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The biodiesel market size is forecast to increase by USD 16.71 billion, at a CAGR of 7.38% between 2023 and 2028. The report includes historic market data from 2018 - 2022. The market is witnessing a growing demand for biofuel from spent bleaching earth, the growing demand for biodiesel in India, and the expansion of advanced biodiesel.
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A key factor shaping the market growth is the biofuel from spent bleaching earth. Over the years, the use has increased due to its advantages such as the cost benefits, renewable, clean, and reduced level of pollution. However, the market growth is hampered by its high cost of production. Therefore, to overcome this, manufacturers are trying to adopt strategies such as the use of an efficient catalyst, cheap raw materials, and advanced technologies.
Moreover, the bleaching clay used for the refining process in the oil industry contains 25-40% oil. In addition, these are disposed into the environment through various techniques. Furthermore, this spent bleaching clay has been recycled using the base-catalyzed transesterification technique to produce biofuel at a reduced raw material cost. Hence, such factors are driving the market growth during the forecast period.
The transport fuel segment is estimated to witness significant growth during the forecast period. Biodiesel is the best substitute for regular diesel for diesel engines. In addition, the biggest advantage over gasoline and petroleum diesel is that it is environment-friendly. Furthermore, it has better efficiency in CI engines than gasoline.
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The transport fuel segment was the largest segment and was valued at USD 25.90 billion in 2018. Moreover, in Europe, biodiesel accounts for more than 80% of the biofuel market, as its use in automobiles is increasing. In addition, the rising use of this product in this region is promoting market growth as an alternative fuel. Furthermore, in India, it is on the verge of growth, as the country has been continuously investing in the manufacturing, which will increase its use in the transportation industry. For instance, states, such as Karnataka, have already started operating buses using this type of diesel, which will help reduce greenhouse gases in the country to some extent. Hence, such factors are driving the growth of this segment which in turn drives the market growth during the forecast period.
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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. Its production in Indonesia has been increasing since 2016 due to the new reference price for calculating subsidies. In addition, production will increase due to the rising domestic blending requirements, with exports remaining marginal. Moreover, in developing countries such as India, the adoption will grow in the coming years. In addition, this is attributed to the expansion of biofuel plants, from which a major portion of the production is expected to happen in the coming years. Furthermore, the Government of India has also been encouraging oil manufacturing companies to invest in the biofuel industries. Hence, such factors are driving the market growth in APAC during the forecast period.
One of the key factors driving the market growth is the positive impact on the environment. The use in different end-user industries has helped to reduce greenhouse gas emissions. In addition, it produces carbon dioxide, which is absorbed by plants during photosynthesis. Furthermore, it is used along with petroleum diesel to create a balanced energy policy to keep the environment free from harmful pollutants such as NOx.
Moreover, biodiesel is non-toxic, biodegradable, and safe to handle and transport. In addition, the US Environment Protection Agency (EPA) has been mandated to use biodiesel, as there are regulations on the use of ethanol and biodiesel in the US. Hence, such factors are positively impacting the market. Therefore, it is expected to drive the market growth during the forecast period.
Growing demand for electric vehicles in the automotive industry is one of the key challenges hindering market growth. It is a major substitute for petroleum diesel for automotive engines. However, due to its poor fuel efficiency, it is less suitable for low-temperature applications. Furthermore, several other drawbacks affect the overall performance efficiency of automobiles.
Moreover, due to the requirement of high engine efficiency, electric vehicles have gained popularity in Europe and North America. In addition, the use of electric vehicles around the globe has hindered the growth of the global market. Furthermore, the alternative use of electric vehicles will have a negative impact on the global market growth. Hence, such factors are hindering the market growth during the forecast period.
The market research report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Altenesol LLC: The company offers biodiesel such as B100, B20, and B5 which are used in injection pump diesel engines, extreme high pressure common rail engines, and generators.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative market growth 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 report forecasts market growth by revenue at global, regional & country levels and provides a market research and growth analysis of the latest market trends and analysis and growth opportunities from 2018 to 2028.
The market is driven by the increasing demand for eco-friendly alternatives to fossil fuels in automotive applications. Derived from agricultural feedstock such as vegetable oils, poultry, tallow, and white grease, biodiesel offers compatibility with existing infrastructure and reduces greenhouse gas emissions compared to traditional fuels like crude oil. Government mandates and incentives further boost production capacity and research and development efforts in biodiesel technology.
Used cooking oil (UCO), rapeseed, and palm oil production contribute significantly to biodiesel production, catering to power generation applications and the marine industry. As governments prioritize renewable energy sources and mechanization in the agricultural sector, biodiesel emerges as a sustainable solution to address the demand-supply gap while mitigating the environmental impact of volatile organic compounds (VOCs) associated with fossil fuels.
Market Scope |
|
Report Coverage |
Details |
Page number |
167 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 7.38% |
Market Growth 2024-2028 |
USD 16.71 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
7.28 |
Regional analysis |
APAC, North America, Europe, South America, and the Middle East and Africa |
Performing market contribution |
APAC at 49% |
Key countries |
US, Indonesia, Thailand, India, and Brazil |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Aemetis Inc., Ag Processing Inc., Altenesol LLC, Archer Daniels Midland Co., Argent Energy UK Ltd., AVRIL SCA, Bunge Ltd., Cargill Inc., Chevron Corp., Crimson Renewable Energy LLC, FutureFuel Corp., KFS Biodiesel GmbH and Co. KG, Kotyark Industries Ltd., Louis Dreyfus Co. BV, Munzer Bioindustrie GmbH, Neste Corp., PTT Global Chemical Public Co. Ltd., RB FUELS, Vance Group Ltd., and Wilmar International Ltd. |
Market dynamics |
Parent market analysis, market growth and trends, Market forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the 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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