Report ID: SQMIG10F2028
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Report ID:
SQMIG10F2028 |
Region:
Global |
Published Date: June, 2025
Pages:
198
|Tables:
209
|Figures:
78
Global Biofuels Market size was valued at USD 117.69 Billion in 2024 and is poised to grow from USD 125.58 Billion in 2025 to USD 210.97 Billion by 2033, growing at a CAGR of 6.7% during the forecast period (2026–2033).
The biofuels industry is experiencing significant growth, largely because of growing environmental concerns and the worldwide trend toward renewable fuels. Among the main driving forces is government policy support, such as subsidies, mandates, and tax credits for blending biofuels with conventional fuels. Strong biofuel mandates have been adopted by nations such as the U.S., Brazil, and European Union members, like the U.S. Renewable Fuel Standard (RFS) and the EU's Renewable Energy Directive (RED), which have immensely spurred market uptake.
Further, increasing consciousness regarding carbon emissions reduction and energy security needs have spurred investments in production technologies of biofuels like second-generation and advanced biofuels.From the demand-side and technological viewpoint, innovations in feedstock processing, enzyme technology, and biorefineries are making the economy of biofuel production more viable. Growing demand for aviation fuel (SAF) and renewable diesel, particularly for the transport and aviation industries, is creating new revenue streams.
In addition, increasing crude prices and uncertainty in the global oil supply chain are forcing governments and industries to diversify their energy base, further boosting the growth of the market for biofuels. Growing investments by emerging economies in biomass-based energy infrastructure also are fueling the growth of the market.On the constraint side, the market is threatened by high production costs, competition for land use, and availability of feedstock. The food or fuel issue—when arable land is taken out of food crops and used for biofuel crops—is a significant economic and ethical issue. Furthermore, poor infrastructure availability for distribution and blending in certain countries, particularly in developing nations, constrains biofuel penetration. Feedstock price fluctuations like sugarcane and corn and the intricate regulatory landscape around the world also hamper smooth market expansion. These limitations have to be overcome with innovation, investment, and regulation harmonization to realize the full potential of the biofuels market.
How AI is Transforming Biofuels Market?
Artificial Intelligence (AI) and the Internet of Things (IoT) are transforming the biofuels sector by maximizing feedstock-to-fuel efficiency.Predictive analytics using AI streamline fermentation and conversion processes, while IoT-based sensors track parameters such as temperature, pH, and moisture in real-time. The synergy decreases downtime, boosts yields, and reduces operational expenses through proactive maintenance and process management. A pilot bio-refinery in Europe initiated a digital-twin platform driven by AI and IoT to model biomass processing in real-time. Initial findings indicated a 12% boost in bioethanol output and a 15% energy saving during trials. This attests to the revolutionary potential of the integration of AI models with sensor networks to optimize production—phasing out the traditional towards sustainable, data-driven biofuel operations.
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The global biofuels market is segmented by Fuel Type, Feedstock, Form, Generation, Application, End User, Distribution Channel and region. Based on Fuel Type, the market is segmented into Bioethanol, Biodiesel, Biogas and Others. Based on Feedstock, the market is segmented into Sugar-Based, Starch-Based, Oil-Based, Cellulosic Materials, Animal Fats & Waste Oils and Municipal Solid Waste (MSW) & Industrial Waste. Based on Form, the market is segmented into Solid, Liquid and Gaseous. Based on Generation, the market is segmented into First Generation, Second Generation and Third Generation.
Based on Application, the market is segmented into Transportation, Power Generation, Heating, Industrial Use and Others. Based on End User, the market is segmented into Automotive Industry, Aerospace Industry, Marine Industry, Power Utilities and Others. Based on Distribution Channel, the market is segmented into Direct Sales, Third-party Distributors, Retail Fuel Stations and Online Sales Platforms. Based on region, the market is segmented into North America, Europe, Asia Pacific, Latin America and Middle East & Africa.
Starch-based feedstocks reign supreme: corn ethanol, a starch-based biofuel, represented some 15 billion gallons of U.S. output in 2023, supported by federal Renewable Fuel Standard requirements and DOE-sponsored efficiency grants. This government support stimulates economies of scale and underpins world starch-based biofuel leadership.
Animal fats & waste oils are the most rapidly expanding biofuels feedstock, increasing from 19.2 billion to more than 32.0 billion lb in the U.S. between 2021 and 2023 37% of feedstock share stimulated by Renewable Fuel Standard incentives and USDA data. Worldwide, the EU's revised RED II now requires a 1.7% cap on UCO/animal-fat biofuels, underlining this development
The dominance of this segment can be attributed to the fact that bioethanol is utilized in conventional petrol engines with slight alterations. Large investments in clean fuel R&D have resulted in the production of sophisticated bioethanol fuels that can propel vehicles with negligible emissions. Furthermore, bioethanol is being derived from natural waste, which is fully biodegradable. This also renders bioethanol an extremely sought-after fuel option with one of the lowest carbon profiles. Biodiesel is the most rapidly expanding segment of the biofuels market. Nevertheless, an increasing emphasis on reducing emissions from heavy-duty trucking is poised to drive biodiesel and additive demand higher in the future rapidly. Growing emphasis on mitigating the carbon footprint of the aircraft industry is creating new opportunities for biodiesel suppliers. Strong emphasis on sustainability is poised to provide money-making opportunities for suppliers of biodiesel additives in the long term.
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North America, dominated overwhelmingly by the U.S., generates more than 33% of revenue from biofuels worldwide in 2023 and represents the biggest share by region. The market in 2024 grew to USD 52.3 billion until 2034, supported by robust federal mandates EPA Renewable Fuel Standard and tax credits SAF incentives under the Inflation Reduction Act.
At the helm of the U.S. biofuels market through its Low Carbon Solutions business, ExxonMobil invests in algae biofuels and the production of renewable diesel. Backed by the acquisition of Biojet AS and plans for hydrogen and carbon capture, it supports U.S. DOE's clean fuels agenda and federal tax credits.
Braya's renewable diesel refinery served U.S. markets until shut down by uncertain U.S. tax-credit policy. Reopening depend on Canadian-U.S. cooperation regarding federal incentives, illustrating intergovernmental control over North American biofuel operations.
Asia Pacific is the region with the fastest growth, growing between 2024 and 2030, with revenues increasing from USD 19.8 billion in 2023 to USD 43.9 billion by 2030. Favorable government policies like Thailand's B5 biodiesel mandate and growing liquid biofuels segment are responsible for the increase.
China dominates APAC biodiesel demand, with more than twenty refineries catering to its giant auto industry—propelling regional leadership because of favorable national policies and magnitude of operations.
India's National Policy on Biofuels (2018, revised 2022) has pushed ethanol blending to 20% and hastened E 20 targets to 2025, driving investments by industry leaders such as Indian Oil and Reliance.
South Korea is a pioneer in aviation biofuels, imposing 1% sustainable aviation fuel (SAF) on all its international flights from 2027, supported by tax credits and refiners' co-processing incentives like SK Innovation and GS Caltex. Also, its Renewable Fuel Standard requires a diesel-biodiesel blend increasing to 5% by 2030, to be extended to 8% with advanced biofuels.
Europe is an important player in the global biofuels market due to robust environmental policies and ambitious decarbonization plans. The continent is determined to cut greenhouse gas (GHG) emissions through regulatory schemes such as the Renewable Energy Directive III (RED III), which requires a 14.5% contribution of advanced biofuels in transport by 2030.
Germany dominates Europe's biodiesel industry. Its government excluded oil companies from averaging earlier years' emissions credits to achieve Greenhouse Gas (GHG) targets, assuring compliance and stimulating domestic investment in biofuels. This change aligns with Germany's aim for a 25% carbon cut by 2030 and enhances demand for advanced biofuels.
France is advancing sustainable aviation fuels (SAF), launching the €1 billion BioTJet plant in Lacq (June 2023) to produce jet fuel and bionaphtha from biomass. This flagship facility aligns with ReFuelEU ambitions and reinforces France's leadership in SAF development.
The UK Renewable Transport Fuel Obligation (RTFO) demands the consumption of E10 gasoline, providing an 82% lifecycle greenhouse gas (GHG) savings over fossil fuel. UK bioethanol production rises under demand, promoting the utilisation of sustainable feedstocks and boosting the UK's renewable fuel policy.
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Government Policies and Incentives
Environmental Sustainability
Popularity of Electric Vehicles
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Biofuel suppliers can take advantage of the imposition of stringent vehicle emission mandates being implemented across the world to boost sales. Biofuel companies are also continually investing in research and development to enhance the performance and costs of biofuels to boost their large-scale adoption. Market players can also leverage strategies such as collaborations, mergers, acquisitions, and partnerships to fast-track the development of novel biofuel and boost the overall biofuels industry growth. Biofuel manufacturers are also focusing on expanding their biofuel production capacity to meet the surging demand across the world.
Is SAF production scaling up rapidly?
Are blending mandates tightening under RED III?
SkyQuest’s ABIRAW (Advanced Business Intelligence, Research & Analysis Wing) is our Business Information Services team that Collects, Collates, Correlates, and Analyses the Data collected using Primary Exploratory Research backed by robust Secondary Desk research.
According to global market analysis, the Biofuels market continues to be driven by the efficacy of checkpoint inhibitors in a variety of cancer types and increasing government investment in immunotherapy research and development, while the rising use of personalized medicine as a treatment option is driving research and development in the field. High treatment costs and immune-related adverse events are consistent challenges that are likely to limit acceptance across the board. Both North America and Asia-Pacific are the two leading regions of opportunity, although for distinctly different reasons. North America is a leader in this area of Economic opportunity because of its world-class infrastructure, investment capabilities, and regulations. Looking to Asia-Pacific, the region is growing rapidly due to the higher-than-average cancer incidence rate and improving access to health care coverage that is further supplemented by government approvals of various innovative therapies. The unique collaborations, government-backed research opportunities, and global regulatory convergence could lead the market to unprecedented levels of growth and competition.
| Report Metric | Details |
|---|---|
| Market size value in 2024 | USD 117.69 Billion |
| Market size value in 2033 | USD 210.97 Billion |
| Growth Rate | 6.7% |
| Base year | 2024 |
| Forecast period | 2026-2033 |
| Forecast Unit (Value) | USD Billion |
| Segments covered |
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| Regions covered | North America (US, Canada), Europe (Germany, France, United Kingdom, Italy, Spain, Rest of Europe), Asia Pacific (China, India, Japan, Rest of Asia-Pacific), Latin America (Brazil, Rest of Latin America), Middle East & Africa (South Africa, GCC Countries, Rest of MEA) |
| Companies covered |
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| Customization scope | Free report customization with purchase. Customization includes:-
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Table Of Content
Executive Summary
Market overview
Parent Market Analysis
Market overview
Market size
KEY MARKET INSIGHTS
COVID IMPACT
MARKET DYNAMICS & OUTLOOK
Market Size by Region
KEY COMPANY PROFILES
Methodology
For the Biofuels Market, our research methodology involved a mixture of primary and secondary data sources. Key steps involved in the research process are listed below:
1. Information Procurement: This stage involved the procurement of Market data or related information via primary and secondary sources. The various secondary sources used included various company websites, annual reports, trade databases, and paid databases such as Hoover's, Bloomberg Business, Factiva, and Avention. Our team did 45 primary interactions Globally which included several stakeholders such as manufacturers, customers, key opinion leaders, etc. Overall, information procurement was one of the most extensive stages in our research process.
2. Information Analysis: This step involved triangulation of data through bottom-up and top-down approaches to estimate and validate the total size and future estimate of the Biofuels Market.
3. Report Formulation: The final step entailed the placement of data points in appropriate Market spaces in an attempt to deduce viable conclusions.
4. Validation & Publishing: Validation is the most important step in the process. Validation & re-validation via an intricately designed process helped us finalize data points to be used for final calculations. The final Market estimates and forecasts were then aligned and sent to our panel of industry experts for validation of data. Once the validation was done the report was sent to our Quality Assurance team to ensure adherence to style guides, consistency & design.
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With the given market data, our dedicated team of analysts can offer you the following customization options are available for the Biofuels Market:
Product Analysis: Product matrix, which offers a detailed comparison of the product portfolio of companies.
Regional Analysis: Further analysis of the Biofuels Market for additional countries.
Competitive Analysis: Detailed analysis and profiling of additional Market players & comparative analysis of competitive products.
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North America, led by the U.S., accounted for over 33% of global biofuel revenue in 2023. The market reached USD 52.3 billion in 2024, driven by federal policies like the EPA Renewable Fuel Standard and SAF tax incentives under the Inflation Reduction Act.
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