The global biofuels production market was valued at nearly 120 billion U.S. dollars in 2023. Figures are projected to continuously increase until 2030 when the biofuels market is forecast to amount to more than 175 billion U.S. dollars. More information on the global biofuels production market can be found here. Largest biofuel producers Biofuels are especially prevalent in the transportation sector and have been marketed as a renewable alternative to petroleum-based motor fuels such as gasoline and diesel. Ethanol and biodiesel are the most common biofuel types, which are won from distilling and refining feedstocks such as crops, vegetable oils, and cooking fats. Although biofuel adoption has increased, they are usually blended with gasoline and diesel in order for them to work in regular combustion engines. The United States is the leading biofuel producing country in the world, followed by Brazil and Indonesia. Biofuels production to exceed 200bn liters Both ethanol and biodiesel production is forecast to increase in the coming years. In 2024, a biofuel production forecast suggests worldwide output could edge close to 200 billion liters per annum.

The Report Covers Biofuels Market Size & Share and It is Segmented by Type (Biodiesel, Ethanol, and Other Types), Feedstock (Palm Oil, Jatropha, Sugar Crop, Coarse Grain, and Other Feedstock), and Geography (North America, Europe, Asia-Pacific, South America, the Middle East, and Africa). The Report Offers Market Size and Forecasts for the Biofuels Market in Volume for all the Above Segments.

According to Cognitive Market Research, the global advanced biofuel market size will be USD 20514.5 million in 2024. It will expand at a compound annual growth rate (CAGR) of 8.80% from 2024 to 2031.

North America held the major market share for more than 40% of the global revenue with a market size of USD 8205.80 million in 2024 and will grow at a compound annual growth rate (CAGR) of 7.0% from 2024 to 2031.
Europe accounted for a market share of over 30% of the global revenue with a market size of USD 6154.35 million.
Asia Pacific held a market share of around 23% of the global revenue with a market size of USD 4718.34 million in 2024 and will grow at a compound annual growth rate (CAGR) of 10.8% from 2024 to 2031.
Latin America had a market share of more than 5% of the global revenue with a market size of USD 1025.73 million in 2024 and will grow at a compound annual growth rate (CAGR) of 8.2% from 2024 to 2031.
Middle East and Africa had a market share of around 2% of the global revenue and was estimated at a market size of USD 410.29 million in 2024 and will grow at a compound annual growth rate (CAGR) of 8.5% from 2024 to 2031.
The thermochemical category is the fastest growing segment of the advanced biofuel industry

Market Dynamics of Advanced Biofuel Market

Key Drivers for Advanced Biofuel Market

Technological Advancements in Biofuel Production Processes to Boost Market Growth

Technological developments in biofuel production techniques are driving growth in the advanced biofuel industry by increasing efficiency and diversifying feedstock sources. Non-food biomass, such as agricultural leftovers, is being converted into biofuels more efficiently because of advances in enzyme engineering and synthetic biology. Advanced fermentation processes are also improving bioethanol and biodiesel production. Thermochemical methods such as gasification and pyrolysis have enabled the conversion of waste materials into biofuels such as syngas and biodiesel. These innovations lower production costs and increase scalability, making biofuels more competitive with fossil fuels. Neste and Chevron are setting the standard by aggressively investing in new technologies and growing their production capacity. In addition, the market is anticipated to grow during the projected period as a result of players in the industry adopting Advanced Biofuels. For instance, according to the International Energy Agency (IEA), biofuel production is expected to increase by 28% between 2021 and 2026, driven by innovations in enzymatic hydrolysis and fermentation processes.

Rising Government Mandates and Policies Encouraging Renewable Energy Adoption to Drive Market Growth

Rising government regulations and policies are important drivers of the advanced biofuel business, boosting renewable energy use to minimize carbon emissions. Governments around the world, particularly in the United States, the European Union, and Brazil, have introduced policies like as blending mandates and subsidies to encourage biofuel use in the transportation and industrial sectors. For example, the United States Renewable Fuel Standard (RFS) and the European Union's Renewable Energy Directive (RED II) set lofty goals for boosting biofuel blends in fuel supplies. These policies provide financial incentives and tax benefits to biofuel producers, encouraging research and investment in advanced biofuels and ultimately hastening the transition to cleaner energy sources.

Restraint Factor for the Advanced Biofuel Market

High Production Costs Compared to Conventional Fossil Fuels Will Limit Market Growth

The advanced biofuel sector is hampered by high production costs when compared to conventional fossil fuels. Producing biofuels, particularly second-generation variations, necessitates sophisticated procedures and expensive technology such as enzymatic hydrolysis and gasification, which raises operational expenses. Furthermore, finding renewable feedstocks such as agricultural leftovers or algae can be more expensive and unpredictable than extracting fossil fuels. The necessity for specialized infrastructure for biofuel production, storage, and transport raises the cost even further. As a result, despite their environmental benefits, biofuels frequently struggle to compete with cheaper fossil fuels, restricting their broad use in cost-sensitive industries such as transportation and electricity.

Impact of Covid-19 on the Adv...

The global biofuels market is likely to expand from USD 173.09 billion in 2024 to USD 369.19 billion by 2037, registering a CAGR of around 6% during the forecast timeline, from 2025 through 2037. Key industry players include Butamax Advanced Biofuels LLC, Green Plains Inc., Petrobras, Renewable Energy Group, among others.

The report covers Biofuel Companies in Brazil and it is segmented by Type (Biodiesel, Ethanol, and Other Types) and Feedstock (Coarse Grain, Sugar Crop, Vegetable Oil, and Other Feedstocks). The report offers the production forecasts in million cubic meters (MCM) for all the above segments.

The biofuels production market in Europe was valued at roughly 18 billion U.S. dollars in 2023. In 2024, this figure is forecast to increase to 18.5 billion U.S. dollars. More information on the biofuels production market can be found here.

According to Cognitive Market Research, the global biofuel market size is USD 167.4 billion in 2024 and will expand at a compound annual growth rate (CAGR) of 6.2% from 2024 to 2031. Market Dynamics of Biofuel Market

Key Drivers for Biofuel Market

Increasing the use of biofuels in vehicles- Utilizing biofuels in automobiles would significantly help to reduce CO2 emissions, which is driving the market's rapid growth. Emissions from fossil fuels can be avoided, and the resultant CO2 can be preserved underground by moving to an alternate energy source. Further reductions take place since the trees and plants that contribute to the feedstocks for biofuels need CO2 to expand. The need to use environmentally friendly gasoline will, therefore, benefit the liquid biofuels industry going forward.
Another element anticipated to promote the focus on market's expansion is the availability of more modern a substrate for the manufacturing of biofuels.

Key Restraints for Biofuel Market

One difficulty facing the biofuel industry is the high and unpredictable price of feedstock.
The market penetration of biofuels also faces a number of challenges related to manufacturing and exploitation, such as low consumer knowledge of the usage of greener energy alternatives in some regions.

Introduction of the Biofuel Market

Biofuels are renewable fuels made from biomass such as plant matter, animal matter, or human waste. Several nations are making efforts to reduce their reliance on foreign oil. With oil refineries operating at full capacity and prices on the rise, businesses and consumers alike are looking for alternatives. The biofuel market is being driven by the increased use of green energy sources and the introduction of laws to cut carbon dioxide emissions. Global electricity consumption has increased as a result of fast urbanization and industrialization. As a result, a number of governments are making investments in renewable sources of energy to meet the growing need for electricity while also advancing their environmental objectives. An increase in the number of new biofuel projects being built is anticipated to grow the market.

Analyze the market segmentation of the Biofuels industry. Gain insights into market share distribution with a detailed breakdown of key segments and their growth.

The Market is Segmented by Raw Material (Jatropha, Lignocellulose, Algae, and Other Raw Materials), Biofuel Type (Cellulosic Biofuel, Biodiesel, Biogas, Biobutanol, and Others), Technology (Biochemical and Thermochemical), and Geography (North America, Europe, Asia-Pacific, South America, and Middle East and Africa). The report offers the market size and forecasts in production capacity (in thousand barrels of oil equivalent per day) for all the above segments.

In 2024, after two years of decline, there was significant growth in the Canadian solid biofuel market, when its value increased by 590% to $548M. Overall, consumption, however, showed a deep downturn. Solid biofuel consumption peaked at $2.5B in 2014; however, from 2015 to 2024, consumption remained at a lower figure.

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Biofuels Market Size 2024-2028

The biofuels market size is forecast to increase by USD 26.6 bn at a CAGR of 3.23% between 2023 and 2028.

The market is experiencing significant growth due to the increasing adoption of renewable energy sources as a response to reducing greenhouse gas emissions. Key biofuels include those derived from corn, sugarcane, vegetable oil, and biomass. In the automotive sector, biofuels are gaining popularity as an alternative to traditional fossil fuels, while In the maritime industry, they are being used to power ships. The research and development of third-generation biofuels, such as algae fuel, is also a growing trend In the market. Additionally, fluctuations in oil prices continue to drive demand for biofuels as a cost-effective alternative. Overall, the market is poised for continued growth as the world transitions to more sustainable energy sources.

What will be the Size of the Biofuels Market During the Forecast Period?

Request Free SampleThe market encompasses the production and utilization of renewable transport fuels derived from various feedstocks, including vegetable oils, ethanol, hydrogenated oil, and biomass. Biofuels have gained significant traction as a sustainable alternative to fossil fuels, such as gasoline and diesel, due to their potential to reduce greenhouse gas emissions, enhance energy security, and decrease oil imports. Policy design, including blending mandates, plays a crucial role in market growth. Biofuels derived from feedstocks like coarse grain, sugar crops, jatropha, molasses, and biomass are commonly used. Renewable diesel, ethanol, and biodiesel are the major liquid biofuels, while hydrogenated oil and biomass are used for producing advanced biofuels like hydrogenated vegetable oil and biomass-based diesel.Algae-based biofuels, including cyanobacterial development, are emerging as promising alternatives. Environmental regulations and the policy on biofuels continue to shape the market's direction, with a focus on reducing greenhouse gas emissions and promoting cleaner fuels.

How is this Biofuels Industry segmented and which is the largest segment?

The biofuels industry research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in 'USD billion' for the period 2024-2028, as well as historical data from 2018-2022 for the following segments. ApplicationTransportationAviationHeatingEnergy generationOthersProductEthanolBiodieselGeographyNorth AmericaUSEuropeUKAPACChinaIndiaSouth AmericaBrazilMiddle East and Africa

By Application Insights

The transportation segment is estimated to witness significant growth during the forecast period. The market In the transportation sector encompasses the production, distribution, and consumption of biofuels as a substitute for traditional fossil fuels, predominantly In the transportation industry. Biofuels are derived from renewable sources, including plants, algae, and organic waste, and are utilized to fuel various vehicles, such as cars, trucks, ships, and airplanes. The market's expansion is driven by environmental regulations, the need for GHG reductions, and energy security concerns. Key biofuels include ethanol, biodiesel, renewable diesel, hydrogenated oil, biojet, and sustainable aviation fuel. Feedstocks for biofuel production include vegetable oil, molasses, coarse grain, sugar crops, and biomass, among others.Policy design, such as blending mandates, the Renewable Fuel Standard, and the RenovaBio scheme, have significantly influenced market growth. Biofuels offer energy efficiency advantages and contribute to reducing greenhouse gas emissions, making them a sustainable alternative to petroleum oil. The transportation sector's transition to cleaner fuels is a critical step towards reducing oil imports and mitigating the environmental impact of fossil fuels.

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The Transportation segment was valued at USD 100.40 bn in 2018 and showed a gradual increase during the forecast period.

Regional Analysis

APAC is estimated to contribute 28% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.

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The North American the market, encompassing the US, Mexico, and Canada, is primarily driven by the automotive, mining, agriculture, power generation, marine, and railway sectors. The region's growth rate is forecasted to be moderate due to trade-related factors, such as tariffs and import-export regulations, influencing biofuel imports from Argentina, Indonesia, and Malaysia. The Canadian government is advocating for biofuels to decrease carbon emissions from automotive

North America's biofuels production market is forecast to be worth 46.38 billion U.S. dollars in 2024. By 2026, the market is expected to exceed 50 billion U.S. dollars. More information on the biofuels production market can be found here.

The market is segmented by Raw Material (Jatropha, Lignocellulose, Algae, and Other Raw Materials), Biofuel Type (Cellulosic Ethanol, Biodiesel, Biogas, Biobutanol, and Other Biofuel Types), Technology (Biochemical, and Thermochemical), and Geography (Germany, France, Spain, United Kingdom, and Rest of Europe). The report offers the market size and forecasts in revenue (USD Billion) for all the above segments.

Biofuel Generator Sets Market size was valued at USD 636.23 Million in 2023 and is projected to reach USD 1,400.22 Million by 2030, growing at a CAGR of 10.8% during the forecast period 2024-2030.

Global Biofuel Generator Sets Market Drivers

The market drivers for the Biofuel Generator Sets Market can be influenced by various factors. These may include:

Growing Need for Renewable Energy: The demand for biofuel generator sets is being driven by the growing attention being paid globally to sustainable and renewable energy sources. With their organic origins, biofuels offer a sustainable substitute for conventional fossil fuels.
Environmental Worries and Emission Reduction: Businesses and consumers are being pushed to embrace greener energy solutions by growing worries about environmental pollution and climate change. Generator sets powered by biofuels have reduced carbon emissions and support initiatives to cut greenhouse gas emissions.
Government Initiatives and Incentives: The market for biofuel generator sets has grown dramatically as a result of favorable government policies, laws, and incentives encouraging the use of renewable energy sources. Businesses and private citizens are encouraged to engage in biofuel-based power generation through incentives including tax credits and subsidies.
Energy Security: To ensure energy security, diversifying one’s energy sources is essential. By offering a dependable and renewable alternative to traditional fossil fuels for power generation, biofuel generator sets promote energy variety.

The global biodiesel market size reached USD 46.1 Billion in 2024. Looking forward, IMARC Group expects the market to reach USD 63.4 Billion by 2033, exhibiting a growth rate (CAGR) of 3.6% during 2025-2033. Government regulations promoting renewable energy, surging concerns over energy security and oil price volatility, continuous technological advancements in production processes, increasing public awareness of environmental issues, and escalating efforts to combat climate change are some of the factors propelling the market.

Report Attribute	Key Statistics
Base Year	2024
Forecast Years	2025-2033
Historical Years	2019-2024
Market Size in 2024	USD 46.1 Billion
Market Forecast in 2033	USD 63.4 Billion
Market Growth Rate (2025-2033)	3.6%

IMARC Group provides an analysis of the key trends in each segment of the global biodiesel market report, along with forecasts at the global and regional levels from 2025-2033. Our report has categorized the market based on feedstock, application, type and production technology.

In 2024, the UK solid biofuel market increased by 28% to $2B for the first time since 2021, thus ending a two-year declining trend. Overall, consumption continues to indicate a prominent increase. Solid biofuel consumption peaked at $2.1B in 2021; however, from 2022 to 2024, consumption stood at a somewhat lower figure.

The Jordanian solid biofuel market was estimated at $65M in 2024, growing by 5.2% against the previous year. Overall, consumption enjoyed a buoyant expansion. Over the period under review, the market hit record highs in 2024 and is likely to continue growth in the near future.

The European biofuel market is segmented by type (Biodiesel, Ethanol, and Other Types), feedstock (coarse grain, sugar cane, vegetable oil, and other feedstock), and geography (Germany, the United Kingdom, France, and the Rest of Europe). The report offers the market size and forecasts for biofuel in volume (million liters) for all the above segments.

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Biodiesel Market Size 2024-2028

The biodiesel market size is forecast to increase by USD 16.71 billion at a CAGR of 7.38% between 2023 and 2028.

The market is experiencing significant growth due to the increasing demand for renewable and sustainable energy sources. One of the key drivers is the growing use of algae for biodiesel production, which offers numerous advantages such as high oil yield and reduced greenhouse gas emissions. Soy oil and palm oil are the most commonly used feedstocks due to their availability and cost-effectiveness. Another trend in the market is the utilization of spent bleaching earth as a feedstock for biodiesel production, which not only reduces waste but also lowers production costs. However, the high operating costs of biodiesel production remain a major challenge for market growth. Producers must continuously explore ways to improve efficiency and reduce costs to remain competitive in the market. Overall, the market is expected to witness steady growth in the coming years, driven by increasing environmental awareness and government regulations promoting the use of renewable energy sources.

What will be the Size of the Biodiesel Market During the Forecast Period?

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The market represents a significant segment of the renewable biofuels industry, driven by the growing demand for environmentally friendly fuels In the transportation sector. With the increasing global population and the subsequent rise in vehicles on the road, there is a pressing need to reduce carbon emissions and dependence on fossil fuels. Biodiesel, derived from vegetable oils such as soybean oil, corn oil, canola oil, and animal tallow, among others, is a viable alternative to petroleum-based diesel fuels. The market is influenced by various factors, including feedstock selection, production capacity, and crude prices.
The market's size and direction are influenced by the adoption rate of biodiesel by Original Equipment Manufacturers (OEMs) and the availability of raw materials. The use of biodiesel in diesel engines reduces greenhouse gas emissions, making it an attractive option for consumers and governments alike. Global biodiesel consumption is expected to grow as more countries shift towards sustainable biofuels to mitigate their carbon footprint.

How is the Biodiesel Industry segmented and which is the largest segment?

The industry research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in 'USD billion' for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.

Application

  Transport fuel
  Power generation
  Others


Type

  Vegetable oil
  Animal fats
  Others


Geography

  APAC

    India
    Thailand


  North America

    US


  Europe



  South America

    Brazil


  Middle East and Africa

By Application Insights

The transport fuel segment is estimated to grow significantly during the forecast period. Biodiesel serves as an eco-friendly alternative to traditional diesel fuel for internal combustion engines. In Europe, biodiesel dominates the biofuel market, accounting for over 80% of consumption, driven by its increasing adoption in the automotive sector. In India, the biodiesel industry is poised for growth due to substantial investments in manufacturing, with several states, such as Karnataka, utilizing biodiesel in public transportation to reduce greenhouse gas emissions. Vegetable oils, including soybean oil, corn oil, canola oil, animal fats like poultry fat and tallow, and feedstocks like palm oil and palm kernel oil, serve as raw materials for biodiesel production. The shift towards sustainable biofuels is driven by environmental concerns and increasing crude oil prices. Biodiesel is also used in power generation applications, further expanding its market reach.

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The Transport fuel segment was valued at USD 25.90 billion in 2018 and showed a gradual increase during the forecast period.

Regional Analysis

APAC is estimated to contribute 49% to the growth of the global market during the forecast period. Technavio's analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.

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Biodiesel production in Indonesia and India is experiencing growth due to government subsidies and mandates. In Indonesia, production has increased since 2016, driven by new subsidy calculations and domestic blending requirements. Exports remain marginal. In India, the expansion of biofuel plants and government incentives for oil manufacturing companies will boost biodiesel production during the forecast period. Vegetable oils, such as soybean oil, corn oil, and canola oil animal fats, incl

The advanced biofuels market will see outlandish growth during the period 2025 to 2035 with government policies being the driving force towards technological advancements. The market of 2024 was far in excess of USD 19.4 billion and, being calculated in value terms, can grow with the said 8.6% compound annual rate to cover the period under forecast.

Metric	Value
Market Size in 2025	USD 20.1 Billion
Projected Market Size in 2035	USD 45.8 Billion
CAGR (2025 to 2035)	8.6%

Country-wise outlook

Country	CAGR (2025 to 2035)
USA	8.0%

Country	CAGR (2025 to 2035)
Germany	8.6%

Country	CAGR (2025 to 2035)
Brazil	8.6%

Country	CAGR (2025 to 2035)
China	8.2%

Country	CAGR (2025 to 2035)
India	8.4%

Country	CAGR (2025 to 2035)
Canada	8.3%

Country	CAGR (2025 to 2035)
Japan	8.3%

Country	CAGR (2025 to 2035)
South Korea	8.5%