Northbrook, IL 60062 -- (SBWIRE) -- 04/25/2022 -- The global lactic acid market size is estimated to be valued at USD 1.1 billion in 2020 and is projected to reach USD 2.1 billion by 2025, recording a CAGR of 12.8%, in terms of value. The global polylactic acid market size is estimated to be valued at USD 786 million in 2020 and is projected to reach USD 1,756 million by 2025, recording a CAGR of 17.4%, in terms of value.

In recent years, the use of lactic acid in biodegradable polymers is growing significantly, mainly due to the rise in awareness among consumers and increased consumption of biodegradable plastic packaging in the food application segment. With the advancement of new technologies, the usage of lactic acid in the food and beverage sector helps in preventing the degradation of food quality. The Asia Pacific region is growing fastest owing to new technologies, government support, and an increase in the export of food and beverages.

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Market Dynamics:

Drivers: High demand for lactic acid and polylactic acid end-user applications

The market for lactic acid & polylactic acid has witnessed emerging trends in recent years, and this is evident from the innovations and developments taking place in various end-user applications, such as biopolymer, food & beverages, packaging, personal care & cosmetics, and pharmaceuticals. The biodegradable polymers industry has registered a significant demand, particularly in the North American and European regions, due to the rise in awareness among consumers about the polymers produced using polylactic acid. Food packaging manufacturers are already focusing on substituting with polylactic acid (PLA) for general-purpose packaging applications, such as trays and yogurt cups. These have been the common alternatives for takeaway food packaging.

According to a study published by the European Bioplastics (an association representing the interests of the thriving bioplastics industry in Europe) in collaboration with the nova-Institute (Germany), the global bioplastics production capacity is estimated to increase from nearly 2.11 million tons in 2018 to approximately 2.62 million tons in 2023. However, the study also stated that bioplastics represent nearly 1% of the 335 million tons of plastic produced annually. Packaging remains the largest field of application for bioplastics, accounting for nearly 65% (1.2 million tons) of the total bioplastics market in 2018. Innovative biopolymers, such as PLA (polylactic acid) and PHAs (poly-hydroxyalkanoates), are projected to be the key factors driving the growth of the bio-based and biodegradable plastics industry. The rise in demand for advanced biopolymers, end-user applications, and innovative products is a key factor that is projected to drive the market growth during the forecast period.

Restraints: Fluctuation in raw material prices restraints market growth

Lactic acid & polylactic acid offer a 75% reduction in carbon footprint as compared to the most traditional fossil-based plastics. They are obtained from renewable feedstocks, such as sugarcane, corn, sugar beet, and cassava. The biodegradation process for polylactic acid is relatively fast in industrial composting processes and takes longer for completion in less biologically-active environments. Besides composting, polylactic acid bioplastics also offer additional end-of-life options, such as mechanical and chemical recycling. Major players, such as Corbion (Netherlands), are using European sugar beet and Thai sugarcane as raw material feedstock for the production of lactic acid, which is used to produce bioplastics. However, raw material prices for the production of lactic acid have been volatile for the past several years. A significant rise in costs for commodities (raw materials used for lactic acid production, such as sugarcane, corn, sugar beet, and cassava) has posed as a major restraint for the market growth. The lactic acid and polylactic acid markets are projected to be influenced by the fluctuating prices of commodities during the forecast period.

The production costs are witnessing a significant increase due to the higher costs of raw materials, transportation, energy consumed, and chemicals, which leads to a reduction in margins for manufacturers. Thus, resulting in high end-user application prices. For instance, most manufacturing companies are increasing their prices worldwide for product categories that include lactic acid and lactates due to a rise in the costs of raw materials. Moreover, one of the significant restraints influencing the market growth for lactic and polylactic acid is the regulation pertaining to the number of bacteria generating the acid by optimizing and controlling metabolic activity.

Opportunities: Multi-functionalities of lactic acid and polylactic acid

Lactic and polylactic acids play an important role as a catalyst in the processing of several industrial products. These acids have typically been used as bulk industrial applications, such as food & beverages, biopolymers, textiles, packaging, and personal care & cosmetics. The market for lactic acid has witnessed significant growth as it is increasingly used as a substitute for toxic chemicals and plastics, particularly in food & beverages and pharmaceuticals. The application of polylactic acid also witnesses a rise in demand for biopolymers and as ingredients in personal care & cosmetic products.

In the food & beverage industry, lactic acid is preferred over synthetic chemicals, as they alter the flavor, texture, or characteristics of products to increase their shelf life. In the dairy industry, lactic acids are used to coagulate milk and produce cheese flavors. Whereas in the brewing industry, lactic acid improves starch conversion in beer, thereby increasing the yield. In the baking industry, lactic acid help in controlling the acidity of the dough and improving the shelf life of baked goods. Major uses of lactic acid in the food industry are found in cheese manufacturing, baking, confectionery manufacturing, processed meat, and vegetable processing.

Biodegradable and industrially compostable in nature, polylactic acid is among the first renewable polymers that were able to compete with the existing polymers, combining their functional characteristics, such as transparency, gloss, and stiffness. Polylactic acid is currently used in a wide range of industries, such as food packaging, single-use tableware, textiles, oil & gas, electronics, automotive, and 3D printing. Due to the various and versatile uses of lactic acid across industries, as well as the multi-functionalities of lactic and polylactic acids, the market is projected to witness significant growth opportunities during the forecast period.

Challenges: Lack of process-specific technology for the usage of lactic acid in developing countries

According to a study published by the National Center for Biotechnology Information (NCBI) in 2019, the production of biodegradable polymers as an alternative to petroleum-based plastics has gained significant traction in the previous years. Polylactic acid is considered a preferred alternative as a significant component in various applications, ranging from food packaging to pharmaceuticals. The study also states that D-lactic acid plays a significant role in the production of heat-resistant polylactic acid. Moreover, the utilization of renewable resources has been imperative for the decrease in production cost.

The lactic acid and polylactic acid market is highly consolidated in emerging markets in Asia, Africa, and South America. The usage of lactic and polylactic acids in small & medium enterprises has been a challenge due to the lack of resources or the technology and facilities required for the extraction and fermentation of high-quality lactic acid and polylactic acid. Moreover, the selection of the right composition of lactic acid is a key aspect that many companies have not figured out accurately. This selection plays a crucial role in sustaining the flavor and texture of food & beverage applications. The selection of the right composition of lactic acid is a complex method that requires validation at a laboratory and factory-scale level. The lack of awareness among experts on the polylactic acid extraction from lactic acid could lead to high production losses. Hence, these factors are projected to pose major challenges that inhibit the growth of the lactic acid and polylactic acid markets. Adequate training provided to professionals on product functions and characteristics could help manufacturers attain the desired quality in their end-products with minimal production losses. Thus, the lack of proper technology and knowledge also poses a challenge for the use of lactic and polylactic acids in developing regions.

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'North America is accounted the largest share in the market for the lactic acid'

The North America accounted for the largest share in the global lactic acid market in terms of value. The North American lactic acid market is entirely driven by the growth of the US market. The North American market is regulated, with the US Environmental Protection Agency (EPA) playing a key role in the monitoring and commercialization of chemical products. In recent times, the rise in environmental concerns and waste management issues have led to a shift in the focus of consumers toward sustainable and environment-friendly plastics, particularly for packaging. Due to these factors, regulatory authorities, such as EPA, are increasingly opting for biodegradable plastics and focusing on increasing consumer awareness regarding the need for the use of biodegradable products.

Key Market Players:
Corbion (Netherlands), DuPont (US), Cargill (US), Galactic (Belgium), DOW (US), Unitika (Japan), Henan Jindan Lacic Acid Technology (China), Sulzer (Switzerland), Mushashino Chemical (Japan), Vigon International (US), Henan Xinghan Biology Technology (China), Danimer Scientific (US), COFCO BioChemical (China), Jungbunzlauer (Switzerland), FoodChem International (China), Vaishnavi Biotech (India), Spectrum Chemicals (US), Godavari Bio-refineries (India), ProAgro GmbH (Austria), and Qingdao Abel Technology (US) are the leading lactic acid and polylactic acid market vendors.

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