Compostable Packaging Market
Get a free sample of this report
Your inquiry has been received. Our team will reach out to you with the required details via email. To ensure that you don't miss their response, kindly remember to check your spam folder as well!
Form submitted successfully!
Error submitting form. Please try again.
Request Sectional Data
Your inquiry has been received. Our team will reach out to you with the required details via email. To ensure that you don't miss their response, kindly remember to check your spam folder as well!
Form submitted successfully!
Error submitting form. Please try again.
The global compostable packaging market was valued at USD 80.5 billion in 2024 and is estimated to grow at a CAGR of 7.6% from 2025 to 2034. The growing awareness of environmental issues in addition to regulatory obligations is encouraging investment in sustainable packaging materials. These eco-friendly products that include recyclable, compostable and biodegradable materials fit consumer needs, thus encouraging innovation and investment in them, which in turn promotes market growth.
For instance, in November 2024, UPM Specialty Papers together with Eastman launched biopolymer-covered paper, a compostable packaging that offers better oxygen and grease barriers for food products. The biopolymer-coated paper uses Eastman's bio-based Solus additives in combination with barrier-based papers. This alternative packaging solution uses a thin or ultra-thin coating that is easy to compost but allows it to be recycled in existing fiber recycling systems. The UPM Solide Lucent and UPM Prego barrier base papers benefit from the coating, improving the barrier performance that would not be achieved individually.
| Report Attribute | Details |
|---|---|
| Base Year: | 2024 |
| Compostable Packaging Market size in 2024: | USD 80.5 Billion |
| Forecast Period: | 2025-2034 |
| Forecast Period 2023 - 2032 CAGR: | 7.6 |
| 2023 Value Projection: | USD 168.1 Billion |
| Historical Data for: | 2022 - 2024 |
| No of Pages: | 520 |
| Tables, Charts & Figures: | 688 |
| Segments Covered: | Material, Product, Application, End-use Industry |
| Growth Drivers: |
|
| Pitfalls Challenges: |
|
A key trend in the compostable packaging industry are bioplastics such as polyhydroxyalkanoates (PHAs) which are industrially compostable, non-toxic and free of any microplastics generation. Such progress reflects the current consumer trend towards green alternatives that have good utility and easy use. Companies invest in innovative materials and technologies to develop effective, durable, and recyclable products that meet consumers' increasingly demanding preferences for the environment, gradually changing the landscape of packaging that is user-friendly and environmentally friendly. For instance, in October 2024, Genecis Bioindustries introduced Mad Tea, a brand that sells compostable tea containers for Nespresso machines. These tea bags are made of PHA-based bioplastics that is eco-friendly, non-toxic and microplastic. Mad Tea specializes in the production of tea and makes fast and vegan tea that is lactose-free while maintaining a bold taste and sustainability.
Higher production costs are the other significant challenge in the compostable packaging industry. Eco-friendly materials require specialized raw inputs, advanced technology, and research, which makes them costlier than regular plastic packaging. The increase in costs may discourage small companies from adopting compostable alternatives because of high costs of creating such environment-friendly materials. Thus, on the large-scale application, customers will be charged higher for sustainably packaged products, which might limit acceptance. The increase in production costs will continue to be a major challenge and to overcome this will require innovations in production processes, subsidies, and investments to enable migration to more efficient operating models.
The growing focus on eco-sustainability among consumers provides scope and market for the introduction of compostable packaging. Since eco sustainability is an important consideration for consumers, companies offering compostable packages should take note of it. This helps differentiate the product so that customers are loyal to the brand, and regardless of price positioning, then the brand can be used to indicate the strength of competitive advantage in the market.
Based on material, the compostable packaging market is divided into polylactic acid (PLA), cellulose, bamboo, wood, and polyhydroxyalkanoate (PHA). The polylactic acid (PLA) segment is expected to reach a value of over USD 55 billion by 2034.
Based on product, the market is divided into bags & pouches, trays & plates, films & wraps, cups & bowls, and others. The films & wraps segment is the fastest growing segment with a CAGR of over 9% between 2025 and 2034.
North America held a significant share of over 30% in the global compostable packaging market. In the US market for compostable packaging, we see growth in expansion. This is due to increased consumer awareness and regulatory concerns related to technology. Industry is attempting to comply with regulatory requirements for eco packaging. In addition, research and development in compostable materials and investments in eco-friendly technologies accelerate the pace of adoption across industries, increasing the scope of market growth.
The Chinese Government targets the compostable packaging industry and offers incentives for research aimed at evaporating increasing plastic waste. The country is characterized by a large population and rapid urbanization, which increases the demand for environmentally safe packaging. New manufacturers are looking to buy new materials that have never been used before and joint ventures with international companies are developing technologies for the production of compostable materials.
The market for compostable packaging in India is on the rise due to greater environmental awareness and government support. The Government of India has launched a campaign promoting the use of compostable substitutes as an alternative campaign to single-use plastics. In addition, established and new start-up companies are involved in the production of environmentally friendly goods that serve the growing desire for environmentally friendly goods.
The South Korean compostable packaging market continues to grow year after year primarily because of the policies concerning waste management and environmental culture. The government fully supports green technology by pushing for research and development that has resulted in local companies shifting towards a greener direction. This comes in line with the needs of consumers who favor green products.
The strategy that Japan is employing for sustainable development, and technology is the driving force behind the expansion of the country in the market. There are higher principles of the circular economy that have encouraged companies to use green packaging. The joined efforts by the public institutions, research institutions, and the business sector are responsible for producing and spreading compostable packaging that consumers can already buy.
Price, product innovation, sustainability and distribution are some of the important aspects that are responsible for competitiveness in the compostable packaging industry. Companies compete with affordable but top-quality compostable materials and focus on differentiation through eco-friendly solutions. Developing more functional and multipurpose packaging that is still able to decompose is important to strengthen the market by expanding the demand for environmentally friendly products. In addition, distribution channels are important, as companies seek collaboration with various big brands and retailers in order to improve the accessibility of sustainable packaging means.
Major players operating in the compostable packaging industry are:
Market, By Material
Market, By Product
Market, By Application
Market, By End-use Industry
The above information is provided for the following regions and countries:
North America held a significant share of over 30% in the global market, driven by heightened consumer awareness of environmental concerns and robust regulatory measures aimed at reducing plastic waste.
Major players in the industry include Amcor, Baroda Rapids, Biopac, Eurocell, Futamura Chemical, Genpak, Good Start Packaging, Graphic Packaging Holding, International Paper, Mayr-Melnhof Karton, Mondi, Pappco Greenware, Pactiv Evergreen, Sealed Air, TIPA, Ultra-Green Sustainable Packaging, Vegware, and WestRock.
The global market size for compostable packaging was valued at USD 80.5 billion in 2024 and is projected to reach USD 168.1 billion by 2034, driven by a CAGR of 7.6% from 2025 to 2034.
The polylactic acid (PLA) segment is expected to exceed a value of USD 55 billion by 2034, driven by its biodegradability and versatility in packaging applications.