May 22, 2024

The Global Bioethanol Market is estimated to fuel by Sustainable Transportation Fuel Production

Bioethanol is a biofuel produced by fermentation, mostly from carbohydrate crops like maize, sugarcane or sugar beet. It is commonly used as a bio-component to gasoline to reduce dependence on petroleum and cut emissions. Bioethanol’s cleaner-burning and renewable properties make it an attractive alternative fuel option. Being an agricultural commodity, bioethanol production also supports farmers and rural economies. Favorable government policies, especially in Europe and the US promoting the blending of biofuels with gasoline are driving the growth of the bioethanol market.

The Global Bioethanol Market is estimated to be valued at US$ 13.7 Billion in 2024 and is expected to exhibit a CAGR of 9.8% over the forecast period from 2024 to 2031.

Key Takeaways

Key players operating in the bioethanol market are CropEnergies, British Sugar, New Generation Biofuels Holdings, Inc., Vivergo Fuels Limited, Butalco GmbH, and Global Green SA. Cropenergies is the European market leader in bioethanol production with an annual capacity of over 1.3 billion liters across its five production facilities.

The growing demand for low-carbon renewable fuels from the transportation sector presents strong growth opportunities for bioethanol producers. Developing tropical regions offer high potential for sugarcane-based bioethanol production and exports. Favorable policies promoting crop-based biofuel blending targets as well as tax incentives are boosting investments in new refining capacities across Latin America and Asia Pacific.

Stringent emission norms and sustainability mandates in the European Union and the US have increased the usage of advanced biofuels derived from agricultural and forestry residues. Leading bioethanol producers are increasingly diversifying into cellulosic technologies unlocking new feedstock sources and applications in the aviation and marine industries. Partnerships with oil refiners are helping expand global market access and distribution networks.

Market Drivers

The favorable policies of various governments aiming to reduce dependence on fossil fuels and decrease carbon emissions from the transportation sector are a key driver for the bioethanol market growth. Many countries have mandated the blending of bioethanol with gasoline. For instance, the US has set the Renewable Fuel Standard to use at least 15 billion gallons of corn-based ethanol in gasoline annually by 2022. Such supportive regulations are encouraging investments in bioethanol production capacities.

PEST Analysis

  • Political: Supports from governments in form of tax credits and subsidies are promoting the production and use of bioethanol which is reducing dependency on fossil fuels.
  • Economic: Higher crude oil prices and volatility in prices is making bioethanol more cost competitive. Stable feedstock prices especially of sugarcane and corn is supporting ethanol producers.
  • Social: Rising environmental awareness and demand for cleaner fuels is influencing consumers to shift towards eco-friendly biofuels. Health benefits of ethanol blended gasoline are encouraging public to use such fuels.
  • Technological: Advanced technologies for cellulosic ethanol production from agricultural residues and waste is helping commercialization of second generation biofuels. Developments in engine technologies are enabling higher blending rates of ethanol in vehicles.

Regions of concentration

North America region accounts for the largest share of global bioethanol market value owing to strong support through policies like Renewable Fuel Standard. United States is the dominant producer of corn-based ethanol due to ample feedstock availability and focus on fuel security.

Fastest growing region

Asia Pacific region is expected to grow at fastest rate during the forecast period led by countries like Thailand, China and India. Increasing production of sugarcane and support through policies will drive the demand for bioethanol in transportation sector in these developing economies.

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it