The biodegradable materials industry is rapidly emerging.

The company currently operates 150 bamboo straw production lines, with an annual output of 2 billion bamboo straws—enough to replace 2 billion plastic straws and reduce carbon dioxide emissions by more than 60,000 metric tons. By 2030, bamboo straw production is projected to reach 30 billion units, resulting in a reduction of 1 million metric tons of CO2 emissions.

In October 2023, the National Development and Reform Commission, the Ministry of Science and Technology, and other departments issued the Three-Year Action Plan for Accelerating the Development of “Bamboo-for-Plastic” Initiatives, which sets out the goal of establishing a preliminary “bamboo-for-plastic” industrial system by 2025. Compared with the previous year, the overall scale of the industry is expected to remain broadly stable relative to 2022; the comprehensive added value of key “bamboo-for-plastic” products is to increase by more than 20%, and the comprehensive utilization rate of bamboo resources is to rise by 20 percentage points. At the same time, “bamboo-for-plastic” products will be included in the scope of government procurement support, with efforts to expand the scale of such procurement. Public institutions and other entities are encouraged to actively procure relevant “bamboo-for-plastic” products.

The product catalog covers seven major categories of daily-use items, including bamboo casings, bamboo stationery, bamboo bath products, bamboo furniture, disposable bamboo tableware, durable bamboo tableware, and bamboo biodegradable bags, as well as 53 types of industrial materials and 5 types of construction materials.

As China continues to implement bans and restrictions on plastics, the development of plastic alternatives has become an unavoidable challenge. To address this, China is actively promoting research and development of biodegradable tableware made from plastic substitutes, thereby encouraging the substitution of conventional plastic products. At the same time, leveraging our abundant bamboo resources, we are vigorously advancing the initiative to “replace plastic with bamboo.”

According to publicly available information from the National Forestry and Grassland Administration, China’s bamboo forest area currently exceeds 100 million mu. By 2023, the output value of the bamboo industry is projected to surpass RMB 500 billion, with an average annual growth rate of over 30%. By 2035, the industry’s output value is expected to exceed RMB 1 trillion. At present, bamboo forests nationwide sequester 197 million tons of carbon annually while fixing 105 million tons of carbon. If the world were to replace 600 million tons of plastic products with bamboo each year, it could reduce CO₂ emissions by an estimated 4 billion tons. In addition to substituting bamboo for finished products, efforts are also underway to replace plastic raw materials with bamboo-based alternatives. Currently, mainstream substitution approaches using corn starch and plant fibers have been widely adopted in applications such as plastic bags and biodegradable food containers, helping to address the challenge of plastic degradation.

According to a report by the China Research Institute, driven by the ongoing strengthening of plastic restriction policies, total market demand for biodegradable plastics in China is projected to reach 4.4 million tonnes by 2025—more than nine times the level in 2018. At a unit price of RMB 20,000 per tonne, the resulting market value would approach RMB 90 billion.

Regional Development Bets on the Plastic Reduction Industry, Cautious of Overcapacity in Low-End Production

According to reports, Dongguan, along with Sichuan, Shouguang in Shandong, Bengbu in Anhui, Taiyuan in Shanxi, and other regions, are currently building or have already established specialized industrial clusters for bio-based new materials, focusing on developing platform compounds, bio-based plastics, bio-based fibers, and other related products, thereby forming an industry system centered around these key sectors.

Prior to 2019, the production and sales of biodegradable plastics in China grew at a slow pace. However, with the implementation of the second edition of the “Plastic Ban” in 2020 and the advancement of the “Dual Carbon” policy, the growth rate of biodegradable plastic production and sales in China has increased markedly.

According to reports by China Research and PwC, in 2021 China’s production and sales of biodegradable plastics reached 302,000 tonnes and 276,000 tonnes, respectively—representing year-on-year growth of more than 20%. It is projected that the total capacity under construction will exceed 4 million tonnes per year. At the same time, the report notes that, at present, the range of available biodegradable plastic grades and their cost-effectiveness still fall short of those of conventional plastics, thereby limiting the scope of applications for biodegradable plastics. Furthermore, in light of the requirements set forth in the second edition of the “Plastic Ban” to prohibit or restrict the production, sale, and use of certain plastic products, if the planned 4 million tonnes per year of biodegradable-plastic capacity is brought online as scheduled, future demand will likely surpass even the most stringent policy mandates for the use of biodegradable plastics, leading to overcapacity by the end of the 14th Five-Year Plan period.

Meanwhile, the report indicates that the global market for biodegradable plastic substitutes remains in its early stages of development, with significant room for improvement in market penetration. Notably, fossil-based plastics still hold the largest market share at 75%, while biodegradable plastics account for only 1%, leaving substantial untapped market potential.