Compostable Packaging Market Report 2026

The compostable packaging market size has grown strongly in recent years. It will grow from $99.46 billion in 2025 to $107.28 billion in 2026 at a compound annual growth rate (CAGR) of 7.9%. The growth in the historic period can be attributed to growth in environmental awareness, rising restrictions on single-use plastics, early adoption by food service providers, expansion of organic product packaging, increasing availability of bio-based raw materials.

The compostable packaging market size is expected to see strong growth in the next few years. It will grow to $140.99 billion in 2030 at a compound annual growth rate (CAGR) of 7.1%. The growth in the forecast period can be attributed to increasing investments in composting infrastructure, rising demand from sustainable brands, expansion of regulatory mandates on packaging waste, growing innovation in compostable materials, increasing adoption in e-commerce packaging. Major trends in the forecast period include increasing adoption of bio-based packaging materials, rising demand for certified compostable products, expansion of food-grade compostable packaging, growing use of fiber-based alternatives, enhanced focus on sustainable packaging design.

The increasing food and beverage industry is expected to drive the growth of the compostable packaging market going forward. The food and beverage sector encompasses the production, processing, distribution, and sale of edible goods and beverages. Growth in this industry is fueled by rising global population, evolving consumer preferences for healthier and more convenient options, and continuous innovation in product development and distribution channels. Compostable packaging is increasingly essential to reduce plastic pollution, satisfy consumer demand for sustainable products, and comply with regulations promoting environmentally responsible practices. For instance, in July 2025, Agriculture and Agri-Food Canada, a government agency, reported that exports of processed food and beverage products reached a record value of $59.8 billion in 2024, up 3.8% from 2023, accounting for 34.5% of production value. Therefore, the growth of the food and beverage industry is driving the compostable packaging market.

Innovation is a key trend in the market, with companies developing advanced and eco-friendly solutions such as flexible compostable packaging to improve product protection and sustainability. Flexible compostable packaging is made from biodegradable materials designed to decompose naturally, minimizing environmental impact while maintaining product quality and shelf life. For instance, in September 2024, Pakka, a Switzerland-based sustainable packaging company, launched a new line of flexible compostable packaging solutions for the Fast-Moving Consumer Goods (FMCG) industry, offering three options tailored for transporting premium food products.

In May 2023, TIPA Corp., an Israel-based compostable packaging manufacturer, acquired Bio4Pack, a Germany-based producer of sustainable packaging products, including paper packaging from agricultural waste, trays, and nets. This acquisition enables TIPA to expand its sustainability leadership and broaden its product portfolio.

Major companies operating in the compostable packaging market are BASF SE, Mitsubishi Chemical Corporation, Amcor Plc, Smurfit Kappa, Stora Enso, DS Smith, Mondi Plc, Rengo Co Ltd, Huhtamaki Oyj, Klabin SA, Holmen Iggesund, Carvajal Empaques SA, Vegware Ltd, NatureWorks LLC, Plantic Technologies Ltd, Novamont SpA, 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 2025. 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, South East Asia, 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, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

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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