Everything you need to know about bioplastics and packaging

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Introduction

This report examines the fast-evolving bioplastics landscape in packaging and asks why adoption still lags despite the environmental advantages claimed.

Key Takeaways

• Market growth from a low base: PLA and PHA lead the bioplastics used in packaging. Yet they account for less than 1% of total plastic packaging, underscoring the gap between ambition and market reality.
• Scaling and cost barriers: High production costs, feedstock competition, and immature recycling systems keep bioplastics expensive compared to fossil-based polymers. Profitability typically only emerges at industrial scale — still a long way off for most producers.
• Feedstock diversification: New approaches using food waste, algae, and even captured CO2 as raw material could reduce reliance on land-based crops and improve lifecycle performance.
• Material trade-offs: Biodegradable plastics such as PLA and PHA are attractive for food and flexible packaging but can disrupt recycling streams and require specific composting conditions. Drop-in bioplastics like bio-PE and bio-PET, though not biodegradable, integrate more easily into existing systems.
• Policy unevenness: While EU legislation such as the Packaging and Packaging Waste Regulation (PPWR) and the global plastics treaty are setting clearer goals, incentives remain inconsistent. The lack of mandates for bio-based content and externalised fossil costs continues to distort competition.
• Collaboration drives credibility: Strategic partnerships — for example, Neste, LyondellBasell, and IKEA’s bio-PP initiative — demonstrate how shared risk, data transparency, and aligned messaging can accelerate adoption across packaging value chains.

Conclusion

For packaging producers and brands, bioplastics represent both opportunity and friction. With firmer regulatory backing and more secure feedstock supply, bioplastics could move from niche pilot to mainstream packaging material within the next decade, but only if the industry acts collectively now.

We all know the environmental arguments for transitioning to bioplastics are compelling, and European Bioplastics says it expects global bioplastics production to almost triple from approximately 2.2 Mton in 2022 to approximately 6.3 Mton in 2027. Yet even so, its market share still only stands at around 1%.

Why is this? Briefly (and we will explores some of these in more detail later) the main challenges surrounding the adoption of bioplastics (both biobased, recyclable ‘drop-ins’ and biodegradables) are as follows:

• Lack of regulatory backing
• Lack of investment
• Limited production capacity and high costs
• High land use requirements for feedstock production
• Logistical and infrastructural gaps

Policy markers such as the PPWR and the European Green Deal are taking us in the right direction although they may not go far enough (of which more later). The complexity is compounded by the fact that there are of course many forms of biopolymers and feedstocks routes to go down to produce these – whether this is food byproducts, cellulose, chitin, algae, CO2 or more besides.

Here we present a general overview of the progress made across the industry in bioplastics, highlighting some of the more interesting areas of early stage research as well as the products already on the market and available on supermarket shelves. But we will not focus blindly on the positives – we also want to highlight what is holding up adoption of biomaterials, where they may not still meet requirements in areas such as resource efficiency and finally, as always most importantly, what enabling conditions the various experts we spoke to believe we need to close the gap between fossil- and bio-based plastics.

CURRENT MARKET OVERVIEW

While new polymers are being developed all the time, here we will restrict our focus to the two most widely discussed biodegradable biopolymers, PHA and PLA, as well as the ‘drop-in’ materials such as bio-PET and bio-PP.

The PHA market

The market for PHAs has been steadily graining traction and there are several products based on these building blocks on the market today. (Incidentally I learned in passing that ‘PHA’ is also an acronym for ‘potentially hazardous asteroid’ which thankfully, at least as far as we know, has less relevance in all our daily lives – but I digress.) PHA is a family of around 150 different biodegradable polymers that can be derived from a variety of different feedstocks, from food waste to cellulose, algae and – a topic around which there is a growing buzz – CO2.

With regard to the latter we spoke to Tony Rehn, Director, CCUS & Decarbonization at NG Nordic, which transforms waste into resources across the Nordic region and is particularly focused on using CO2 to this end.

“Most of the PHAs available on the market today are made from bio-based feedstocks such as sugar cane, vegetable oils or beetroot – something you need to grow. We are now aiming to produce the same kinds of quality PHA that are currently available on the market but our raw feedstock will be CO2.”

We won’t go into exhaustive detail here on the chemistry behind this, but we did ask Tony for a brief primer on how this works. He told us: “When you incinerate waste, you will have CO2 emissions which, unless utilized, will be released into the environment. By capturing the flue gases anda turning them into an absorbent liquid you can then reheat the liquid to separate out the pure CO2 that will be combined with hydrogen – preferably green hydrogen – to produce an intermediate chemical that in our case can be fed into a biological process and use as a feedstock for growing biomass and separating out PHA from this and produce granules that can be reformed into plastics.”

The advantage of this feedstock source, he explained, is that it makes it possible to sidestep the issue of biodiversity. There is no need to use large areas of land to produce raw material for bioplastics. (Although this is not to say, of course, that it is a ‘perfect’ solution, because such a thing does not exist. A certain amount of energy will still be needed to reheat the liquid, for example, so as ever it’s a case of weighing up the pros and cons through life cycle analysis).

Furthermore, according to Lars Börger, CEO of the nova-Institut consultancy on bio-based and CO2-based economy, “If you think about the various alternative carbon sources, especially with a focus on Europe it can be stated that CO2 is the most resilient carbon source for the production of polymers, reducing reliance on fossil resources and facilitating a circular carbon economy.

”In principle all polymers can be produced from this source, either via methanol as a platform chemical, or via Syngas or via the conversion into renewable naphtha or other starting feedstock for the chemical industry. Unlike in fuels, in polymers the CO2 does not always need to be fully de-oxygenated, but can be - depending on the given polymer - directly incorporated into the material structure, thereby improving efficiency and lowering emissions.”

NG Nordic is focused on PHAs because, as Tony Rehn says, “They are the only known biodegradable polymers that have been tested according to several different ISO standards, so we can show their biodegradability in different environments. They are also listed in the European Chemicals Agency Food Contact Plastic Regulation Annex. We are now also exploring the use of PHAs in cosmetics packaging, and we are also – beyond the packaging sector – collaborating with global automation experts ABB on using PHAs for home electronics.

Tony says the company is also looking to tackle the ongoing challenge of scalability when it comes to bioplastics. He confirms they are about to commission a €10 million CapEx investment in an end-to-end pilot plant for capturing using CO2 to produce PHA, which they expect to be up and running by the end of Q1 2026. They expect to produce enough PHA using this process for customer trials next year and the next stage will be to building a commercial demo scale plant that is intended to be operational by the end of 2029.

Moving away from CO2, there are of course countless research projects and startups focused on developing PHAs from other kinds of feedstocks. In the US, Ruihong Zhang, a professor in the Department of Biological and Agricultural Engineering at UC Davis, has been working on addressing the cost barrier of scaling biodegradable plastics such as PHA. Zhang’s research has been focused on producing PHAs at a low-cost from dairy byproducts using microorganisms.

PHAs can also be combined with fibre-based packaging such as is the case with one of our pre-commercialized Sustainability Awards 2205 finalists: Helicot’s recyclable paper tube. The benefit of such solution is that it can theoretically be recycled in existing waste streams (one issue with PHAs is that they can contaminate existing streams and it is not as yet financially viable to separate them from fossil-based plastics of biobased ‘drop-ins’).

While we are still waiting for PHA to truly see a ‘breakthrough’ in the market, there are promising signs. Last year, RDM Group and Paques Biomaterials announced they were working together to develop world’s first full scale PHA biomass plant, and we expect more such announcements to follow in the coming years.

The developing market for PLA

PLA is a biobased polyester produced from renewable bio-based feedstocks that has many applications. Reader may have heard PLA described as ‘the most scalable bioplastic’, but it’s also true that which it is technically biodegradable it does not as yet readily biodegrade in an industrial composter and has a lower melting point which means that, while it is also theoretically recyclable, it cannot be recycled with other plastics which has both cost and practicality implications.

While the most well-known names in PHA are still relatively small players, startups or researchers, some of the most well-known companies in the bioplastics field produce PLA packaging, including NatureWorks LLC, TotalEnergies Corbion, and Futerro, while companies such as BAS, Mitsubishi Chemical and Avantium produce the raw material or bioplastics for packaging applications. It is certainly the most widely available technically biodegradable bioplastic today on the market, as opposed to PHAs which, while they show huge promise, are still very much at the early stages.

Just this year, TotalEnergies Corbion and Useon announced they had partnered to advance the development and global commercialization of Expanded PLA (EPLA) moulded products - high-performance foam materials made from TotalEnergies Corbion’s Luminy PLA bioplastics. The companies say these foam products are lightweight, protective and durable, making them suitable for packaging, food service, and cold-chain applications. Perhaps most significantly, if it proves to be the case in real-world conditions, EPLA is said to break down into water, carbon dioxide, and biomass under industrial composting conditions.

Also this year, Win Win Water has launched its bottled water featuring ‘100% plant-based’ fully biodegradable bottles made from TotalEnergies Corbion’s Luminy PLA material, aiming to address the environmental challenges of traditional plastic bottles while providing consumers with high-quality alkaline electrolyte water.

We have also reported on several PLA-based projects the plastics technology organization AIMPLAS has led the way in. For example, this year it announced the BIOPROCESS project working alongside Potato Bioplastics, and Gaviplas in order to ‘bolster the mechanical and barrier properties of flexible bioplastic packaging in the food, cosmetics, personal hygiene, detergent, and cleaning sectors’ – flexible packaging in any case, of course, being one of the more challenging formats when it comes to waste management.

Furthermore, AIMPLAS also this year announced the new Horizon Europe-funded GRECO project to provide biodegradable and recyclable food packaging based on novel PLA copolymers, functional coatings, additives and green catalysts. GRECO ‘aims to demonstrate the life cycle and techno-economic feasibility of greener and safer bioplastics value chains for the food packaging sector, based on a safe and sustainable-by-design strategy’.

GRECO will work on different end-of-life scenarios, including testing the recyclability of the biobased polymers and materials with mechanical and chemical recycling (both in open and in closed-loop systems). It says Innovative recycling technologies will also be used on post-consumer plastic packaging approved for food contact and deliver decontaminated recycled-biobased polyesters. (This point is especially salient given that CE Delft estimates PLA will only become economically attractive for sorters and recyclers to recycle once it reaches a 10% share of the packaging market.) At the same time, a biodegradability assessment will be performed for aerobic and anaerobic biodegradation.

Biobased ‘drop-ins’

Finally, there are the biobased or partially biobased versions of widely used plastics such as PE, PP or PET. Known as ‘drop-ins’ as they are chemically identical to the fossil-based versions, these are easier to scale than PHA or PLA as they can be recycled in the existing stream with fossil-based plastics but are not biodegradable.

There are also, says Lars Börger, certain upsides to biobased drop-ins when it comes to processing. “While PHA is currently the most versatile bioplastic in terms of biodegradability, there can be challenges because the temperature window in which it can be processed is quite small. This means the operator needs to be very precise in what they do, and sometimes they’re not. Whereas, if you have a drop-in bio-PET, for example, you can just run it as usual and it’s a relatively simple task; they don’t require a different processing technology at all.”

There have been versions of bio-based drop-ins on the market for some years now – Coca-Cola’s bio-PET-based PlantBottle being the obvious example.

Another promising bio-based drop-in we should mention is PEF, which the chemicals company Avantium has been developing for some time. This year the company signed a joint development agreement with Amcor to explore the use of its plant-based polymer PEF - branded as Releaf - in rigid containers for products including food, beverage, pharmaceutical, medical, home, and personal care.

Lars stresses the key role that cross-industry collaboration has played – and continues to play – in bringing biopolymers to market in recent years. “In a circular economy, a value chain has no clear beginning or end, which inherently increases interconnectivity and requires coordinated action across partners.

”Effective sustainability communication is critical: brand owners must convey the product’s sustainability benefits based on the renewable carbon content to the market, while raw material suppliers hold the primary evidence on sustainability criteria because they introduce the renewable carbon into the chain. Since the communication benefits and incremental costs typically lay with the brand owner, a deliberate linkage between brand and feedstock supplier is needed, differing from conventional transactional models.”

An example he puts forward is the collaboration among Neste (renewable naphtha supplier), LyondellBasell (polymer producer), and IKEA (brand owner), which delivered the first bio-based as well as bio–attributed polypropylene to the market. According to Lars, “The partnership structure distributed technical, market, and financial risks across multiple parties, enabling scale-up and credible claims backed by the supplier’s sustainability data and the brand’s marketing capabilities.”

Also involved in the bio-based drop-in market is global sustainable technology leader Johnson Matthey. As Iain Gilmore, Business Development Director - Future Technologies, tells us: “Together with our partners Virent, we have developed our BioForming technology to produce bio-based paraxylene, which is a real game-changer in terms of enabling 100% bio-based PET polyester suitable for drop-in usage in films, fibres, and packaging.

”We have carried out several successful collaborations showcasing our BioForming technology, where we have produced bio-based paraxylene that has gone into Coca Cola’s 100% bio-based PlantBottle and Patagonia’s Sugardown Hoody, as well as Japanese fashion house, Issey Miyake, supporting the launch of a 100% bio-based collection for a Paris Fashion Week.”

(As an added side note, Johnson Matthey is also involved in the growing market for PBAT, a fossil-based plastic that is inherently biodegradable. “Our technology for producing butanediol is already used commercially to produce the BDO monomer that is used in PBAT, a fully biodegradable plastic that is seeing significant growth in applications like food packaging.”)

ENABLING CONDITIONS

At the start of this piece we listed the well-known challenges that the bioplastics value chain continues to grapple with. Given the above – whidh is just a snapshot of the exciting work being done in this field, we might legitimately ask why bioplastidsdon’t have a bigger market share.

Having looked at the progress made despite these, we will finish by considering, in practical terms, the different layers or enabling conditions that will help the industry to meet its targets for biodegradable and biobased materials. Such as:

Investment

We have already cited the high production costs, scalability issues, and recycling infrastructure limitations as barriers to bioplastics adoption. And while research and technology advancements – just a few examples of which we gave above – further investment and funding, through government incentives or private equity firms, are needed to close the gap between the potential of these and market reality.

“We do believe that a certain scale the business case [for bioplastics] is viable,” says Tony Rehn. “But to scale up the technology we need to develop it further which means there must also be suitable funding mechanisms and instruments to support this. The EU Innovation Fund is a great scheme but of course there is fierce competition for this and it takes a lot of effort for companies to go after those kinds of investment mechanisms because it’s a very time-consuming application process so we definitely need some other types of incentives or schemes available.”

The policy landscape

Looking just at the EU level, European Bioplastics believes the support for bioplastics development is insufficient compared to that for improving recycled content targets. The PPWR currently states that only a limited amount of packaging should be compostable, including light carrier bags, adhesive labels attached to fruits and vegetables, and tea and coffee bags and pods.

According to Lars Börger, the challenge in terms of EU bioplastics regulation is that “It’s an uneven field in two ways. Firstly, there is the uneven field between fossil and bio-based plastics because the benefit of CO2 salvage is not taking into account in terms of pricing. The other uneven field is between fuels and materials: The Renewable Energy Directive has very clear sustainability criteria and it oversees mandates for the energy sector so a lot of biomass is diverted to fuel. There is nothing like this for the chemical field mainly because it is too complicated, whereas with fuel it is relatively simple. We think it would be great if mandatory targets were set for biobased content in chemical products specifically.”

Tony Rehn also stresses that regulation must really take into account the differences between bioplastic groups which we have laid out about.

“The Single Use Plastics Directive, for instance, does not differentiate between bioplastics so PHA is kind of in the same boat as bio-PP and bio-PET. But by definition, PHA is biodegradable and those are not. Setting distinctions in regulations would create more incentives for the kinds of novel plastics we are developing to be scaled.”

A Global Treaty

And of course, we cannot discuss the policy conditions needed to enable bioplastics without giving a passing mention to the latest, immensely frustrating stalling of the Global Plastics Treaty negotiations which, interested parties had hoped, would create a more favourable environment for biopolymers. To give an idea of what this might look like: The Natural Polymers Group, which unites industry players from Europe, India, and the US, produced a White Paper prior to the latest negotiations in Geneva asking that the Treaty should (and we quote it verbatim):

• Clarify definitions - establishing a clear, binding definition of natural, not chemically modified polymers as a distinct non-plastic category in the Treaty
• Commit to further work under the Treaty framework to establish science-based industry standards for what constitutes safe, environmentally sound and sustainable non-plastic substitutes
• Recognise regenerative end-of-life pathways acknowledging that natural polymers can be organically recycled
• Support investment and R&D for non-plastic substitutes through treaty-linked funding mechanisms, enabling scale-up.

Meanwhile, in its Policy Brief the Scientist’s Coalition for a Global Plastics Treaty is also calling for stricter definitions on terms such as ‘biodegradability’, ‘biobased’, ‘compostable’ and so on, but in this case it considers this to be more of a cautionary measure to ‘ensure these materials do not become regrettable substitutions, presenting hazards to organisms and human health or contributing to social, economic and environmental burdens’.

Along the same lines, there have also been calls for regulation to prevent companies from making misleading claims about the environmental credentials of their bioplastics by setting clear and verifiable standards about biodegradability and other properties.

CONCLUSION

Casting our eyes into the future, there are naturally other areas to explore besides the very small sample we have given above. Many see the potential for AI to be used in the development of new, novel biopolymers and bring them to maturity faster. (Incidentally, those who are interested in how AI can be used to synthesize new polymers in general, not just the biobased ones, we will be publishing a report on this topic in the near future so do watch out for that.)

Lars Börger ended our conversation on a relatively positive note, with more constructive suggestions for the future: “It’s important there is an understanding that de-fossilization needs to take place for two reasons, to protect climate and to strengthen strategic autonomy by prioritizing local alternative feedstocks, cut import dependence, and enhance resilience against supply shocks while meeting EU sustainability criteria.

“Operationalizing the Sustainable Carbon Cycles goal to replace 20% of fossil carbon with sustainable non-fossil carbon by 2030 would be a great and necessary step. This is not unrealistic given current developments.”

Our 2025 Sustainable Packaging Summit will be showcasing – among many other things – some of the latest research and innovations in biomaterials development and we hope to see as many of you there as possible.

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