Bioplastics Investment Soars as Market Expands

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Investors are pouring billions into the bioplastics industry, foreseeing a massive business opportunity in a sector at a time when plastic pollution has become a major global concern. Bioplastics are plastics made from natural resources such as oils and starches.

According to data from market intelligence provider i3 Connect, $500 million was invested in bioplastic manufacturing in the first quarter of 2022, up from $350 million in the last quarter of 2021. Georgia-based Danimer Scientific is making a big bet in the industry, investing more than $700 million into expanding its manufacturing operations in the state.

A new facility is scheduled to come up by 2023 that will manufacture a type of bioplastic called polyhydroxyalkanoates (PHA), which is created by using microorganisms that ferment with canola oil. Founded in 2007, Danimer Scientific is one of the largest PHA manufacturers in the world.

Tests have shown that Danimer’s PHA can biodegrade within two years in soil and in six months in a marine environment, CEO Stephen Croskrey said in an interview with AP.

Plastics made from fossil fuels, however, never fully disintegrate. Instead, they break down into smaller particles. Since 1950, around nine billion tons of fossil fuel plastics have been manufactured, of which just 9 percent is estimated to have been recycled.

Another type of bioplastic is polylactic acids (PLA), which is made by fermenting sugar extracted from sugar cane and corn. NatureWorks, based in Minneapolis, is the world’s largest PLA company, and is investing $600 million at its plant in Thailand.

Unlike PHA, PLA takes a longer time to disintegrate. It needs to be mixed in with food waste to break down, something that will only occur over several decades.

The U.S. biodegradable market is estimated to be worth $1.94 billion in 2022, according to a June 10 news release by Research and Markets. The firm expects the market to grow at a compound annual growth rate of 20.1 percent, to hit $4.5 billion by 2027.

Concerns Regarding Land Use, Product Marketing

There are concerns about using agricultural land to manufacture bioplastics. Hasso von Pogrell, managing director of European Bioplastics, however, dismisses such worries.

In 2021, only 0.7 million hectares of land were used for producing feedstock for manufacturing bioplastics, accounting for just over 0.01 percent of the five billion hectares of global agricultural land.

“In relation to the available agricultural area, this share is still minimal. Thus, there is no competition between the renewable feedstock for food and feed and the production of bioplastics,” von Pogrell said, according to a December 2021 article published at the European Bioplastics website. “Over 90 percent of the global agricultural area is used for pasture, feed, and food.”

While speaking to AP, Ramani Narayan, a professor of chemical engineering at Michigan State University, stated that companies are using claims of biodegradability as a tool to attract customers. He thinks that the term has been “misused, abused, and overused.”

PHA takes longer to break down in cold oceans, a fact that shouldn’t be sugarcoated, he said, while admitting that bioplastics more easily biodegrade than fossil fuel plastics, which can take hundreds of years to disintegrate.

Naveen Athrappully

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Naveen Athrappully is a news reporter covering business and world events at The Epoch Times.



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