Polybutylene Adipate Terephthalate Market

Polybutylene Adipate Terephthalate Market

The global polybutylene adipate terephthalate market was valued at USD 1.5 billion in 2022 and is projected to reach USD 2.8 billion by 2027, growing at 13.1% cagr during the forecast period. Increasing demand for polybutylene adipate terephthalate (PBAT) from emerging markets and rising demand for PBAT from packaging and consumer goods industries are driving the market.

Attractive Opportunities in the PBAT Market

Note: e-estimated p-projected.

Source: Expert Interviews, Secondary Sources, and MarketsandMarkets Analysis

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Polybutylene Adipate Terephthalate Market Dynamics

Driver: Shift in consumer preference towards bio-based plastics

Consumer awareness regarding sustainable plastic solutions and pervasive efforts to eliminate the use of non-biodegradable conventional plastics contribute to the market growth of biodegradable plastics such as PBAT. Traditional plastics, which are generally petroleum-based, take decades to break down or degrade and lay in landfills for a long period. Biodegradable plastics break down faster when they are discarded and are absorbed back into the natural system. In addition, the rate of decomposition of biodegradable plastics by the activities of microorganisms is much faster than that of traditional plastics. The growing consumer awareness regarding these adverse effects (arising from traditional plastics) encourages the use of PBAT.

There is also growing concern over the potential health risks associated with traditional plastics. PBAT is a non-toxic material, which makes it a safer and healthier option. For example, PVC may cause genetic disorders, ulcers, deafness, and vision failure. Consumers are becoming more conscious of the impact of their purchasing decisions on the environment. As a result, there is an increasing demand for sustainable and eco-friendly products, including those made from PBAT.

Restraint: Higher price of PBAT than that of its alternatives

The higher cost of biodegradable plastics than that of traditional polymers restrains the market's growth in many application segments. Generally, the production cost of biodegradable plastics is 20–80% higher than that of conventional plastics. This is primarily due to the high polymerization cost of biodegradable plastics, as most of the processes are still in the development stage and hence, have not achieved economies of scale.

PBAT is a relatively new and innovative material, and its production is still limited compared to traditional plastic materials. The production process for PBAT is complex and requires specialized equipment and techniques, which can increase the production cost. Additionally, the raw materials used in PBAT production, such as succinic acid, adipic acid, and butanediol, are more expensive than the raw materials used in traditional plastic production. The higher cost of PBAT can make it less competitive with traditional plastic materials, especially in applications that require high volumes or low-cost materials. However, as the demand for sustainable and eco-friendly materials continues to grow, the cost of PBAT is expected to decrease as production technology improves.

Opportunity: High potential in emerging economies

The bioplastics & biopolymers market players are continuously implementing organic and inorganic strategies for their growth. PBAT is gaining popularity in emerging markets, where the demand for sustainable materials is growing rapidly. This presents significant growth opportunities for PBAT manufacturers, especially in regions like Asia, Africa, and South America. In south Korea LG Chem is building a 50,000 ton/year plant, which will be operational by 2024.  Similarly, SK Geo Centric and Kolon Industries are partnering to establish a 50,000 ton plant in Seoul, South Korea.

Challenge: Easy availability of competitive products

PBAT is not the only biodegradable material available in the market. Other biodegradable materials, such as PLA (polylactic acid), PHA (polyhydroxyalkanoate), and starch-based polymers, are also available and may offer advantages over PBAT in certain applications. The most prevalent biodegradable plastic preferred over PBAT is PLA.

Polybutylene Adipate Terephthalate Market Ecosystem

Source: Secondary Research, Interview with Experts and MarketsandMarkets Analysis

In terms of value, the packaging segment is projected to account for the largest share of the PBAT market, by end-use industry, during the forecast period.

The packaging industry accounted for a share of 50% in terms of value, of the overall PBAT market in 2021.  Packaging applications of PBAT polymers include food packaging, non-food packaging, healthcare packaging, cosmetic & personal care packaging, shopping bags, and others. They are used for manufacturing bottles, loose-fill, cups, pots, bowls, flexible films, and other products. There is a huge demand for packaging made from PBAT polymers as they are used for wrapping organic food and premium and branded products having specific requirements. Food & beverage manufacturers are increasingly switching to PBAT polymers to mitigate environmental and economic issues. In many regions, especially Europe and North America, stringent governmental regulations are forcing industries to reduce their carbon footprint, which has increased the demand for PBAT based products.

Films, Sheets & Bin Liners  is projected to account for the fastest growth of the PBAT market, by application, during the forecast period

Based on application, the Films, Sheets & Bin Liners segment dominated the market.  PBAT is often used for the production of films due to its good stretchability, flexibility, and good processability. The films made from PBAT can be transparent, translucent, or opaque, depending on the desired end-use application. PBAT films also have good sealability and good printability, making them suitable for use in flexible packaging applications. It is used in various applications such as packaging films for food, industrial, and agricultural products.

APAC is expected to be the fastest-growing market during the forecast period.

Based on region, Asia Pacific is a key market to produce PBAT and is projected to grow at a CAGR of 14.5% in terms of value during the forecasted period. The availability of low-cost raw materials and labour, coupled with growing awareness among people, makes the region an attractive investment destination for PBAT manufacturers. The rising population, urbanization, and industrialization are some of the factors that will drive the PBAT market in this region.

Source: Secondary Research, Interview with Experts and MarketsandMarkets Analysis

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Polybutylene Adipate Terephthalate Market Players

Major players operating in the global Polybutylene Adipate Terephthalate Market include BASF SE (Germany), Novamont S.p.A (Italy), Willeap (South Korea), Kingfa (China), Hangjhou Peijin Chemical Co. Ltd (China), Zhejiang Biodegradable Advanced Material Co. Ltd (China), Anhui Jumei Biotechnology (China), Go Yen Chemical Industrial Co. Ltd (Taiwan), Jinhui Zhaolong Advanced Technology Co. Ltd (China), Mitsui Plastics, Inc (US), and Chang Chun Group (China).

Polybutylene Adipate Terephthalate Market Report Scope

This report categorizes the global Polybutylene Adipate Terephthalate Industry based on grade, application, end-use industry, and region.

On the basis of grade, the PBAT market has been segmented as follows:

• Extrusion Grade
• Thermoforming Grade
• Other Grades

On the basis of application, the PBAT market has been segmented as follows:

• Films, Sheets & Bin Liners
• Coatings & Adhesives
• Molded Products
• Fibers
• Other Applications

On the basis of end-use industry, the PBAT market has been segmented as follows:

• Packaging
  • Food Packaging
  • Non-Food Packaging
• Consumer Goods
• Agriculture
  • Mulch Films
  • Netting
  • Others
• Bio-medical
  • Medical Devices
  • Medical Consumables
  • Bone Implants
• Other End-Use Industries
  • Textiles
  • Electronics

On the basis of region, the PBAT market has been segmented as follows:

• Asia Pacific
• Europe
• North America
• Middle East & Africa
• South America

Recent Developments

• In June 2022, Confoil, an Australian manufacturer of food packaging and BASF collaborated to develop certified compostable dual ovenable paper tray for packaging. These trays are made of lightweight paperboard and coated with BASF’s biopolymer Ecovio PS 1606.
• In April 2020, Novamont S.P.A launched a new grade of Mater-Bi for extrusion coating and lamination on paper board and other substrates, which can be compostable in industrial parts. This grade provides an appreciable improvement in process stability, coating thicknesses, and processing speed comparable with LDPE, and excellent adhesion to different substrates. The excellent toughness and resistance to perforation make it suitable for food and microwave use.

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