco-friendly products. This trend is further supported by the growing influence of environmentally conscious millennials and Gen Z consumers.
• California is the dominant region in the USA biodegradable plastic market. This dominance is attributed to the state's progressive environmental regulations and strong consumer base for eco-friendly products.

USA Biodegradable Plastic Market Segmentation

The USA Biodegradable Plastic market is segmented based on various factors like product, application, and region.

• By Product Type: The USA biodegradable plastic market is segmented by product type into polylactic acid (PLA), polybutylene succinate (PBS), and polyhydroxyalkanoates (PHA). In 2023, polylactic acid (PLA) dominated the market under the product type segmentation. This dominance is due to PLA's wide application in packaging, agricultural films, and disposable tableware. Its biodegradability, compostability, and relatively lower production cost.

• By Application: The market is segmented by application into packaging, agriculture, and consumer goods. In 2023, packaging dominated the market under the application segmentation. The growing demand for sustainable packaging solutions in the food and beverage industry has been a significant driver for this segment.

• By Region: The USA biodegradable plastic market is segmented by region into North, South, East, and West. In 2023, the Western region dominated the market. The region's stringent environmental regulations, strong consumer base for sustainable products, and advanced waste management infrastructure have contributed to its leading position.

USA Biodegradable Plastic Market Competitive Landscape

• Novamont S.p.A.: In February 2020, Novamont announced that its MATER-BI bioplastic, used for the production of soil-biodegradable mulching films, had been certified to comply with the "AIAB Technical Means" specification for organic farming. 
• NatureWorks LLC: In May 2024, NatureWorks announced a record $350 million financing from Krungthai Bank in Thailand to support the construction and operation of this new fully integrated Ingeo PLA manufacturing complex.
• Total Corbion PLA: In April 2021, Maire Tecnimont's subsidiary NextChem was awarded a contract by Total Corbion PLA to carry out the Front-End Engineering Design for a new 100,000-ton per year Poly Lactic Acid (PLA) production plant in Grandpuits, France. 

USA Biodegradable Plastic Market Analysis

USA Biodegradable Plastic Market Growth Drivers

• Increasing Environmental Awareness: The rising environmental consciousness among consumers is a significant growth driver for the biodegradable plastic market. According to the American Climate Perspectives Survey 2024 by ecoAmerica reveals that 80% of Americans expect the U.S. EPA to ensure a safe and healthy environment, and 71% of Americans are concerned about climate change. This shift in consumer behaviour has led to a substantial increase in the demand for biodegradable plastics.
• Technological Advancements in Bioplastics: Advances in bioplastic technology are enhancing the performance and reducing the cost of biodegradable plastics. In recent years, new production methods have been developed that increase the efficiency of bioplastic manufacturing. The adoption of new catalytic processes in production has reduced manufacturing overall manufacturing costs of biodegradable plastic, making them more competitive with conventional plastics.
• Corporate Sustainability Initiatives: Major corporations are committing to sustainability goals that include reducing plastic waste. In 2023, over 200 large corporations in the USA, including major retailers and consumer goods companies, have pledged to incorporate biodegradable plastics into their product lines. This corporate shift towards sustainability is driving the market for biodegradable plastics, as these companies seek to meet their environmental targets.

USA Biodegradable Plastic Market Challenges

• High Production Costs The production cost of biodegradable plastics remains significantly higher than that of conventional plastics. This cost disparity poses a challenge for widespread adoption, particularly among smaller businesses with limited budgets. Additionally, the lack of economies of scale in the production of biodegradable plastics further exacerbates the cost issue, making it difficult to compete with traditional plastic materials.
• Limited Infrastructure for Composting and Recycling The infrastructure for composting and recycling biodegradable plastics is still underdeveloped in many parts of the USA. As of 2024, there are only 300 commercial composting facilities nationwide, which is insufficient to handle the increasing volume of biodegradable plastic waste. This limited infrastructure hinders the effective disposal and management of biodegradable plastics, reducing their environmental benefits.
• Performance Limitations in Certain Applications Biodegradable plastics often face performance issues in certain applications, such as high-temperature environments. In 2024, research indicates that many biodegradable plastics degrade at temperatures above 50 degrees Celsius, limiting their use in certain industrial and packaging applications. This performance limitation restricts the market potential of biodegradable plastics in these sectors.

USA Biodegradable Plastic Market Government Initiatives

• Plastic Waste Reduction Act: The Plastic Waste Reduction Act of 2023, enforced in 2024, is a landmark legislation aimed at reducing plastic pollution. The act allocates 1 billion dollars in funding for the development and implementation of biodegradable plastics in various industries. This initiative is expected to boost the production and adoption of biodegradable plastics across the country.
• Federal Grants for Research and Development: In 2024, the U.S. Department of Energy announced federal grants for research and development in biodegradable plastic technologies. These grants aim to foster innovation and improve the performance and cost-efficiency of biodegradable plastics. This government support is crucial for advancing the industry and making biodegradable plastics more competitive with traditional plastics.
• National Bioplastics Strategy: The National Bioplastics Strategy, launched in 2024, outlines a comprehensive plan to promote the use of biodegradable plastics across various sectors. The strategy includes measures such as tax incentives for companies adopting biodegradable plastics and funding for public awareness campaigns.

USA Biodegradable Plastic Future Market Outlook

The USA biodegradable plastic market is poised for remarkable growth driven by increased adoption in packaging, technological innovations, and expansion of composting infrastructure. 

Future Market Trends

• • Increased Adoption in Packaging: Over the next five years, the adoption of biodegradable plastics in the packaging sector is expected to surge. This increase will be driven by growing consumer demand for sustainable products and the implementation of stricter environmental regulations, encouraging manufacturers to shift towards eco-friendly packaging solutions.
  • Expansion of Composting Infrastructure: The USA is expected to significantly expand its composting infrastructure to support the effective disposal of biodegradable plastics. By 2028, over 500 new commercial composting facilities are projected to be established nationwide, enhancing the environmental benefits of biodegradable plastics.