Bio-based PE is used in packaging applications such as carry bags, plastic films and bottles. Volatile prices coupled with limited availability of crude oil are expected to force polymer manufacturers to develop bio-based alternatives including bio-based PE. In addition, renewable nature of bio-based PE makes it an eco-friendly substitute to chemical counterparts which are expected to augment market demand over the forecast period.
Growing focus on sustainable packaging is expected to be a key factor for bio-based PE demand over the next six years. Stringent regulations including the Montreal &Kyoto Protocol issued by regulatory bodies such as EPA and EC (European Commission) aimed at reducing GHG emission is expected to propel demand for bio-based PE.. Uncertain availability of sugarcane as a raw material on account of its increased application in food & beverage industry is expected to negatively impact market growth over the next six years. Emergence of substitutes such as bio-based PET, PLA and PEF in packaging is expected to hamper bio-based PE market growth over the forecast period. Technological advancement in hydraulic fracturing has resulted in increased shale gas supply as a feed stock for polymer manufacturing thereby reducing prices. This development is expected to result in polymer manufacturers preferring low cost shale as raw material for PE manufacturing which could hamper bio-based PE market growth.
Bio-based PE market growth in Europe can be attributed to the stringent European Commission regulations intended for restricting GHG emission. Montreal Protocol adoption in U.S. and Canada is expected to fuel bio-based PE demand as an eco-friendly packaging product in North America. Asia Pacific is expected to witness growth owing to Japanese government’s commitment of 20% bio-based plastics consumption by 2020.. Application growth in automobile, consumer goods and food & beverages industry in Brazil and South Africa is expected to positively impact RoW market growth. Positive outlook on the sugar and ethanol industry in Brazil expected to ensure raw material availability for bio-based PE production. Braskem was the largest bio-based PE manufacturers, accounting for 28% of global production capacity in 2011. Other market participants include Mitsui, Dow Chemical, and Toyota Tsusho.
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