Biodegradable foam is environmentally friendly packaging material that decomposes completely when disposed of or composted, without polluting the environment. Commonly used in various packing industries, biodegradable foam is lightweight, reusable, durable and an excellent insulator. It is suitable for packaging electronic goods, food and beverage products to provide cushioning and prevent shocks and vibration damage during storage and transportation. Further, the compostable nature of biodegradable foam reduces the burden on landfills and minimizes greenhouse gas emissions. The global Biodegradable Foam Market is estimated to be valued at US$ 906.1 Mn in 2023 and is expected to exhibit a CAGR of 10.5% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
Growing consumer awareness about the environmental impact of plastic waste and government policies banning single-use plastics have amplified the demand for green packaging alternatives. Biodegradable foam made from plant-based materials like starch, cellulose or polyesters is disintegrating under natural conditions and does not persist in the environment. Further, biodegradable foam producers are innovating the material properties to match the protection needs of various industrial goods. Few other key trends include development of nanotechnology-based biodegradable foams displaying improved strength, rigidity and thermal insulation. Also, mushroom-based biofoam utilizing mycelium cells as binders is gaining popularity due to its superior compostability and sustainability credentials.
Porter’s Analysis
Threat of new entrants: The threat of new entrants in the biodegradable foam market is moderate as the market is highly regulated for environmental compliance which requires high capital to enter. However, regulatory support for biodegradable products is encouraging new innovations with low-cost production methods.
Bargaining power of buyers: The bargaining power of buyers in the biodegradable foam market is high given the availability of substitutes and undifferentiated products. Buyers can negotiate on price owing to the price-sensitive nature of the market.
Bargaining power of suppliers: The bargaining power of suppliers is moderate as raw materials for biodegradable foams such as starch, lignin, and recycled PET are commoditized and available from multiple regional and global suppliers.
Threat of new substitutes: The threat of new substitutes is high due to ongoing R&D for alternative biodegradable materials. Additionally, recycling of plastics provides tough competition as substitutes.
Competitive rivalry: The competitive rivalry is high owing to the presence of global players and differentiated products. Players are investing heavily in R&D to launch new products with improved properties.
Key Takeaways
The Global Biodegradable Foam Market Size is expected to witness high growth over the forecast period supported by rising awareness about environment safety.
Regional analysis: Asia Pacific dominates the biodegradable foam market led by China owing to low manufacturing costs and presence of key players. Countries like India and South Korea are also emerging as high growth markets. Europe holds the second largest share on account of stringent regulations banning single-use plastic products.
Key players: Key players operating in the biodegradable foam market are BASF SE, Arkema SA, Dow Chemical Company, Synbra Technology BV, and Sekisui Alveo AG. BASF SE is one of the largest producers of biodegradable foams with an extensive product portfolio for food packaging, automotive, and construction applications.
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