The bioplastics chart below (from today's daily report) is interesting from a couple of perspectives, the first being whether the projections are reasonable and the second being the significance of the investments. We believe that the volume targets are optimistic, given the capital requirements and that many of the companies pursuing bioplastics are relatively new and need to borrow most or all of the capital needs. The volumes would be easier to believe if the participants were large companies with strong balance sheets. The second point is just how small the volumes are in the grand scheme of plastics. Global demand for plastics exceeds 300 million tons and consequently, the 2026 projection would account for only 2.5% of global polymer demand. Note that in the article (linked here) around the uptake of biodegradable plastics – in this case in the UEA – one of the constraints to growth listed is availability. The other constraint, which likely faces producers in all markets is consumer education. Introducing a new polymer – or range of polymers – into an already confusing mix will require consumer education around what is biodegradable and what to do with the material. This topic follows on from the recycling theme in last week's ESG and Climate Report.
We are focusing on one of the recycling headlines in today's ESG & Climate Report referencing a collaboration between Mars Wrigley and Danimer Scientific. The news release highlights two important issues – using biodegradable polymers where they are most fit for purpose, in this case, single-use candy wrappers – and the need for consumer education. We already have a confusing set of labels for polymers, as summarized in the image below, and adding biodegradable plastics, which would contaminate a recycle stream even further, requires a huge leap of faith that consumers can not only identify the products that can be composted but are willing to do so.