Compostable Packaging Equipment Market

Compostable Packaging Equipment Market Size

The global compostable packaging equipment market was estimated at USD 34.3 billion in 2024. The market is expected to grow from USD 36.7 billion in 2025 to USD 80.9 billion in 2034 at a CAGR of 9.2%. The rise in strict environmental rules is fueling the growth of the market. Many governments across the globe are imposing stricter regulations to reduce single-use plastics and packaging waste, along with carbon emissions, so that industries shift towards green substitutes.

EU has in place a Single-Use Plastics Directive that aims to reduce plastic by 50% by 2025 and by 90% by 2040. In the US as well, it is a mixed bag where single-use plastic bags are banned in states like California and New York, with California aiming to reduce plastic waste by 75% in 2030. These laws can be used to develop compostable packaging on a commercial scale, therefore the demand for equipment such as biopolymer extruders, thermoforming machines, and automated compostable film processing machines is expected to increase throughout such regions. Moreover, the investments made in this equipment are getting a boost since governments are providing incentives such as tax breaks, subsidies, and green certifications to businesses adopting compostable packaging. Companies are responding to increasing public and investor expectations for sustainability and using them as compostable solutions to fulfill their environmental objectives. Consequently, these stringent regulations are not only driving up demand for compostable packaging but are also massively expanding the market for the equipment required to manufacture it.

Compostable Packaging Equipment Market Trends

Countries around the world are implementing laws to ban single-use plastics and encourage compostable alternatives. For example, it has been reported by the U.S. Environmental Protection Agency (EPA) that around 35 million tons of waste are generated in the whole US, and only 5% go to recycling in the year 2021. Cities such as New York and San Francisco have outlawed non-compostable plastics, prod companies to use sustainable packaging. This is also driving the demand for compostable packaging equipment due to these regulations. Under its Circular Economy Action Plan, the European Union also aims to make all packaging recyclable or reusable by 2030.

Green products increasingly influence consumer preference. This trend is forcing industries such as food service operations to adopt compostable packaging. Fifty-five percent of U.S. consumers are willing to pay more for sustainable packaging according to a 2023 survey conducted by McKinsey & Company. As more consumers look for environmentally sustainable options, companies are improving their compostable packaging gears. ?

These Were All Trending Single-use Packaging Solutions Material types such as polylactic acid (PLA) and polyhydroxyalkanoates (PHA) have much the same durability and functionality as traditional plastics. These innovations enable industries that have a high dependency on packaging such as food & beverage, cosmetics, and consumer goods to move towards composting solutions. The USDA projects the bioplastics market, which includes compostable bioplastics, to grow at a 15% annual rate through 2028, due in large part to advancements in material science.

Trump Administration Tariffs

From 2018 to 2020, the Trump Administration imposed tariffs on Chinese goods that dramatically affected the compostable packaging equipment market, driving up costs and creating disruptions in supply chains. Most of the components needed for compostable packaging machinery, such as motors, sensors, and mold systems, are imported, and China is the biggest supplier. The tariffs, which were as high as 25 percent on industrial machinery and electronic parts, increased the price of importing these parts. American imports of machinery from China fell by 16 percent in this timeframe, according to the U.S. Census Bureau, showing the impact of these tariffs.

These rising costs complicated the ability of manufacturers, particularly small and mid-sized firms, to invest in or expand compostable packaging capabilities. Delays in procurement and project timelines were also attributed to uncertainties in the supply chain. Bigger companies were able to absorb the costs or find other suppliers, but smaller ones had to postpone or scale back investments. The tariffs put pressure on some U.S. manufacturers to research the feasibility of domestic production of compostable packaging equipment, but this transition had limited momentum. In sum, the tariffs presented the market with near-term challenges by raising costs and slowing adoption, yet they also hastened the transition toward localized and resilient supply chains in the long term.

Compostable Packaging Equipment Market Analysis

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Based on equipment type, the market is segmented into extruders, film-blowing machines, printing presses, cutting machines, sealing machines, and others. In 2024, the extruders segment generated a revenue of USD 9.6 billion and is expected to grow at a CAGR of around 9.6% during the forecast period.

• The compostable packaging equipment market is a growing market where extruders are seen to lead the market on account of their role in the processing of bio-based raw materials in a functional format for packaging. The machines are critical to converting biopolymers like PLA, PHA, and starch-based blends into films, sheets, and molded products, which form the basis of many forms of compostable packaging.
  
• Extruders are incredibly valuable for a variety of industries, from food and beverages to agricultural sectors, as their versatility enables the production of an array of different products, including compostable bags, food trays, and flexible packaging. On top of that, extruders can have high throughput and scalability potential which makes them well-suited for cost-prohibitive large-scale manufacturing key necessity after many companies end their reliance on traditional plastics. Recent developments in extruder technology, including twin-screw designs and improved temperature control systems, have also optimized extruders for processing heat-sensitive and fragile biodegradable substances. Moreover, these systems can be readily integrated with downstream equipment such as thermoforms and sealing machines for streamlined, end-to-end production lines. In general, this combination of functionality, flexibility, and innovation is what makes extruders the fastest-growing segment of compostable packaging equipment.

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Based on the Distribution Channel, the compostable packaging equipment market is direct and indirect. In 2024, the indirect segment accounted for over 55.1% and is expected to grow at the rate of 9.4% till 2034.

• The indirect distribution channel is expected to hold a leading position in the market, as it provides cost-effective scalability as well as localized procurement support for manufacturers. This form of Distribution systematically involves third-party agents, distributors, or dealers selling equipment instead of from the manufacturer directly, and there are 5 major advantages of this process.
  
• Indirect channels enable manufacturers to leverage established networks of experienced distributors who are familiar with regional markets, customer preferences, and local regulations. This is also critical in a decentralized and maturing specialty, a burgeoning market, such as compostable packaging, where regional and industry segment demand varies significantly.
  

Based on the automation grade, the market is segmented by automation, semi-automation, and manual. The automation segment is expected to hold a major share of 42.1% in 2024.

• Growth of the compostable packaging equipment market is driven by automation which enhances efficiency, consistency, and scalability. This is critical because demand for sustainable packaging continues to grow around the world. However, as companies transition from traditional plastics to compostable materials, they require equipment capable of high production levels while addressing the unique requirements of biodegradable materials, which are generally more sensitive to heat and pressure.
  
• In addition, automated systems incorporate advanced technologies like sensors, AI-based monitoring, and IoT connection. This helps trace performance in real time, anticipate maintenance requirements, and seamlessly integrate with other production processes, resulting in improved efficiency. Indeed, the United States manufacturing sector has experienced a decrease in labor availability by as much as 3 percent over the last decade, according to the U.S. Bureau of Labor Statistics. This has forced companies to invest in automation for production needs and to reduce time-to-market.

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• In 2024, China dominated the compostable packaging equipment market accounting for around 87.3% of the APAC market share and generated around USD 8.5 billion in revenue in the same year. China,  India, Japan, and South Korea are key producers of compostable packaging and the equipment to make it. The area also enjoys low manufacturing costs and economies of scale that have allowed it to dominate both local and global markets. Urbanization and the increasing growth of e-commerce have made the demand for sustainable packaging increase. Governments within APAC also have an important role to play. For instance, China’s National Development and Reform Commission (NDRC), has put forward plans to ban single-use plastics in key cities by 2025, and India’s Plastic Waste Management Amendment Rules, 2021, now enforce a ban on certain types of single-use plastics. The adoption of compostable packaging in the region is further driven by these regulations coupled with rising consumer awareness about sustainability.
  
• The North American compostable packaging equipment market is projected to witness lucrative growth opportunities, driven by stringent governmental environmental regulations, corporate sustainability initiatives, and increased consumer demand for sustainable packaging solutions. California and New York, among other states,  have banned single-use plastics and established composability standards. California’s SB 54 law, for example, would reduce plastic packaging by 25% by 2032. Global giants like Starbucks, Amazon, and Walmart are pouring dollars into sustainable packaging to meet their environmental goals. Consumers are increasingly opting for eco-friendly alternatives (especially in the food, beverage,  and e-commerce sectors). Automation in manufacturing is also making it easier for companies in North America to create compostable packaging, and those factors are contributing to overall growth within space.
  
• The market in post-consumer Europe of compostable packaging equipment is also a reaction to strict regulations, a high level of awareness among consumers, and technology innovation. Efforts like the European Union’s Green Deal and Single-Use Plastics Directive would cut down on plastic waste by encouraging sustainable alternatives. For instance, the EU aims for all packaging to be recyclable or reusable by 2030. These policies have incentivized industries to use compostable packaging, which necessitates the equipment to produce it. European customers are strongly eco-friendly conscious, pushing businesses to reach sustainability metrics. The region also spends a lot on research and development. Innovation in bioplastics and compostable materials is also supported through EU funding programs, including Horizon Europe. With leading manufacturers of packaging machines, Germany and Italy will lead the world in the development of advanced compostable packaging machines.
  

Compostable Packaging Equipment Market Share

GEA Group is a world-leading supplier of advanced extrusion systems, and we also produce thermoforming machines that is critical to the making of compostable packaging. It focuses on sustainability, material innovation, and a tailored approach to customer-specific application needs. Sacmi, which offers molding,  filling, and packaging equipment. It uses its global scale and research investment to improve technologies for sustainable packaging. It also works with bioplastic producers to develop new packaging solutions that are compostable.

Krones AG KRN, -0.42% produces production and packaging machines and specializes in smart automation and IoT that enhance production efficiency. Everything else they do is about recycling and composability, and they provide complete solutions to assist businesses with switching to compostable packaging.” Multivac is known for vacuum packing and tray-sealing machines, key for compostable materials. The company invests in research and closely cooperates with the material suppliers, ensuring its solutions for biodegradable and compostable materials are always up to date. The food that JBT Corporation provides includes the processing and packaging systems which are sustainable and healthy dinners. It aims to provide flexible, energy-efficient machines and localized equipment for compostable substances. These market leaders have chosen a path centered on sustainability, technology, and tailored solutions for businesses transitioning to eco-friendly packaging.

Compostable Packaging Equipment Market Companies

Major players operating in the compostable packaging equipment industry are:

• Amcor
• Ball
• BASF
• Berry Global
• Biome Bioplastics
• BioBag
• Braskem
• Corbion
• EcoEnclose
• International Paper
• Mondi
• Placon
• Smurfit Kappa
• Tetra Pak
• WestRock
  

Amcor manufactures flexible packaging and equipment such as thermoformed and film extrusion machines to make composable films and packaging. Ball emphasizes recyclable materials and not compostable packaging equipment but prioritizes sustainability in its manufacturing process. BASF provides manufacturers with raw biodegradable materials like ecovio, which they use to produce compostable packaging on machinery such as extruders and injection molders. Berry Global provides machinery for producing compostable films and bags based on extrusion and thermoforming technologies. Creative Biodegradables: They make biodegradable materials for packaging by using molding and extruding equipment. Their biodegradable materials are processed with molding and extruding equipment. Film extruders and bag-making machines are used by BioBag to produce compostable bags.

Compostable Packaging Equipment Industry News

• In February 2025, TIPA, the world's leading company when it comes to compostable packaging innovation, this week presented a new phase in the world of ever-advancing home compostable metalized high-barrier film. Packaging challenges in eco-friendly chips and salty snacks are addressed with a biodegradable solution that packs functionality and durability. The launch comes at a time of increasing demand for sustainable snack packaging, with the global market set to grow at a rate of above 5% over the next five years.
  
• In November 2024, UPM and Eastman released a recyclable paper-based food pack with compostable coating. UPM Specialty Papers and Eastman have developed a grease and oxygen barrier pack for food purposes with a compostable, biopolymer coating.
  The solution builds on Eastman’s biobased and compostable Solus performance additives and BioPBS polymer to create thin deposits onto UPM’s compostable and recyclable barrier base papers. The coating layer is so thin, according to the companies, that the solution is “targeted for recycling” to facilitate recycling in existing fiber recycling streams.
  
• In January 2024, the new SEE CRYOVAC® brand compostable overwrap tray is made from biobased, food contact grade resin, USDA-certified as chemically derived biobased content containing 54% renewable wood cellulose. The tray, which will biodegrade into organic material with no toxic residue, is designed to replace expanded polystyrene, or EPS, trays that traditionally package fresh poultry and red meat for consumer purchase but cannot be recycled or biodegraded.
  

The compostable packaging equipment market research report includes in-depth coverage of the industry with estimates & forecasts in terms of revenue ($ Mn/Bn) and Volume in Thousand Units from 2021 to 2034, for the following segments:

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Market, By Equipment Type

• Extruders
• Film blowing machines
• Printing presses
• Cutting machines
• Sealing machines
• Others

Market, By Materials

• Plant-based fibers
• Paper & cardboard
• Cornstarch
• Bamboo
• Others

Market, By Packaging Type

• Flexible packaging
• Rigid packaging
• Cutlery & accessories
• Paper-based packaging

Market, By Automation Grade

• Automatic
• Semi-automatic
• Manual

Market, By Power Source

• Electric-powered equipment
• Gas-powered equipment
• Diesel
• Hybrid

Market, By End Use

• Food & beverage packaging
• Retail & consumer goods
• Healthcare & personal care
• E-commerce & shipping
• Agriculture & horticulture
• Others

Market, By Distribution Channel

• Direct
• Indirect

The above information is provided for the following regions:

• North America
  • U.S.
  • Canada 
• Europe
  • UK
  • Germany
  • France
  • Italy
  • Spain
  • Russia
  • Nordics
• Asia Pacific
  • China
  • India
  • Japan
  • Australia
  • South Korea
  • Southeast Asia
• Latin America
  • Brazil
  • Mexico
  • Argentina
• MEA
  • UAE
  • South Africa
  • Saudi Arabia