Biofuels Market - Growth, Trends, and Forecast (2020 - 2025)
The Biofuels Market is Segmented by Type (Bio-diesel, Ethanol), Feedstock (Coarse Grain, Sugar Crop, Vegetable Oil, Molasses, Jatropha, and Others), and Geography.
ABOUT THIS REPORT
Scope of the Report
Key Market Trends
TABLE OF CONTENTS
Fastest Growing Market:
Need a report that reflects how COVID-19 has impacted this market and its growth?
The Biofuels Market Is expected to grow at a CAGR of 8.26% for the forecast period of 2019-2024. The demand for secure, sustainable, and clean energy supply is expected to propel the demand for biofuels across the globe. On account of higher mandates for biofuel blending in automotive fuels and increasing government support for eco-friendly alternatives, the global consumption of biofuel is expected to further grow at a significant level during the forecast period.
According to estimates, global energy consumption is expected to increase by 28 percent by 2040 as compared to 2015. The growing environmental need is to draw upon cleaner, renewable, sustainable energy sources to meet the ever-increasing demand for fuel. Renewable energy will be the world’s fastest-growing source of energy that is expected to double from 2015 to 2030.
Biofuels (ethanol and biodiesel) represent the majority share of renewables in global energy demand for road transport. Demand for bioenergy in the transportation sector is driven by blending mandates in significant economies and by sustained fuel use around the world.
Also, the advanced liquid biofuels produced from feedstock such as lignocellulosic, waste oil, fats, municipal waste count as a viable option to decarbonize energy sectors in a cost-effective way in industries such as aviation, shipping, and freight.
For instance, according to the Tracking Transport report by IEA, the Transport biofuel production has expanded over 6% year-on-year in 2019, and 3% annual growth is projected over the course of next year five years. However, its falls short of the sustained 10% growth per year required until the year 2030 to align with Sustainable Development.
As with increasing transport fuel demand and support from government bodies for sustainable energies in ASEAN countries which evidently raises energy security ensuring demand for agricultural commodities. for instance, Over the years Chinese vendors boosted the national production of ethanol by the capacity of 258 million liters to 5,258 million liters and aim to roll out the blend of 10% ethanol in gasoline from 11 to 15 provinces
It is estimated that the share of biofuels in road transport in the OECD would increase to 20% by 2040. In the developed world similarly in aviation, the share of biofuels in jet fuel is expected to increase to 20% by 2040.
However, according to BP’s Energy Outlook, the transport sector will continue to be dominated by oil, despite increasing penetration of alternative fuels. It further adds that the share of oil within the transport industry is expected to decline to about 85% by 2040, down from the current 94%.
Natural gas, electricity, and biofuels together are expected to account for more than half of the increase in energy used in transport, with each contributing about 5% of transport demand by 2040.
However, A recent study from IRENA (International Renewable Energy Agency) on advanced biofuels that surveyed experts on the major obstacles for scaling up liquid biofuels indicate that the lack of stable regulations for the use of liquid biofuels is the biggest roadblock for the growth of the biofuel market. Also, with of decline of patent fillings , Investments have experienced the declined from USD 27 billion in 2007 to USD 2 billlion in 2017
Scope of the Report
Biofuel is the fuel that gets derived from biomass such as plant, animal waste since feedstock material is replenished readily, it is considered to be source for renewable energy unlike fossil fuels such as coal, natural gas, and petroleum, biofuels are advocated as a viable option as they are a cost-effective and environmentally benign alternative to other fuels. Biofuels are produced in the form of solid, liquid, or gas and are used to power cars, heat homes, and cooking.
The reports cover the emerging trends in biofuel market segmented by type, feedstock across different regions studied
Rest of Europe
Rest of Asia-Pacific
Rest of Latin America
Middle East and Africa
Report scope can be customized per your requirements. Click here.
Key Market Trends
Mandates Set by Various Countries to Drive the Market
The ambitious mandates set by various countries to blend biofuels with conventional fuels, to reduce the dependency on fossil fuels, has boosted the demand for biofuels across the world.
Major blending mandates that drive the global demand for biofuels are set in the US, China, and Brazil. Countries such as the US, China, and Brazil have a target of achieving 15-27% blend of biofuels with conventional fuel by 2020-2022. This reform is expected to drive global demand in the respective regions.
For instance, In December 2019, The Environmental Protection Agency (EPA) finalized the biofuel volume requirements under the Renewable Fuel Standard program for 2020 for cellulosic biofuel, biomass-based diesel, advanced biofuel, and total revenue fuel and biomass-based diesel for 2021
In line with the mandates, in Brazil, there are cars already run on petrol containing 85% ethanol, in addition to some that use 100% ethanol. In Germany, E10 fuel containing up to 10% ethanol is being sold at petrol stations since early 2011, replacing premium fuels containing 5% ethanol (E5).
In India, the National Policy on Biofuels-2018 approved by the Government envisions an indicative target of 20% blending of ethanol in petrol and 5% blending of biodiesel in diesel by 2030. This is expected to drive the adoption of biofuels in India.
The China seeks to move to 10% biofuels mandate by year 2020 despite of ethanol stocks falling to 57 million metrics tons from 200 million metric tons in 2017.
Moreover, to achieve the ambitious target, countries, such as the US, Germany, France, and Italy have implemented fuel excise tax reduction to help biofuel to compete with fossil fuels. These reforms promote the use of biofuel blend with conventional fuels. Also, low carbon energy targets and related policies are being set up to encourage the usage of biofuels.
To understand key trends, Download Sample Report
North America will hold the Largest Market Share
BP’s Energy Outlook has stated that ethanol production in 2018 totaled 60.4 Million tonnes of oil equivalent (Mtoe) with North America accounting for 56%. This landscape is expected to remain the same over the forecast period, driven by the strong mandates of the American Government.
Also, the region considers policies that specify reductions in its fuel life-cycle carbon intensity such as California's low carbon fuel standard boost the demand for biofuel and support deployment of novels advanced biofuels.
The new U.S. Renewable Fuels Standard (RFS), signed recently as part of the revised Energy Bill, has set high goals for the U.S. biofuels industry. It has set a target for production of 36 billion gallons of biofuels—mainly ethanol and biodiesel—annually by 2022, with 21 billion gallons coming “advanced biofuels,” that can be produced using multiple types feedstocks and technologies.
RFS also sets a target of roughly 16 billion gallons “cellulosic biofuels” production derived from plant sources such as trees and grasses. Cellulosic ethanol's potential remains enormous, with the Department of Energy estimates having identified 1.3 billion tons of harvestable cellulosic biomass in the United States alone, that can be used to meet more than one-third of domestic transportation fuel demand.
Additionally, for biofuels such as cellulosic ethanol and HVO, North America accounts the largest share with 94% of global production
To understand geography trends, Download Sample Report.
The competitive landscape of the Biofuels Market is fragmented. This is due to the presence of many players with a very localized focus. This is also due to different feeds that are used to produce Biofuels across the globe. Further, this industry is expected to be driven by the policy formulations of the governments. Some of the recent developments of the industry are as follows: -
January 2020- Bunge North Americas announced it has sold its stake in an ethanol plant in the US to SIRE ( Southwest lows Renewable Energy) as a challenge to resume the plague ethanol industry in America
August 2019 - State-run oil marketing companies in India that include Indian Oil, Bharat Petroleum and Hindustan Petroleum recently launched a programme to procure biodiesel made from used cooking oil in 100 cities across the country.
July 2019- VERBIO Diesel Canada, a subsidiary of VERBIO Group announced that it has completed the purchase of Atlantic Biodiesel, a biodiesel plant with an annual capacity of 150,000 approximately 150,000 tonnes of biodiesel and 18,000 tonnes of raw glycerine, This purchase will allow VERBIO to leverage their technology with the expertise of the team that has been operating the plant in the past.