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The global cellulosic ethanol market size is estimated to grow by USD 9.60 billion between 2023 and 2028 at a CAGR of 67.86%. Market expansion hinges on various factors, notably escalating apprehensions regarding food security, heightened concerns about environmental and energy security, and an increasing demand for renewable and clean fuel sources. These dynamics are shaping the trajectory of industries involved in sustainable agriculture, eco-friendly energy production, and innovative fuel technologies. The drive towards addressing food scarcity issues, mitigating environmental impacts, and transitioning to sustainable energy sources is propelling the growth of sectors focused on renewable resources, green technologies, and efficient energy management practices. As global awareness of these challenges grows, industries are compelled to invest in solutions that promote sustainability and reduce the reliance on traditional, non-renewable resources.
Cellulosic ethanol is produced from cellulosic biomass with raw materials such as agricultural waste and residues, grasses, forest residues, wood chips, plants, energy crops, and organic MSW. The raw materials are widely available and have a significant carbohydrate content. The complex sugars are converted to simpler forms using hydrolysis techniques such as enzyme and acid hydrolysis. Cellulosic ethanol can also be produced by the gasification process of lignocellulosic raw materials.
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The market is driven by the increasing focus on renewable energy and sustainable agriculture practices. Key trends include advancements in biorefinery technology and biomass conversion efficiency, leading to improved ethanol production processes. Challenges such as optimizing biorefinery economics and addressing biomass pretreatment complexities remain. Additionally, meeting stringent renewable fuel standards and ensuring carbon footprint reduction are critical factors shaping the market's trajectory. The rising demand for ethanol derived from cellulosic biomass reflects a global commitment to climate change mitigation and energy sustainability. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers, trends, and challenges will help companies refine their marketing strategies to gain a competitive advantage.
The rising need for renewable clean fuel is driving the market growth. Alternative fuels are gaining popularity worldwide due to various factors, such as unpredictable global fuel prices, energy security concerns, and rising levels of emissions. Consequently, there is a growing demand for fuels that can reduce carbon emissions while still being commercially viable. To address this need, renewable biofuels have emerged as a potential solution as they can gradually replace the diminishing fossil fuel reserves. With continuous research and development, biofuels are now being scaled up for commercial use due to their performance capabilities similar to conventional gasoline and diesel.
Moreover, biofuel blends are being used in regular vehicles with minimal to no modifications required, which is further encouraging the use of blended fuels in vehicles. These biofuels produce less greenhouse gas emissions than traditional fuels, depending on the blend. Additionally, cellulosic ethanol is capable of reducing sulfur and hydrocarbon emissions, making it an attractive alternative to conventional fuel. Given the numerous benefits of this over conventional fuel, the demand for this fuel is expected to increase during the forecast period, making it a mainstream fuel worldwide.
The global market faces a significant challenge in terms of securing a sufficient supply of feedstock in large enough quantities. Non-food crops, agricultural waste, forest residues, energy crops, and organic MSW products are all vital sources of feedstock for cellulosic ethanol. However, to achieve economies of scale, the industry must operate on a large scale, which requires a continuous and reliable supply of feedstock.
Maintaining a steady supply of feedstock is challenging, as feedstock prices are rising in the market, and harsh weather conditions can impact feedstock production. The availability and accessibility of feedstock may prove to be a significant obstacle for the industry. Furthermore, the declining prices of petrochemicals may impede the growth of the global market during the forecast period.
Alternative to conventional transportation fuels is a major trend driving the market growth. Cellulosic ethanol is also called grain alcohol. It has similar physical and chemical properties as that of conventional fuel and has the potential to replace conventional transportation fuel such as gasoline. The benefits of cellulosic ethanol are:
Reduction in greenhouse gas: It is commonly termed carbon neutral because it does not release any surplus carbon content. Plants and agricultural non-food crops absorb the same carbon content, which they release during fuel combustion, thus maintaining the carbon emission balance. These factors are expected to drive the growth of the market in focus during the forecast period.
The market share growth by the energy crops segment will be significant during the forecast period. Energy crops are used to produce cellulosic ethanol and other biofuels such as ethanol, propanol, and butanol. These are non-food crops, which require low cost and lesser maintenance to produce.
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The energy crops segment was valued at USD 56.10 million in 2017 and continued to grow until 2021. Energy crops can be segmented into two subcategories, that are, woody and herbaceous. Herbaceous energy crops mainly include grasses such as Arundo donax, Andropogon gerardii, Miscanthus giganteus, Panicum virgatum or switchgrass, elephant grass, and sweet sorghum. Woody energy crops are fast-growing trees such as poplar, sweetgum, silver maple, black locust, eucalyptus, and willow. They can also be used in the paper and pulp industry, and the leftovers or by-products can be used for cellulosic ethanol production. Woody energy crops generally produce 2%-10% more wood biomass per acre in comparison with natural forest trees. The increasing requirement for biomass to produce renewable fuels and growing awareness to minimize greenhouse gas and carbon emissions are expected to boost the demand for energy crops as a biofuel feedstock during the forecast period.
The gasoline segment is projected to experience the most significant growth in the market during the forecast period. Factors contributing to this expansion include the increasing demand for automobiles and population growth. According to the Society of Indian Automobile Manufacturers, there was a notable increase in exports of passenger vehicles (from 404,397 to 577,875 units), commercial vehicles (from 50,334 to 92,297 units), three-wheelers (from 393,001 to 499,730 units), and two-wheelers (from 3,282,786 to 4,443,018 units) compared to the previous year.
APAC is estimated to contribute 34% 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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Another significant region contributing to the market is North America. The biofuel production sector is witnessing significant advancements with the emergence of alternative fuel sources, such as cellulosic ethanol, in the global energy landscape. The bioenergy industry is experiencing a paradigm shift towards the utilization of cellulosic feedstocks, including lignocellulosic biomass, for the production of bioethanol. This transition is driven by the need for energy security, climate change mitigation, and sustainability. The Americas dominate the biofuel market, particularly in the production of cellulosic ethanol. Key producers in the region include the US, Brazil, Canada, and Argentina. The US government's support through special loans, funds, and grants has led to extensive research and development in advanced biofuels technology and processing. This has resulted in increased biomass conversion efficiency, improved biorefinery economics, and optimization of biorefinery technology. Such factors will increase the market growth in this region during the forecast period.
companies are implementing various strategies by analyzing factors such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product or service launches to enhance their presence in the market.
GranBio Investimentos S.A. - The key offerings of the company include cellulosic ethanol for personal care ingredients and industrial purposes. The company is involved in the production of biofuels, biochemicals, and advanced renewable materials.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market forecasting report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Million" for the period 2024-2028, as well as historical data from 2018 - 2022 for the following segments.
The market is at the forefront of sustainable fuel production, leveraging biomass conversion technologies and biorefinery advancements. As part of the broader bioenergy industry, cellulosic ethanol plays a crucial role in addressing climate change mitigation and promoting energy sustainability. This innovative fuel source is derived from cellulosic biomass, offering significant environmental benefits and contributing to carbon footprint reduction. Key components of the market include biorefinery economics and optimization, which focus on enhancing biomass conversion efficiency and pretreatment methods. The development of advanced biofuels and alternative fuel sources like cellulosic ethanol is driven by the need for renewable energy solutions that meet renewable fuel standards. In the Bioethanol market, Cellulosic ethanol production costs will also affect the growth.
Moreover, technological advancements in biorefinery technology and cellulosic ethanol production have led to reduced production costs and improved ethanol extraction processes. Enzymatic hydrolysis and fermentation are key steps in the cellulosic ethanol production process, utilizing lignocellulosic feedstock and microbial conversion for efficient fuel generation. The market is witnessing increased demand for cellulosic ethanol applications, particularly in sectors focused on sustainable fuel for transportation and industrial use. With ongoing research and development, cellulosic ethanol is poised to play a significant role in the transition toward a more sustainable and renewable energy future.
Furthermore, the market is a pivotal segment within biofuel production and renewable energy sources. It involves sophisticated processes like biomass pretreatment, biorefinery optimization, and biorefining processes to convert cellulosic feedstock into valuable ethanol. One of the key challenges has been managing cellulose degradation effectively to enhance cellulosic ethanol production and reduce production costs. Advancements in cellulosic ethanol technology have significantly improved the fermentation process using yeast fermentation, leading to more efficient ethanol distribution channels. This has bolstered the market's appeal as a sustainable alternative to traditional fossil fuels.
Market Scope |
|
Report Coverage |
Details |
Page number |
177 |
Base year |
2023 |
Historic period |
2018 - 2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 67.86% |
Market growth 2024-2028 |
USD 9.60 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
48.67 |
Regional analysis |
North America, APAC, Europe, South America, and Middle East and Africa |
Performing market contribution |
APAC at 34% |
Key countries |
US, Brazil, Germany, Canada, and China |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
BlueFire Renewables Inc., Borregaard ASA, Clariant International Ltd., COFCO Corp., DuPont de Nemours Inc., ENERKEM Inc., Eni SpA, Fiberight LLC, GranBio Investimentos SA, Green Plains Inc., INEOS AG, Iogen Corp., Novonesis Group, Orsted AS, POET LLC, Praj Industries Ltd., Shandong Longlive Bio-technology Co. Ltd., Shell plc, VERBIO Vereinigte BioEnergie AG, and Vertex Bioenergy SL |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Feedstock
7 Market Segmentation by Application
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Opportunity/Restraints
11 Competitive Landscape
12 Competitive Analysis
13 Appendix
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