Compostable Packaging Market Report 2025

This Compostable Packaging market report provides a comprehensive analysis of the market’s characteristics, size, and growth, including segmentation, regional and country-level breakdowns, competitive landscape, market shares, trends, and strategies. It also tracks historical and forecasted market growth across various geographies.

The compostable packaging market size has grown strongly in recent years. It will grow from $92.56 billion in 2024 to $100.44 billion in 2025 at a compound annual growth rate (CAGR) of 8.5%. The growth in the historic period can be attributed to increasing consumer awareness about environmental impact, the regulatory push towards reducing plastic waste, the rise of bio-based and renewable feedstocks for packaging materials, the growth of sustainable and eco-friendly product trends, and corporate sustainability initiatives and goals.

The compostable packaging market size is expected to see strong growth in the next few years. It will grow to $137.26 billion in 2029 at a compound annual growth rate (CAGR) of 8.1%. The growth in the forecast period can be attributed to stricter regulations on plastic use and waste management, rising demand for sustainable packaging solutions from industries, increasing advancements in compostable packaging materials, growing food and beverage industry, and increasing investment and innovation in circular economy solutions. Major trends in the forecast period include expansion of composting infrastructure and facilities, integration of IoT and smart packaging in compostable products, advances in compostable materials technology, adoption of compostable packaging in e-commerce and food delivery sectors and shift towards multi-layer compostable films for better functionality and barrier properties.

The growth of the compostable packaging market is expected to be driven by the expanding food and beverage industry. This sector encompasses the production, processing, distribution, and sale of food and drinks, catering to the rising global population and evolving consumer preferences for healthier and more convenient options. Innovations in product development and distribution channels further contribute to the industry's growth. Compostable packaging plays a crucial role in this sector by addressing plastic pollution concerns, meeting consumer demand for eco-friendly products, and complying with regulations promoting sustainability. For example, a report from Statistics Sweden in September 2022 indicated that food and beverage sales revenue reached $37.44 billion (SEK 334 billion), driven by a 2.9% increase, with sales volume rising by 2.5% and prices slightly increasing by 0.4%. This growth underscores the role of the food and beverage industry in fostering the compostable packaging market.

Leading companies in the compostable packaging market are focusing on creating technologically advanced products, such as flexible compostable packaging solutions, to improve the performance and sustainability of their offerings. These compostable flexible packaging solutions are made from sustainable, biodegradable materials that naturally decompose, reducing environmental impact while maintaining product quality and extending shelf life. For example, in September 2024, Pakka, a Switzerland-based company specializing in sustainable, compostable packaging solutions, introduced a new line of flexible compostable packaging designed specifically for the Fast-Moving Consumer Goods (FMCG) industry. This product range includes three distinct options tailored for the transportation of premium food items.

In May 2023, TIPA Corp., an Israel-based manufacturer specializing in compostable packaging, acquired Bio4Pack to enhance its portfolio with Bio4Pack's expertise in sustainable packaging solutions. Bio4Pack, based in Germany, produces compostable packaging products, including paper packaging made from agricultural waste, trays, and nets.

Major companies operating in the compostable packaging market are BASF SE, Mitsubishi Chemical Corporation, WestRock Company, International Paper Company, Amcor Plc, Smurfit Kappa, Stora Enso, DS Smith, Mondi Plc, Rengo Co. Ltd, Huhtamaki Oyj, Klabin SA, Clearwater Paper Corporation, Holmen Iggesund, Carvajal Empaques S.A., Vegware Ltd., NatureWorks LLC, Plantic Technologies Ltd., Novamont SpA, SmartSolve LLC, TIPA Corp., Biome Technologies Plc, Total Corbion PLA BV, Reyma Oficial, Ultra-Green Packaging Inc.

North America was the largest region in the compostable packaging market in 2024. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the compostable packaging market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the compostable packaging market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

Compostable packaging refers to materials and products designed to break down into natural elements in a compost environment, leaving no toxic residue and contributing to reducing waste and environmental impact compared to traditional packaging materials.

The main compostable packaging materials include polylactic acid (PLA), wheat straw fiber, talc-filled polylactic acid (TPLA), crystallized polylactic acid (CPLA), cellulose, bamboo, polyhydroxyalkanoate (PHA), and others. Polylactic acid (PLA) is a biodegradable plastic derived from renewable resources such as corn starch or sugarcane. It is used in various forms including bags, pouches, trays, tapes, mailer bags, films, and clamshells, and finds applications across industries such as food and beverages, pharmaceuticals, personal care, cosmetics, and others.

The compostable packaging market research report is one of a series of new reports that provides compostable packaging market statistics, including compostable packaging industry global market size, regional shares, competitors with a compostable packaging market share, detailed compostable packaging market segments, market trends and opportunities, and any further data you may need to thrive in the compostable packaging industry. This compostable packaging market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

The compostable packaging market consists of sales of food containers and takeout boxes, utensils and cutlery, and garment bags. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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