The Eco-Friendly Packaging market shares value is expected to grow at a CAGR of 8.9% during the forecast period 2023-2028 to reach USD 334.3 billion by 2028.
Eco-friendly packaging is a type of packaging that is easy to recycle and bio-degradable, it is made up of packaging material that is easily reusable, and when disposed of in the environment, it gets degraded easily. Causing no harm or pollution in the environment. Eco-friendly packaging aims to reduce pollution and conserve resources. This eco-friendly packaging material is made up of paper, cardboard, or glass. Using this packaging material, the environment can be sustained. Also, it will restore the natural functioning of the flora and fauna. With growing awareness and government initiatives, companies have started using biodegradable packaging material. Since then, the demand for such packaging materials has increased.
Consumers are becoming more aware of the detrimental effects of packaging material on the environment; this has led to the adoption of eco-friendly packaging material by consumers as consumers are becoming aware of the ill effects of single-use plastics and non-recyclable materials on how it contributes to pollution, landfill waste, and harm to flora and fauna. This caused consumers to seek biodegradable packaging materials such as paper, cardboard, and glass. In addition to this, sustainability has also become a crucial factor for consumers while purchasing, and it led to consumers seeking products that are packaged with eco-friendly material. This has also caused manufacturers to package their products with labels that describe them as bio-degradable and non-toxic to the environment. Social media platforms also play an important role in spreading information about environmental issues and sustainability. And this led to an increase in the market demand for the eco-friendly packaging material market and its growth. Thus, awareness among consumers is the major driving factor for the eco-friendly packaging market.
Governments around the world are taking the initiative and implementing guidelines that promote the use of biodegradable and eco-friendly materials to reduce pollution. Government these guidelines include restricting the use of toxic and non-degradable material by fining people. These stricter rules and regulations force people to adopt sustainable products, which is fuelling the eco-friendly packaging market demand.
There is a growing demand for bio-degradable packaging materials in the food and beverage industry, as the food and beverage industry is rapidly adopting biodegradable packaging materials to protect the environment from plastic pollution. This attribute is accelerating the demand of the market to an extent.
Eco-friendly packaging materials require high costs for manufacturing and production processes; these higher costs cause restrictions for smaller businesses since a lower budget creates a constraint for adopting such eco-friendly packaging material. Also, as the manufacturing cost gets high and increases, the selling price for the consumers also increases, and it discourages consumers from going for eco-friendly packaging. This has caused a restraint in the eco-friendly packaging market size.
The adoption of eco-friendly packaging materials has increased, and despite that, due to limited technology, equipment, and infrastructure, the process of collecting, sorting, and processing recycling materials is underdeveloped.
As government around the world are aware of the effects of using non-biodegradable materials, the implementation of rules and regulations has led to a decline in the usage of such materials; these policies can also provide subsidies to packaging materials manufacturers. To encourage the key players to produce and level up their production process. Such an opportunity will cause a surge in production and demand for the eco-friendly packaging market. Investment in technology and innovation by the government for providing infrastructure for recycling the materials can create an opportunity for an eco-friendly packaging market, which will lead to an increase in market size.
The outbreak of COVID-19 had a significant negative impact on the eco-friendly packaging market; it witnessed a decline due to the imposition of restrictions and lockdowns. As the travel ban was implemented, it caused disruptions in the global supply chain of raw materials required for the processing of bio-degradable materials; also, in addition, the shortage of laborers hampered the production capacity and led to the shutdown of many companies. As the purchasing power of consumers decreased, it led to a decline in the sales of products and consumables that were packaged with eco-friendly materials. Thus, the impact of the pandemic had a major effect on the market demand of the eco-friendly packaging market.
Key developments in the market:
On 12th July 2023, BioPak, which is a UK-based food packaging company, launched a packaging material using FSC-certified paperboard, which is industrially compostable. This material will replace non-degradable plastics to create a more sustainable environment.
On 17th July 2023, Amcor, a global packaging material company, developed a new range of materials called sustainable shrink bags for meat and cheese packaging; these bags increase the shell life and also decrease early spoilage.
Based on type, the eco-friendly packaging market is segmented into recyclable, reusable, and degradable. The reusable segment dominates the market and has the highest market share and CAGR; this is because the packaging and materials are again reused instead of disposed of, as reusable reduces waste generation. Also, recycling bio-degradable material takes time and cost, and due to a lack of technology, skills, and budget, recycling of the material is limited.
Whereas degradable materials take time to degrade naturally in the environment, and it can lead to waste generation.
Based on the material type, degradable plastic accounts for the highest share and CAGR and has maximum demand, in the eco-friendly packaging market, due to its durability, cost, and the use of plastic in wide consumables and products. The paper and paper board packaging segment is seeing the fastest growth in the eco-friendly packaging market since paper bags are most commonly used in malls to create awareness of environment protection and sustainability. Glass is seeing steady growth due to its heavy weight and chances of breakage many manufactures restricts the use of glass as a packaging material.
Based on the applications, the food segment holds the highest market share and CAGR in the eco-friendly packaging market; this is due to the increasing use of paper bags and paper boards in restaurants; beverage segment has the fastest market growth and demand since many of the juice, water packaging, and soda manufacturing industry are using biodegradable materials for environment safety and sustainability. The pharmaceutical industry has been investing in the packaging of medicines in biodegradable material as part of the corporate responsibility initiative to protect the environment from plastic waste. These industries have driven the market size and led to the expansion of the eco-friendly packaging market.
Active Packaging
Molded Packaging
Alternate Fiber Packaging
Others
Based on the technique, the active packaging segment dominates the eco-friendly packaging market and holds the highest market share and CAGR, as active packaging is mostly used in the food industry to keep the shelf life and longevity of the food. Whereas molded packaging is gaining significance since it uses biodegradable material for packaging, this type of packaging is mostly used in trays or containers. It uses materials such as paper pulp. And alternate fiber packaging involves the use of plant-based packaging material such as bamboo. Bagasse, wheat straw, or recycled paper.
Based on the region, the Europe region dominates the eco-friendly packaging market and has the highest market share and CAGR; this is due to the increased adoption of eco-friendly materials for packaging. Also, the European government and the European Association of plastic recycling and Recovery have been promoting and creating awareness of the use of biodegradable material for the protection of the environment from plastic pollution. The North American segment has the fastest-growing market share in the eco-friendly packaging market; this is due to technological advancement and innovation, which has led to the recycling of the material convenient. Asia Pacific region has forecasted to have significant growth in the forecasted period due to a booming economy, technological advancement, and growing consumer awareness. Latin America also has a steady growth in its market size, and because of government initiatives, it will have major growth in the coming years. The Middle East and Africa have the lowest market share in the eco-friendly packaging market due to less awareness among consumers.
Amcor
Mondi Group
Sealed Air Corporation
Ball Corporation
Tetra Pak
Crown Holdings Inc
BASF
Huhtamaki Oyj
Westrock Company
Smurfit Kappa Group
Sonoco Products Company
Evergreen Packaging
Elopak, Winpak Ltd
Berry Global
Printpak Inc
Paperfoam
Sustainable Packaging Industries
Gwp Group
Swedbrand Groups
Frequently Asked Questions
Increasing awareness of environment and sustainability, along with the implementation of rules and regulations, has driven the market
The market is estimated to register a CAGR of 8.9% during the forecast period
High cost of processing and manufacturing biodegradable material is a major challenging factor for the market growth rate.
Europe region is leading with the highest shares of the market.
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