This Frost & Sullivan research service titled Strategic Assessment of the Bioplastics Market in Brazil and Mexico provides the current status of the market, highlighting forecasts, market trends, and an analysis for participants and end users. In this research, Frost & Sullivan's expert analysts thoroughly examine the following markets polylatic acids (PLAs), polyhydroxalkonates (PHAs), bio-based commodity plastics, starch-based plastics, and bio-based engineering plastics.

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Market Overview

Abundance of Raw Material and Low Cost Enhance Prospects for the Bioplastics Market in Brazil and Mexico

Both Brazil and Mexico are nascent markets for bioplastics, which are currently under pilot scales in several companies, penetrating segments, such as food packaging and agricultural films. However, large production scales in Brazil are expected to change the dynamics of the market in the region. With renewable raw materials at low cost and an established and qualified workforce made up of several research groups, Mexico and especially Brazil have a privileged position worldwide. Further, Brazil has the potential to become a global producer and exporter of biopolymers as financing and R&D activities are being streamlined by government agencies.

The abundance of feedstock for producing bio-based polymers in this region is enabled by its tropical climate, which aids the growth of crops, such as sugarcane in Brazil. This, in turn, translates into low production cost, which is particularly suited to the demands of the commodity plastics market. "Brazil is the leading producer of sugarcane in the world, having unbeatable production costs for this raw material," notes the analyst of this research service. "As sugarcane and ethanol production in Brazil is constantly increasing, this will be a competitive advantage for the country to expand bioplastics production based on ethanol." By 2015, large-scale units such as Braskem bio-based polyethylene and Solvay S.A. bio-based PVC are expected to be producing bioplastics. The Braskem bioplastics plant will be the largest in the world. Producers in other global regions will largely struggle to match Brazil in terms of its advantages on the feedstock front.

On the other hand, Mexico does not have local bioplastics production. The country is in the first stage of bioplastics development; there are several universities and research institutes working on finding new sources to produce bioplastic in higher volumes. There is actual bioplastics pilot production based on corn, seaweeds, and plane tree starch. At present, major applications are related to food packaging, food trays for fruits and vegetables in supermarkets, supermarkets bags, access cards, textiles and cosmetic packaging, but on a lower scale. The development of durable products, such as those in consumer electronics (laptop and mobile phone casings and others), in leisure (sporting shoes, ski boots, and so on), and in the automobile industry, is a trend for the future.

Although the prospects for the market are upbeat, there are some challenges reining in market progression. Currently, the level of awareness of using bioplastics in Brazil and Mexico is still very low. Bioplastics are still considered a niche market, with cost and performance issues to be solved before further growth can be achieved. In Brazil, a common trend is to reuse plastic bags as garbage bags. Despite providing returnable bags or boxes by supermarket chains, customers continue to prefer plastic bags, especially because these bags are offered free of cost. However, the public, governments, and private companies in these countries are finally recognizing increasing oil prices and the importance of climate change, leading to an increasing interest in bioplastics. The end-user base has to be educated according to what each of these products represents and the similarities and differences among them. Some bioplastics, such as NatureWorks PLA, have different grades in order to meet requirements in diverse industries, which could increase product awareness among end users. To ensure successful business outcomes in this market, participants must establish partnerships or alliances with the agro industrial sector, while maintaining cost competitiveness.

Market Sectors

Expert Frost & Sullivan analysts thoroughly examine the following market sectors in this research:

By End-user Vertical:

• Food / cosmetics packaging
• Consumer products
• Agriculture

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