Increasing Supply and Demand of Agricultural Crop Acts as a Driver for Mulch Films Market

Increasing Population and Decrease in Arable Land is Expected to Fuel the Demand of Mulch Films Market. Mulch Films Market size is forecast to reach US$5.7 billion by 2026, after growing at a CAGR of 7.8% during 2021-2026.

The Mulch Films market is growing at a significant rate during the forecast period, owning to rise in population and decrease in arable land. The global increase in population has eventually increased the demand for more crop production in order to meet with the consumers demand is a vital factor fueling its market growth. For instance, according to a recent study currently the world population consist of 7.8 billion inhabitants, having reached the 7 billion milestone in 2011, demographers expect the 8 billion milestone in 2023, with global population projected to reach 9 billion by 2037 and 10 billion by 2056. Hence, rising population will eventually led to higher demand of mulch films to modify soil temperature, limit weed growth, prevent moisture loss and improve crops yields as well as precocity which is turn is expected to boost its market growth in the upcoming years.

Apart from this the growing start-up companies adopting different measures in order to strengthen their foothold in the market is expected to fuel its market growth in the future. For instance in July 2020, the enzymatic additive Evanesto, developed by Carbiolice collaborated with Barbier Group, the French leader in the manufacture of films for agriculture. Under this collaboration, they are aiming to develop a biodegradable mulch film with a higher-content of bio-based plastics (PLA), containing the Evanesto additive, which has been designed to enable PLA to biodegradable at aimbent temperature.

In addition, increasing investments by various government bodies in agriculture is set to propel its market growth. For instance, the federal government spends more than $20billion a year on subsidies for farm business. In addition, about 39 percent of the nation’s 2.1 million farms receives subsides, with the lion’s share of the handouts going to the largest producers of corn, wheat, soybeans, cotton and rice. Hence, increasing government initiatives to improve agriculture sector in India in order to increase productivity and better crop yield is expected to drive its market growth in the future. For instance, in October 2020, Agri-lender Nabard (National Bank for Agriculture and Rural Development) proposed plans to set up a subsidiary to provide guarantee for loans under agriculture and rural development.

Asia Pacific is anticipated to emerge as a major player in the global market over the forecast period driven by the increasing agricultural investments by the government in various regions. For instance, in May 2019, NABARD announced an investment of Rs 700 crore (US$ 100 million) venture capital fund for equity investments in agriculture and rural-focused start-ups in India. In addition, the government is taking the requisite measures to increase crop productivity. China's National Development and Reform Commission announced in January 2020 that it wants to promote non-plastic products in the agriculture sector, including biodegradable mulch film. In addition, the Indian government has projected the amount of pulses that will be generated in the coming years, resulting in a major increase in demand for mulch films. Seed Division forecasts that 3,975,165 quintals of pulses will be farmed in 2020-2021, a rise of 308,947 quintals over the previous year. RWDC, a Singapore-based biotech startup, also reported that it had closed a USD 13 million Series A2 round led by venture capital firms Vickers Venture Partners and WI Harper Group. In 2019, the funds were mainly used to increase RWDC's PHA (polyhydroxyalkanoate) production capacity. During the forecast period, Asia Pacific is expected to account for 60% of the total mulch film market. This can be attributed to increased agricultural investments, especially in China and India.

However, COVID-19 has negatively impacted the Mulch Films market in 2020 with the halt in the production across various countries. The global lockdowns to curb the virus have led to the decrease in manufacturing sectors including, chemicals, agriculture and so on, which significantly resulted in the decline of market. In addition, the development of new COVID strains in countries such as India, US, UK, Nigeria and so on during end of 2020 to the beginning of 2021 is further resulting in the lockdown and impacting the manufacturing sector thereby constraining the market growth rate.

The market is expected to expand due to increasing demand in greenhouse applications and rising environmental concerns regarding synthetic counterparts. Farmers have been forced to increase productivity as a result of increasing population and diminishing agricultural land due to rapid urbanization and industrialization. Various benefits provided by these films, such as reduced environmental effects, increased crop yield by inhibiting weed growth, and conservation of soil moisture levels and temperature, are expected to drive demand over the forecast period. Government regulations that promote the use of environmentally friendly products, especially in Europe and North America, are expected to fuel market growth in the near future. The demand is motivated by the greenhouse project's growth. Globally, there are 1,228,000 acres of greenhouse growing space for production, according to the World Greenhouse Vegetable Statistics. Until completely biodegrading, biodegradable plastic mulch fragments physically change soil. PE plastic fragments, on the other hand, reduce soil penetration and water absorption, which may have an effect on greenhouse plantation soil ecosystems and, as a result, plant germination and growth. As a result, the demand for biodegradable mulch film is increasing in this area. The sector is being influenced by government policy that promotes organic mulching around the world. In Europe, for example, EN 17033 is a new product standard that defines the required specifications and test methods for biodegradable mulch films used in agriculture and horticulture. The standard is intended to provide producers, dealers, and other stakeholders with a simple reference point. Other pre-existing national standards in Europe are more likely to be replaced by EN 17033. Over the next eight years, growing concerns about plastic mulch residues in soil are expected to improve product penetration. Biodegradable films can have the advantages of plastic mulch while reducing the negative environmental effect by removing the need for removal and disposal. Using traditional plastics processing technology, biodegradable mulch films are made from these raw materials. In the biodegradable mulch film industry, adoption of starch-based mulch film is seen as a key development. Weed control, soil structure protection, and crop pollution prevention are all benefits of starch-based biodegradable mulch film. Furthermore, as opposed to other raw materials, these films are less costly and more readily available on the market. Farmers have changed their attention to the use of starch as a raw material as a result of these factors. One of the major factors driving the biodegradable mulch film market is government funding for organic mulching all over the world. According to the standards for compost degradation (ISO 17088, ASTM D6400), 90 percent of the organic carbon must be converted to CO2, thus influencing organic mulching.

The major companies in the Mulch Films market include BASF SE, The Dow Chemical Company, Berry Global Inc., Novamont S.p.A., RKW Group and others. These industry players are involved in various strategic initiatives to expand their presence. The growing number of developments by key players in order to expand its product portfolio is expected to fuel its market in the future. For instance, in February 2020, Novamont’s a Italy-based compostable bioplastic manufacturer announced that its product MATER-BI product has been certified for organic farming by the AIAB (Italian Organic Farming Association).In addition, the company product MATER-BI is developed for the production of soil-biodegradable mulching films in acquiescence with European standard UNI EN17033. Moreover, in June 2018, Jelly Bean Rubber Mulch has launched a new website JellyBeanRubberMulch.com in order to meet with the growing demand for non-toxin playground safety surface made using mulch films. Hence, such developments by the key players is expected to boost its market growth over the forecast period.