The global biofuel market is projected to reach USD 225.9 billion by 2028 from an estimated USD 167.4 billion in 2023, at a CAGR of 6.2% during the forecast period. The demand for biofuels is expected to grow in developing countries due to certain key factors such as increased investments in to encourage the use of biofuels and implementation of national policies that support higher biofuel blends.
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This report segments the biofuel market based on fuel type into four categories: ethanol, biodiesel, renewable diesel, and biojets. Ethanol is expected to hold the largest market share in the biofuel market during the forecast period. Ethanol is often higher in demand owing to its long history of manufacturing and use and its versatility as a gasoline additive. Ethanol is produced from a variety of agricultural feedstocks, including corn and sugarcane. The widespread availability of these feedstocks, as well as established supply chains, contribute to the adoption of ethanol.
Based on the generation, the biofuel market is segmented into first-generation, second-generation, and third-generation. The second-generation segment is expected to be the fastest-growing market during the forecast period. Second-generation biofuels are produced from non-food biomass feedstocks, such as agricultural waste, forestry residues, and energy crops. They offer a number of advantages over first-generation biofuels, which are produced from food crops. Second-generation biofuels are more sustainable, as they do not compete with food production for land and water resources. Increasing global awareness of climate change and the need to reduce greenhouse gas emissions has driven interest in advanced biofuels.
Based on end use, the biofuel market is segmented into transportation, aviation, and others. The aviation segment is expected to be the fastest-growing market during the forecast period owing to the large-scale decarbonization activities in the aviation sector in North America and Europe. The US, Norway, the Netherlands, and the UK are contributing significantly to the long-term sustainability plans by funding the biojet fuel infrastructure. In addition, the production of bio jet fuel is expected to scale up rapidly in the coming decade due to growing research and developments in technological pathways to commercialize the use of alternative jet fuels.
Top Companies in Biofuel Industry
- ADM (US),
- Chevron (US),
- Valero (US),
- Neste (Finland),
- Cargill, Incorporated (US) among others…
ADM
ADM, also referred to as Archer Daniels Midland Company, primarily engages in the processing of agricultural commodities and other ingredients used in various food, beverage, and industrial products. It operates through its four business segments: Ag Services and Oilseeds, Carbohydrates Solutions, Nutrition, and Other. The Ag Services and Oilseeds business segment offers feedstocks such as vegetable oils and other raw materials that are refined and utilized to produce biodiesel. The Carbohydrates Solutions business segment converts corn and wheat into products and ingredients, such as sweeteners, corn, wheat starches, syrup, glucose, wheat flour, and dextrose. These dextrose and starch are used as feedstocks for the company’s bioethanol and other biofuels. The company has four bioproduct processing plants in Nebraska, Iowa, Illinois, and Minnesota, all in the US. However, a major share of the revenue is generated outside the US.
Valero
Valero is a leading producer of transportation fuels and petrochemical products, such as low-carbon fuels, jet fuel, ethanol, gasoline, and renewable diesel. The company operates its business through three segments, namely Refining, Renewable Diesel, and Ethanol. Valero provides biofuel under its Renewable Diesel and Ethanol business segments. Under these segments, Valero also offers low-carbon renewable fuel services and products for transportation & logistics. Some of the other products offered by the company under the Renewable Diesel and Ethanol are distillers grains – dried or modified (wet), fuel-and feed-grade corn oil, and ethanol. Valero has a strong global presence with its corporate research centers in six countries, namely, the US, the UK, Canada, Ireland, Peru, and Mexico. The company has 12 ethanol plants in the Mid-Continent region in the US, with a combined production capacity of approximately 1.6 billion gallons per year.
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Europe is expected to be the fastest-growing region in the biofuel market.
Europe is expected to be the fastest growing region in the biofuel market during the forecast period. The European region comprises major economies such as France, UK, Germany, and Poland. The biofuel market in Europe is primarily fueled by the three main types of biofuels, namely ethanol, biodiesel, and renewable diesel. Europe has actively fostered the use of biofuel through various policies and initiatives. The European Union (EU) has established targets for member states to enhance the utilization of renewable energy in transportation, including biofuels like biofuel. The Renewable Energy Directive (RED) and its subsequent revisions have played a pivotal role in shaping biofuel production and consumption in Europe.
