Compostable Shopping Bags Market Outlook

The global compostable shopping bags market is projected to reach USD 5 billion by 2035, growing at a CAGR of 12% from 2025 to 2035. This surge in market size is primarily driven by the rising consumer awareness regarding environmental sustainability and the detrimental effects of plastic pollution on ecosystems. Governments across the globe are increasingly implementing stringent regulations against single-use plastics, further propelling the demand for eco-friendly alternatives such as compostable shopping bags. Additionally, a shift in consumer behavior toward sustainable shopping practices is encouraging retailers to adopt compostable options, thereby expanding the market landscape. The growing trend of sourcing materials from renewable resources also fosters innovation within the sector, creating a ripe environment for growth.

Growth Factor of the Market

The growth of the compostable shopping bags market can be attributed to several key factors that are driving consumer and manufacturer interest alike. Firstly, the escalating concerns about plastic waste and its impact on the environment have prompted both consumers and businesses to seek sustainable alternatives, significantly boosting demand for compostable options. Secondly, advancements in material science have led to the development of high-performance compostable bags that meet the durability and usability standards of traditional plastic bags, further attracting consumers. Additionally, government regulations aimed at reducing plastic usage are enforcing businesses to transition to eco-friendly products, adding a new layer of urgency to the market. The increasing proliferation of e-commerce also plays a pivotal role, with online retailers looking for sustainable packaging solutions. Lastly, the rising trend of corporate social responsibility among businesses is driving investment in sustainable alternatives, further enhancing market growth.

Key Highlights of the Market

• The global compostable shopping bags market is projected to reach USD 5 billion by 2035, growing at a CAGR of 12% from 2025 to 2035.
• Governments worldwide are implementing regulations to phase out single-use plastics, significantly impacting market dynamics.
• Increased consumer demand for sustainable products is encouraging retailers to adopt compostable shopping bags.
• Advancements in material science have led to improved performance characteristics of compostable bags.
• The rise of e-commerce is driving the demand for sustainable packaging alternatives among online retailers.

By Product Type

Starch-based:

Starch-based compostable shopping bags are made from natural starches derived from crops such as corn, potatoes, and tapioca. The primary advantage of this type of bag is its biodegradability, as they break down into natural components in composting environments, reducing landfill waste. These bags are highly versatile and can be used for various applications, making them popular among eco-conscious consumers. Additionally, starch-based bags offer strength and flexibility comparable to traditional plastic bags, ensuring they serve effective packaging solutions. The increasing availability of raw materials coupled with consumer demand for sustainable alternatives is booming this segment.

PLA-based:

Polylactic Acid (PLA)-based compostable shopping bags are derived from renewable resources, typically cornstarch or sugarcane. PLA bags are known for their lower carbon footprint as they consume less energy during production compared to conventional plastic bags. Their clarity and aesthetic appeal make them an attractive choice for retailers looking to present a sustainable image. Furthermore, PLA bags are industrially compostable, meaning they can break down efficiently in commercial composting facilities. The growing interest in plant-based materials and sustainable options in retail has significantly propelled the demand for PLA-based bags in recent years.

PBAT-based:

Polybutylene Adipate Terephthalate (PBAT)-based bags are synthesized from fossil fuels but are designed to be biodegradable and compostable under appropriate conditions. PBAT bags possess exceptional flexibility and stretchability, providing an excellent alternative for various applications, particularly in the retail sector. Their ability to decompose in both industrial and home composting settings makes them a practical choice for consumers. Additionally, as awareness regarding biodegradable plastics increases, the acceptance and use of PBAT-based bags is expected to rise, contributing to market growth.

PHA-based:

Polyhydroxyalkanoates (PHA)-based bags are produced by microorganisms through the fermentation of organic materials. One of the key benefits of PHA is its complete biodegradability in both marine and soil environments, making it an excellent option for addressing plastic pollution. These bags are gaining traction as they offer similar mechanical properties to conventional plastics, making them suitable for various applications. As sustainability becomes a critical focus for both consumers and manufacturers, the demand for PHA-based shopping bags is expected to grow significantly in the coming years.

Paper-based:

Paper-based compostable shopping bags are made from sustainable paper sources, making them an eco-friendly alternative to plastic. These bags have gained popularity, especially among retailers focusing on reducing their environmental impact and catering to eco-conscious consumers. Additionally, paper bags can be recycled or composted, providing a versatile solution for waste management. Their robust structure makes them ideal for carrying heavier items, thus enhancing their practicality in retail environments. The push for sustainable packaging solutions is expected to drive further growth in the paper-based segment of the compostable bags market.

By Application

Supermarkets/Hypermarkets:

Supermarkets and hypermarkets represent a significant segment of the compostable shopping bags market, as these large retail stores require substantial quantities of bags to meet customer demands. The shift toward eco-friendly products is evident in the policies adopted by major supermarket chains, which are increasingly opting for compostable bags to replace their conventional plastic counterparts. These establishments are aware of their substantial carbon footprint and are actively seeking solutions to mitigate it. The volume of transactions in supermarkets and hypermarkets presents a lucrative opportunity for compostable bag manufacturers, with continuing efforts toward sustainability in the retail space.

Convenience Stores:

Convenience stores account for a notable share of the compostable shopping bags market due to their rapid checkout processes and smaller transaction sizes. These stores are often the first stop for consumers looking for quick purchases, and as such, they are interested in offering sustainable products as a point of differentiation. By adopting compostable bags, convenience stores not only contribute to environmental efforts but also attract eco-conscious customers. The unique positioning of convenience stores allows them to play a crucial role in influencing consumer behavior toward sustainable shopping habits.

Online Retailers:

Online retailers are increasingly adopting compostable shopping bags to cater to the growing demand for sustainable packaging solutions. As e-commerce continues to thrive, the need for efficient and environmentally friendly packaging options becomes paramount. Many online retailers are prioritizing sustainability as part of their corporate social responsibility initiatives, leading to an upswing in the use of compostable bags. The convenience of using lightweight compostable packaging that can be easily shipped also aligns well with the logistics of online retail. This trend is likely to continue as more consumers expect sustainable practices from their online shopping experiences.

Specialty Stores:

Specialty stores focusing on organic, local, or sustainable products are increasingly using compostable shopping bags to align their branding with eco-friendly practices. These stores cater to consumers who prioritize environmental considerations in their purchasing decisions, making compostable bags an ideal packaging solution. By offering compostable bags, specialty stores can enhance their image and attract customers who value sustainability. This segment is particularly sensitive to brand reputation and customer loyalty, and thus, the use of compostable bags is becoming a standard practice in this niche market.

Others:

The "Others" application segment includes various retail environments, such as farmer's markets, craft fairs, and events where sustainable practices are emphasized. As consumers become more aware of their environmental impact, demand for compostable bags in these settings has increased. Many organizers of such events are opting for compostable bags as part of their commitment to sustainability, which drives demand. This segment also serves as a platform for educating consumers about the benefits of using compostable products, fostering a culture of sustainability that can have long-term effects on purchasing behavior.

By Distribution Channel

Offline Stores:

Offline stores, including supermarkets, convenience stores, and specialty shops, represent a significant distribution channel for compostable shopping bags. The demand for sustainable packaging solutions is growing within these physical retail environments, as consumers increasingly seek eco-friendly alternatives while shopping. Offline stores are often positioned to provide immediate access to compostable bags to customers, allowing for impulse purchases driven by sustainability concerns. Retailers are also leveraging the opportunity to promote their commitment to environmental responsibility through the adoption of compostable bags, enhancing brand loyalty among environmentally-conscious consumers.

Online Stores:

Online stores are becoming an indispensable channel for the distribution of compostable shopping bags, driven by the expansion of e-commerce and increasing consumer preferences for sustainable packaging. Online retailers are not only selling compostable bags directly to consumers but also incorporating them into their shipping processes as a means to offer an eco-friendly alternative. The rising trend of subscription services and direct-to-consumer brands is further propelling the demand for compostable bags in online channels. As consumers seek out sustainable options, the competitive landscape of online retail is continuously adapting to meet these expectations, thereby augmenting the growth of the compostable shopping bags market.

By Material Type

Corn Starch:

Corn starch is one of the most popular materials used in the production of compostable shopping bags due to its renewable nature and biodegradability. The bags made from corn starch are highly efficient at breaking down in composting environments, offering a considerably lower environmental impact than traditional plastic bags. The versatility of corn starch allows for a variety of bag designs and sizes, making them suitable for different applications. With rising consumer awareness and the push toward sustainable products, the demand for corn starch-based compostable bags continues to grow, solidifying their position within the market.

Polylactic Acid:

Polylactic Acid (PLA) is a bioplastic derived from renewable resources, primarily cornstarch and sugarcane, making it a favored choice in the compostable shopping bags market. PLA bags offer a range of benefits, including excellent print quality and aesthetics, which makes them particularly appealing for retail applications. Additionally, PLA bags possess compostability in industrial settings, thus addressing both consumer and retailer preferences for sustainable packaging. The rising interest in plant-based materials and environmentally-friendly practices is driving the growth of PLA-based compostable bags, positioning them as a vital segment within the market.

Polybutylene Adipate Terephthalate:

Polybutylene Adipate Terephthalate (PBAT) is a biodegradable polymer that is increasingly used in the creation of compostable shopping bags due to its flexibility and versatility. PBAT-based bags offer significant advantages, including the ability to decompose in both industrial and home composting environments. This versatility helps in addressing the consumer need for convenience and sustainability. As awareness continues to grow regarding the impact of plastic waste, PBAT bags are becoming more prominent in the market, with manufacturers exploring innovative applications in various sectors.

Polyhydroxyalkanoates:

Polyhydroxyalkanoates (PHA) are biodegradable plastics produced from renewable resources, which make them an excellent choice for compostable shopping bags. PHA has the unique property of breaking down in a variety of environments, including marine and soil conditions, thus providing a comprehensive solution to plastic pollution. The ability to produce PHA through microbial fermentation of organic materials positions it as a cutting-edge alternative to traditional plastics. As consumer consciousness shifts toward sustainability, the demand for PHA-based bags is expected to rise significantly, making this material type an essential part of the compostable shopping bags market.

Paper:

Paper-based compostable shopping bags are made from sustainably sourced paper, providing an eco-friendly alternative to plastic bags. The paper used is often recyclable and biodegradable, making it a versatile solution for various retail environments. These bags are particularly favored by retailers looking to enhance their sustainability credentials while offering consumers a practical and environmentally responsible option. The ease of customization and branding on paper bags also adds to their appeal. As the push for sustainable packaging intensifies, the paper-based segment is expected to thrive, catering to the evolving consumer preferences.

By Region

North America represents a significant share of the compostable shopping bags market, driven by increasing consumer awareness and stringent regulations against plastic usage. The region's market is expected to grow at a CAGR of 11% during the forecast period, propelled by the growing presence of eco-conscious retailers and consumer demand for sustainable alternatives. The United States and Canada are at the forefront of this trend, with several states and municipalities implementing bans on single-use plastics, thus accelerating the adoption of compostable shopping bags. Furthermore, North American consumers are increasingly willing to pay a premium for products that are environmentally friendly, reinforcing the growth outlook in this region.

Europe is also witnessing robust growth in the compostable shopping bags market, supported by similar regulatory measures and a strong consumer shift toward sustainability. The European Union has enacted various directives aimed at reducing plastic waste, which is driving both consumer and manufacturer interest in compostable alternatives. Countries such as Germany, France, and the Netherlands are leading the way in adopting compostable shopping bags, with increasing initiatives from retailers to integrate these solutions into their operations. The market in Europe is positioned for significant expansion, as both consumers and businesses prioritize eco-friendly practices to combat plastic pollution.

Opportunities

The compostable shopping bags market is ripe with opportunities as the global awareness of environmental issues continues to rise. One significant opportunity lies in the advancement of biodegradable material technologies. As research and development efforts focus on improving the performance characteristics of compostable bags, manufacturers can create products that rival conventional plastic bags in durability and usability. This innovation can help bridge the gap between sustainability and practicality, attracting a wider consumer base. Additionally, the potential for partnerships between manufacturers and retailers presents another avenue for growth, as collaboration can lead to the development of bespoke solutions that cater to specific market needs and preferences.

Furthermore, as more consumers shift towards online shopping, there lies a considerable opportunity for compostable bags in the realm of e-commerce. Online retailers can utilize compostable bags not only as an environmentally friendly packaging solution but also as a marketing tool to appeal to environmentally-conscious consumers. The integration of compostable bags into subscription services and direct-to-consumer models can facilitate wider accessibility and acceptance of these sustainable products. As sustainability increasingly becomes a priority for consumers, the market for compostable shopping bags is poised for substantial growth, enabling businesses to capitalize on these emerging opportunities.

Threats

Despite the optimistic outlook for the compostable shopping bags market, there are several threats that could impact its growth trajectory. A primary concern is the potential competition from other sustainable packaging alternatives, such as reusable bags or traditional paper bags. As consumers explore varied eco-friendly options, the market for compostable bags may face challenges in terms of brand loyalty and consumer preference. Additionally, the supply chain for compostable materials can be complex and vulnerable to disruptions, which could hinder production capabilities and lead to increased costs. Fluctuations in raw material prices may also affect manufacturers' profitability, posing a risk to the overall market stability.

Another threat is the lack of consumer awareness and clarity regarding the compostability standards of various products. Misunderstandings about how compostable bags are disposed of can lead to improper disposal practices, potentially diminishing the perceived environmental benefits. Public skepticism regarding the effectiveness of compostable bags compared to traditional plastic can also impede market penetration. As such, the industry must focus on education and transparent communication to build consumer trust and mitigate these threats effectively.

Competitor Outlook

• BioBag International AS
• Novolex Holdings, LLC
• Earthpack
• Smurfit Kappa Group
• Green Bag Company
• Revolution Bag
• Inteplast Group
• Packnwood
• Bioplastics International
• Stalk Market
• Bagito
• Flexipol
• Genpak LLC
• GIRLFRIEND COLLECTIVE
• BioPack

The competitive landscape of the compostable shopping bags market is characterized by a mix of established players and emerging startups, all vying for market share amid the growing demand for sustainable packaging solutions. Companies are increasingly focusing on innovation, investing in research and development to create new and improved compostable materials. Brand positioning is also a key strategy, as many retailers are keen to highlight their commitment to sustainability, thereby influencing consumer purchasing decisions. As competition intensifies, companies are likely to engage in strategic partnerships and collaborations to enhance their product offerings and expand their market reach.

Among the key players, BioBag International AS stands out for its extensive range of compostable bags made from biodegradable materials, catering to various industries, including food service and retail. With a strong focus on environmental responsibility, the company has established a reputation for quality and reliability, making it a leader in the market. Similarly, Novolex Holdings, LLC is known for its diverse range of sustainable packaging solutions, including compostable bags, which are designed to meet the needs of retailers and consumers alike. The company's commitment to sustainability and innovation makes it a formidable competitor in the market.

Additionally, Smurfit Kappa Group and Earthpack are making significant strides in the compostable shopping bags sector, leveraging their expertise in sustainable packaging. Smurfit Kappa, with its vast resources, is focused on the development of innovative paper-based compostable solutions, while Earthpack emphasizes eco-friendly packaging for the food and retail industries. These companies are well-positioned to capitalize on the growing consumer demand for sustainable packaging, driving the compostable shopping bags market forward. As the market continues to evolve, the competitive landscape will likely undergo further changes, with emerging companies focused on sustainability and innovation gaining prominence.