Domestic demand for disposable tableware, plastic bags, agricultural films, and packaging materials

There is huge demand for biodegradable plastics in China. The four major application areas of disposable tableware, disposable plastic bags, agricultural mulch and packaging plastic film have a total potential demand of about 10.17 million tons. The global penetration rate of biodegradable plastics is generally below 3%, and China's penetration rate is only 0.62%.

According to Tianfeng Securities data, the current market demand for degradable plastics in my country is 42,000 tons. After the policy is fully implemented, the demand in the three fields of takeout, express delivery, and agricultural film alone will reach 1.5453 million tons, corresponding to a degradable plastic market of about 27 billion yuan, and the market growth space is 36 times. Industry insiders said that the market demand of 1.5453 million tons is only the increase in the short term after the implementation of the new policy, which is far from reaching the ceiling of degradable plastics. In the long run, there is a market space of hundreds of billions for degradable plastics.

According to the forecast of the market demand for degradable plastics from 2020 to 2025 by Liansu.com, the total consumption of degradable plastics will reach 640,000 tons in 2020 and 2.38 million tons in 2025, and the corresponding total output value of degradable plastics will reach 12.8 billion yuan and 47.7 billion yuan respectively. The future market prospects of degradable plastics are very broad.

The main raw materials of mainstream biodegradable plastics are PLA and PBAT. PBAT is a petroleum-based biodegradable plastic with a relatively mature industrial chain, good performance and economy. It is one of the most widely used biodegradable materials in the current research of biodegradable plastics.

Kingfa Technology has a PBAT production capacity of 60,000 tons/year and was put into production in 2011. Hengli Petrochemical's subsidiary 33,000 tons of PBAT/PBS biodegradable polyester new material project was successfully started up in December 2020. Ruifeng High-tech's 60,000 tons per year biodegradable polymer material PBAT (Phase I) project is expected to be tested in August 2021.

Tongcheng New Materials will build a 60,000-ton PBAT factory in Shanghai. Donghua Technology announced on March 18 this year that it plans to invest in a 100,000-ton PBAT project. Other listed companies that have or plan to invest in PBAT projects include Wanhua Chemical and Mogao Shares.