Europe Biodegradable Packaging Market

Europe Biodegradable Packaging Market Outlook (2025 to 2035)

The Europe biodegradable packaging market is expected to reach USD 6,484 million by 2035, increasing from USD 3,214 million in 2024. During the forecast period (2025-2035), the industry is projected to register a CAGR of 6.7%.

The strict directives of the EU, such as the Single-Use Plastics Directive and the European Green Deal, are advancing the use of biodegradable materials across various European industries. The move toward sustainable packaging is gaining momentum due to growing environmental awareness, the pressure from millennials, and the development of bioplastics.

What are the drivers of Europe biodegradable packaging market?

Growing environmental awareness and vigorous local and European policies that are forcing an end to plastic waste are the main drivers of the Europe biodegradable packaging market. Both the Single-Use Plastic Directive and the European Green Deal of the European Union have motivated manufacturers to adopt a sustainable plastic solution. These new regulations are advancing industries towards the use of biodegradable materials, in the fields of food, beverages and retail markets.

The increase in demand has been driven by the fact that consumers, particularly millennials and Gen Z, are increasingly preferring green packaging. Starch, cellulose, and PLA-based bioplastics are experiencing rising popularity due to their lower carbon footprint. Market growth is further being fostered by innovations emerging in the field of materials science and circular economy projects launched by leading FMCG brands.

What are the regional trends of Europe biodegradable packaging market?

Western Europe continues to be the leader, with countries such as Germany, France, and the UK being particular market leaders in terms of well-developed recycling facilities and strict laws that encourage the use of biodegradable packaging. Germany, in particular, is a strong proponent of R&D on biopolymers and requires its packaging laws to be environmentally friendly in the retail and food industries.

In Southern Europe, the emerging demand is driven by the tourism and hospitality sectors, resulting in increased packaging demand. Italy and Spain are promoting the use of compostable food containers and flexible films through investments in local composting infrastructure and cooperation with startups, particularly in cities and coastal locations.

Even at its relatively immature stage, Eastern Europe is gaining momentum. Poland, Hungary, and the Czech Republic are also implementing nationwide bans on single-use plastics and investing in green startups focused on bio-based packaging. Government financing with EU support and strategy convergence is stimulating biodegradable alternatives in the Eastern markets.

What are the challenges and restraining factors of Europe biodegradable packaging market?

The European biodegradable packaging market faces its own set of challenges, despite its significant growth. The low scalability of biodegradable materials relative to conventional plastics and high production costs limit their use to a few applications. Industrial composting infrastructure is still underdeveloped in various sectors in Europe, particularly in Eastern Europe.

Greenwashing and mislabeling practices lead to mistrust among consumers, and they are considered a threat to both regulatory and reputational risks. Additionally, broken-down packaging is typically stored under special conditions to break, but these conditions are not always present. The need to compete with recyclable plastics and the non-uniformity in the certification process also prevent the market from expanding.

Country-Wise Outlook

Germany leads with engineering prowess and circular economy vision

Germany has the largest domestic market in Europe, which is attributed to its robust industry, high-tech recycling system, and intensive circular economy policies. The plan of German companies to significantly shift towards biodegradable polymers and fiber-based products can be confirmed by the Packaging Act (VerpackG), which stipulates that all packaging must be recyclable and the use of materials must be minimized.

Leaders in the business, such as BASF and Südpack, are ramping up the bio-based packaging development, particularly in foodservice, e-commerce and cosmetics. Compostable plastic substitutes are emerging with innovations in PHA, PLA, and paper-laminate blends. New government programs, such as the Waste Prevention Program 2023 and the harmonization of EU countries with their Green Deal, continue to support the industry. Rapid scalability is also enabled by high automation of package lines.

France pushes market boundaries through regulatory muscle

France is moving forward rapidly with its strict anti-plastic policy, the AGEC Law, which prohibits the use of single-use plastics and promotes eco-design. This legislative spine is establishing a fertile ecosystem of compostable films, molded pulp trays and the development of packing material using seaweed.

The European Union and state subsidies are being allocated to French startups and small to medium-sized companies to accelerate the implementation of biodegradable packaging in both the retail and hospitality sectors. The increasing preference for eco-packaging among the general population, combined with the widespread availability of composting facilities, is also driving the process.

Italy harnesses agro-waste and industrial design for green packaging

Italy is a leader in the bio-economy, particularly in the conversion of agricultural waste into biodegradable materials. Italian laws require that certain types of products be replaced with more biodegradable alternatives, and EU-funded programs, such as Horizon Europe, drive pilot programs utilizing waste from the winery, olive oil, and tomato industries. Favorable local ingredients, a culture of purchasing artisanal and sustainable products, and a high sensitivity to design are enhancing the uptake in the high-end food industry and the luxury market.

Category-Wise Analysis

Paper and paperboards emerge as the backbone of eco-friendly material innovation

In the European biodegradable packages manufacturers, paper and paperboards are the most popular. They are massively used as people want alternatives to plastic and EU policies that deter the use of single-use plastics. The same materials are also in line with the principles of the circular economy and provide not only functional strength but also environmentally sound disposal, particularly in the field of food contact. Barrier coatings, moisture resistance are some of the technological advancements which further increase their applicability in the contemporary packaging requirements.

Trays drive versatility and convenience in sustainable food packaging

Trays make up high-necessity segment of biodegradable packaging because of their build, protective nature and the convenience of both processing companies and the customers. They are being applied more widely in the European situation in ready meals and bakery products and produce packaging. The use of paper-based trays is picking up pace in time when retailers and foodservice providers are turning into plastic containers. The fact that they adhere to the EU food safety standards and can be easily included into the compostable waste stream supports their popularity.

Food & Beverage industry steers demand with eco-conscious consumption trends

Food and beverage industry in Europe has become the main user of biodegradable packaging primarily due to regulatory pressure, sustainability commitments of large companies and consumers interest in clean-label, low waste packaging. As market trends are driven by such strategies as the EU Green Deal and Single-Use Plastic Directive, corporations are turning to biodegradable solutions more and more to win the perception market and minimize landfill reliance. The size and the level of innovation in this sector means that it is an important influencer in speeding up the acceptance of biodegradable packaging into the mainstream.

Competitive Analysis

The European packaging industry is one that is very dynamic with its targeted competition level that is influenced by the aspect of innovation and alignment to the regulations, as well as the aspect of differentiating the competitor based on their sustainability level. To remain compliant with the Circular Economy Action Plan and Single-Use Plastics Directive released by the EU, companies are targeting compostable materials composed of starch, Polylactic Acid (PLA) and cellulose. The strategic partnerships between the packaging manufacturers and food & beverage, personal care, and pharmaceutical industries are introducing customization of products and shorter product transition.

The rate of competition increases in the aspect of material innovations, where regional competitors put money into home-compostable and marine-biodegradable varieties. This is the case with R&D, particularly on bio-based polymers and barrier coating, as they are becoming key competitive advantages. Operation sustainability is another frontline, and particularly environmental-minded consumers favor companies that provide carbon-neutral manufacturing and localized delivery chains.

The increased competition by the use of private label packaging has also intensified competition through provision of effective alternatives of upper eco brand. There is also the pressure that is being applied in the market in terms of regulatory compliance and shortening of adaptation and certification cycles. With sustainability standards changing the differentiation game is gradually shifting toward the transparency of the impact and digital traceability solutions incorporated into packaging.

Key players in the Europe biodegradable packaging industry are Amcor Plc., Smurfit Kappa, Sealed Air, International Paper, Mondi Group PLC, Tetra Pak International S.A., DS Smith, Kruger Inc., Toray Plastics Inc., and other players.

Recent Development

• In June 2025, Versalis, the chemical subsidiary of Italian energy giant Eni, inaugurated a demonstration plant utilizing its new "Hoop" technology for recycling mixed plastic waste. This innovation transforms diverse plastic materials into feedstock suitable for producing new plastics, including those safe for food and pharmaceutical use. A full-scale Hoop plant is planned for Priolo, Sicily, with operations targeted to begin in early 2029. Eni intends to invest approximately USD 200 million by 2029 into the Priolo facility and other plastic recycling operations, as part of a USD 2 billion plan to restructure Versalis.
• In December 2024, the European Council adopted the Packaging and Packaging Waste Regulation (PPWR), marking the final step in the co-legislative procedure before its entry into force. The PPWR places significant emphasis on sustainable packaging solutions, recognizing the role of biobased and compostable plastics in reducing reliance on fossil-based materials and cutting greenhouse gas emissions.

Fact.MR has provided detailed information about the price points of key manufacturers of the Europe Biodegradable Packaging Market positioned across regions, sales growth, production capacity, and speculative technological expansion, in the recently published report.

Methodology and Industry Tracking Approach

Fact.MR provided a detailed regional analysis of the European biodegradable packaging market in 2025, considering the opinions of more than 2,100 verified professionals across 15 European regions. The respondents were involved in the separate production of compostable food service ware, the development of biopolymers, sustainable e-commerce packaging logistics, and regulatory convergence on EU-wide eco-labeling. All countries participating in the study relied on contributions from at least 60 experts in the fields of circular packaging systems, plant-based polymer innovation, and end-of-life compostability testing.

Between June 2024 and May 2025, the research identified several key developments, including the commercialization of marine-safe film technology, the emergence of dual-layered cellulose packaging in the perishable food industry, stricter certification requirements for composting, rigorous labeling standards for biodegradable materials, and closed-loop recovery programs. There was an explosive demand at the regional level in shelf-stable compostable wraps, high-barrier bio-containers, and home-compostable mailers specifically designed to facilitate cold-chain fulfillment and consumer electronics.

In 2018, Fact.MR monitored the category of biodegradable materials by evaluating the maintenance of fiber-related integrity, moisture resistance criteria, and polymers used under industrial composting aspects. The recent analysis supports a radical shift in the market toward biomaterial traceability, low-carbon manufacturing, and regenerative packaging systems. The rising definition of the biodegradable packaging category is no longer aligned with the definition of a premium that relies on verifiable environmental attributes, packaging intellect, and design-to-disassemble ideas.

Segmentation of Europe Biodegradable Packaging Market

• By Material Type :

  • Paper and Paperboards
    • Coated Unbleached Kraft Paperboard
    • Bleached Paperboard
    • Molded Fiber Pulp Paperboard
    • Recycled Paper Paperboard
  • Plastic
    • Poly Lactic Acid (PLA)
    • Polyhydroxybutyrate (PHB)
    • Starch Based Plastic
    • Fossil Based Polymer (PCL, PBAT, PBS etc.)
    • Polyhydroxyalkanoates (PHA)
  • Jute
  • Wood

• By Application :

  • Trays
  • Bags
  • Boxes
  • Clamshells
  • Films
  • Pouches

• By End Use Industries :

  • Food & Beverage Industry
  • Cosmetics and Personal Care Products Industry
  • Pharmaceuticals Industry
  • Consumer Goods Industry

• By Region :

  • North America
  • Latin America
  • Western Europe
  • Eastern Europe
  • East Asia
  • South Asia & Pacific
  • Middle East & Africa