Regional Market Outlook on Bio-degradable Packaging
Being a fairly nascent market, volume commitment and long term engagement would help buyers during price negotiations. Supply base is fragmented which reduces switching costs leveraging the bargaining power for buyers.
India is a developing market for bio-degradable packaging, where much of the raw materials are imported from Europe and China. Converters mainly use PLA as the primary resin for bio-degradable packaging products such as bags, pouches and bottles.
India Market Outlook for Bio-degradable Packaging
- Plastic bags occupy nearly 65-70 percent of the overall bio-degradable packaging market. Growth of organized retail at 32 percent CAGR for the next five years along with stringent regulations being implemented in many states are a primary drivers for the growth of bio-degradable plastic bags
- Consumer awareness and eco-friendliness of re-usable bags has given rise to jute bags as an alternative to PLA
- E-commerce boom and growth of online retail sales at 31 percent is expected to promote local production and new suppliers in the market
- Emerging end-use segments of metalized biaxial oriented -PLA films for food packaging is expected to introduce new technology into the market promoting the growth of bio-degradable packaging within India
- Apart from regulations and duties, state governments are keen on promoting consumer awareness campaigns on the benefits of bio-degradable packaging