New Material Intelligence NMT | What are the business opportunities in the biodegradable industry?

Recently, the news that “bio-based degradable enterprises have completed nearly 100 million yuan of Pre-A round financing” shocked the whole industry.
It is reported that China Science and Technology Corporation, founded in 2021, is a bio-based material and research and development company committed to building the bio-based material industry chain.
But if it is not for the three years of the epidemic, the financing may reach a faster speed.
For such financing news, the industry may have become accustomed to it. After all, it has been affected by the epidemic in the past few years. Meirui New Materials, Meilian New Materials, Wanhua Chemical and other leading manufacturers have all sold good performance news. Among them, Meilian New Materials is particularly outstanding, and the net profit of the parent company has more than tripled.
So in this inferior market, can we still create such achievements? What are the business opportunities in the industry?
New Material Intelligence NMT | What are the business opportunities in the biodegradable industry?
In fact, the research on bio-based degradable technology has a long history. It can be traced back to the 1960s when DuPont began to use indirect methods to prepare polylactic acid. After a long period of research and development, it has been gradually industrialized and put into practice. At present, the downstream biodegradable plastics are mainly used in packaging, agriculture, 3D printing, modern medicine, textile industry, etc.
In 2020, China proposed the “double carbon” strategy, taking bio-based materials as the key task of the “Fourteenth Five-Year Plan”. China is vigorously developing the plastic recycling economy, establishing a plastic pollution control system, improving and innovating plastic raw materials, and working to prevent and reduce possible plastic pollution from the source. Compared with the alternatives of traditional plastics, biodegradable materials are plastic-like, have a wider range of applications and are more environmentally friendly. It can be seen that the domestic degradable plastics industry has a huge development prospect. As the majority of the market of degradable plastics, biodegradable plastics have gradually become the focus of attention in the domestic degradable plastics field.
New Material Intelligence NMT | What are the business opportunities in the biodegradable industry?
Due to the continuous expansion of the application scope of biodegradable plastics and the steady development of downstream products such as biodegradable shopping bags and biodegradable disposable tableware, the consumption of domestic biodegradable plastics has continued to increase from 151000 tons in 2016 to 2200000 tons in 2020, with a CAGR of 9.8%. In the future, with the growth of downstream market demand, the consumption of biodegradable plastics in China is expected to increase significantly, and the consumption is expected to reach 338000 tons in 2022.
The total sales revenue of domestic biodegradable plastic products increased from 3.39 billion yuan in 2016 to 6.06 billion yuan in 2020, with a CAGR of 15.7%. Among them, the sales revenue of express packaging, disposable tableware, disposable shopping bags and other biodegradable plastic products increased at a CAGR of 13.4%, 15.8%, 16.0% and 10.9% respectively. It is estimated that the total sales revenue of biodegradable plastic products in China will reach 9.69 billion yuan in 2022.
In the category of biodegradable plastic products, the market share of disposable shopping bags reached 71.3%, followed by disposable tableware, with a market share of 21.5%. The market share of express packaging is 4.8%.
Sales revenue of biodegradable plastics: The total sales revenue of domestic biodegradable plastics products increased from 3.39 billion yuan in 2016 to 6.06 billion yuan in 2020, with a CAGR of 15.7%. Among them, the sales revenue of express packaging, disposable tableware, disposable shopping bags and other biodegradable plastic products increased at a CAGR of 13.4%, 15.8%, 16.0% and 10.9% respectively. It is estimated that the total sales revenue of biodegradable plastic products in China will reach 9.69 billion yuan in 2022.
In the category of biodegradable plastic products, the market share of disposable shopping bags reached 71.3%, followed by disposable tableware, with a market share of 21.5%. The market share of express packaging is 4.8%.
In terms of the number of patents issued, the number of patent applications for biodegradable materials in China increased year by year from 2016 to 2021, from 357 to 637. The importance of this field gradually deepened, and the innovation of enterprises continued to improve.
From the results, from 2016 to 2020, the total domestic production of biodegradable plastics increased from 166000 tons to 241000 tons, with a CAGR of 9.7%. Due to the continuous expansion of production capacity and the continuous improvement of capacity utilization rate, it is estimated that China’s production of biodegradable plastics will reach 365000 tons in 2022. In the context of carbon neutrality, bio-based materials and degradable plastics are gradually leading scientific and technological innovation and economic development in the contemporary world due to their green, environmentally friendly and resource-saving characteristics. At the same time, it can replace petroleum-based polymer materials, thus alleviating the current energy crisis and environmental crisis facing mankind.
New Material Intelligence NMT | What are the business opportunities in the biodegradable industry?
With the awakening of environmental awareness in China, a new generation of people began to reflect on the degradability of garbage. They also began to realize that the substitution of bio-based for petroleum-based will become a major trend in the future. Biodegradable plastics will be the main development direction of degradable plastics industry in China and even in the world in the future. Under the background of the shortage of petroleum resources, the serious dependence of energy on imports and the serious white pollution in China, promoting the application of biodegradable plastics and even the birth of a new ecological plastic industry is a major direction of industrial transformation. Stimulated by the market, the downstream market will be further opened, and the production capacity will also be increased, thus forming a market of 100 billion yuan.