Bioethanol Market by Feedstock (Starch based, Sugar based, Cellulose-based), Fuel blend (E5, E10, E15 to E70, E75& E85), End-use (transportation, pharmaceutical, cosmetic, alcoholic beverages), Generation and Region Global Forecast to 2028
Updated on : September 26, 2023
Bioethanol Market
The global bioethanol market is valued at USD 83.4 billion in 2023 and is projected to reach USD 114.7 billion by 2028, growing at 6.6% cagr during the forecast period. Bioethanol, obtained from biomass sources like corn, sugarcane, or cellulosic materials, has extensive applications across various industries. Its primary purpose lies in serving as a renewable fuel source. Bioethanol is frequently combined with gasoline to form ethanol-gasoline blends, which act as alternative fuels for transportation. These blends, known as E10 or E85, provide an environmentally friendly substitute to conventional gasoline, effectively diminishing greenhouse gas emissions and decreasing reliance on non-renewable fossil fuels. The global bioethanol market has been growing steadily in recent years and is expected to continue to grow in the coming years. The bioethanol market is segmented on the basis of feedstock such as starch-based, sugar-based, cellulose-based, and Others. The market of bioethanol has been segmented on the basis of end-use industries such as transportation, pharmaceutical, cosmetics, alcoholic beverages, and others.
Attractive Opportunities in the Bioethanol Market
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Bioethanol Market Dynamics
Driver: Need for energy security by countries
The pursuit of energy security frequently results in the implementation of supportive policies and incentives aimed at promoting bioethanol production and utilization. Companies operating in the bioethanol industry can leverage these favorable market conditions to expand their operations, boost production capacity, and explore new market prospects. Additionally, the drive for energy security compels bioethanol companies to invest in research and development endeavors, focusing on enhancing production processes, improving efficiency, and exploring advanced bioethanol production technologies. By embracing technological innovations, companies can position themselves as market leaders and effectively cater to the growing demand for bioethanol.
Restraint: Bioethanol blends, such as E10 or E85, may not be compatible with all vehicles.
Bioethanol blends, such as E10 or E85, may not be compatible with all vehicles. Some older or non-flex-fuel vehicles may not be designed to run on higher ethanol blends. As the number of EVs increases, manufacturers may focus less on developing and supporting vehicles capable of using bioethanol blends, limiting the market for such fuels. Government policies and incentives play a crucial role in shaping the market dynamics. If policymakers prioritize EVs and provide stronger incentives for their adoption, it can impact the demand for bioethanol negatively. Policy shifts that favor electric mobility over liquid biofuels may restrict the growth potential of the bioethanol industry.
Opportunities: The rising demand for bioethanol in the pharmaceutical industry
Bioethanol is used as an excipient or a solvent in the formulation of pharmaceutical drugs. It serves as a carrier for active ingredients, aiding in their dissolution and facilitating drug delivery. The pharmaceutical industry's increasing focus on solubility enhancement and drug delivery systems has led to a higher demand for bioethanol as an excipient. The rising demand for bioethanol in the pharmaceutical industry can be attributed to its role as an excipient in drug formulations, its effectiveness as a disinfectant, its use in extraction and purification processes, its application in pharmaceutical R&D, and its compliance with regulatory standards.
Challenges: Adverse environmental impact of bioethanol production
The expansion of bioethanol feedstock cultivation can lead to land use change, including the conversion of natural ecosystems such as forests, grasslands, and wetlands into agricultural land. This land conversion can result in deforestation, loss of biodiversity, and habitat destruction, leading to adverse environmental impacts. The environmental challenges requires sustainable practices in bioethanol production, including responsible land management, efficient water use, reduced chemical inputs, and the use of non-food feedstocks. It is crucial to strike a balance between bioethanol production and environmental conservation to ensure the overall sustainability of the bioethanol industry.
Bioethanol Market Ecosystem
By feedstock, starch based bioethanol projected to register the highest CAGR during the forecast period
starch is abundantly available in various agricultural crops such as corn, wheat, and barley, making it a widely accessible feedstock for bioethanol production. The abundance of starch feedstocks ensures a consistent and reliable supply, contributing to the dominance of starch-based bioethanol in the market. Starch-based bioethanol also benefits from the existing infrastructure and experience in the production and distribution of ethanol. Many countries already have established facilities and systems for producing bioethanol from starch feedstocks. This infrastructure includes ethanol plants, transportation networks, and blending facilities, which create a favorable market for starch-based bioethanol.
By End-Use Industry, pharmaceutical segment projected to register second highest CAGR during the forecast period.
The utilization of bioethanol in the pharmaceutical industry is driven by several factors, ensuring its widespread adoption and application. Firstly, bioethanol is recognized as a safe and compliant solvent for pharmaceutical purposes, meeting the stringent regulatory requirements and quality standards imposed on pharmaceutical products. Its use provides assurance in terms of safety and adherence to regulatory guidelines, making it a preferred choice for drug manufacturers. Bioethanol's ability to enhance solubility is another significant driver for its use in pharmaceuticals. As a solubilizing agent, bioethanol aids in dissolving hydrophobic active pharmaceutical ingredients (APIs), thereby improving the bioavailability and efficacy of drugs. This characteristic is particularly valuable for drugs with limited water solubility, as bioethanol facilitates their absorption and therapeutic effectiveness.
Asia Pacific is projected to account for the highest CAGR in the bioethanol market during the forecast period
The Asia-Pacific region has been experiencing significant economic growth over the past few decades. This growth has been driven by several factors, including increased trade and investment, improved infrastructure, and technological advancements. China, India, and Japan are among the largest economies in the Asia-Pacific region, and have been major drivers of economic growth in the region. In recent years, other countries such as Indonesia, Malaysia, and Vietnam have also emerged as important players in the regional economy. The growth of the bioethanol industry in the Asia Pacific region can be attributed to several factors. Firstly, the region has experienced rapid economic growth and urbanization, leading to an increased demand for energy. In order to meet this demand, countries in the region are seeking renewable and cleaner alternatives to fossil fuels, making bioethanol an attractive option. Government bodies and policymakers in the Asia Pacific region have recognized the potential of bioethanol and are actively promoting its use as part of their energy diversification strategies. These supportive policies and initiatives have created a favorable environment for the growth of the bioethanol industry.
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Bioethanol Market Players
Bioethanol comprises major manufacturers such as POET LLC (US), Archer Daniels Midland Company (US), Green Plains (US) and Valero Energy (US), Pacific Ethanol (US) The Anderson Inc. (US), Flint Hills Resources (US), Tereos (France) were the leading players in the bioethanol industry. Expansions, acquisitions, joint ventures, and new product developments are some of the major strategies adopted by these key players to enhance their positions in the bioethanol market.
Bioethanol Market Report Scope
|
Report Metric |
Details |
|
Market Size Value in 2023 |
USD 83.4 billion |
|
Revenue Forecast in 2028 |
USD 114.7 billion |
|
CAGR |
6.6% |
|
Market size available for years |
2021–2028 |
|
Base year |
2022 |
|
Forecast period |
2023–2028 |
|
Unit considered |
Value (USD Million/Billion), Volume (Million liters) |
|
Segments |
Feedstock, Generation, Fuel blend, End-Use Industry, and Region. |
|
Regions |
Asia-Pacific, North America, Europe, South America, and Middle East & Africa |
|
Companies |
The major players are POET LLC (US), Archer Daniels Midland Company (US), Green Plains (US) and Valero Energy (US), Pacific Ethanol (US) The Anderson Inc. (US), Flint Hills Resources (US), and Tereos (France) and others covered in the Bioethanol market. |
This research report categorizes the global Bioethanol market on the basis of Feedstock, Generation, Fuel blend, End-Use Industry, and Region.
On the basis of feedstock:
- Starch Based
- Sugar Based
- Cellulose Based
- Others
On the basis of fuel generation:
- First Generation
- Second Generation
- Third Generation
On the basis of fuel blend:
- E5
- E10
- E15 TO E70
- E75 TO E85
- Others
On the basis of end-use industry:
- Transportation
- Alcoholic Beverages
- Cosmetics
- Pharmaceuticals
- Others
On the basis of region:
- North America
- Europe
- Asia Pacific
- Middle East and Africa
- South America
Recent Developments
- In January 2022, Wolf carbon solutions and Archer Daniels Midland Company (US) partner to advance the decarbonization of ethanol production.
- In October 2021, Archer Daniels Midland Company (US) announced that it has reached an agreement to sell its ethanol production complex in Peoria, Illinois, to BioUrja Group.
- In April 2023, POET LLC. (US) announced the signing of an exclusive partnership agreement with Midwest Commodities in Detroit, Michigan. Midwest Commodities will provide DDGS truck-to-container transload services solely to the company so that the company can more efficiently serve its global customer base.
- In January 2023, United Airlines, Tallgrass, and Green Plains Inc. (US) today announced a new joint venture – Blue Blade Energy – to develop and then commercialize a novel Sustainable Aviation Fuel (SAF) technology that uses ethanol as its feedstock.
Frequently Asked Questions (FAQ):
What are the major drivers driving the growth of the Bioethanol market?
The major driver influencing the growth of the Bioethanol market are rising use of bioethanol in various end-use industries majorly in the transportation and pharmaceutical industry.
What are the major challenges in the Bioethanol market?
The major challenge in the Bioethanol market is price volatility and availability of feedstock.
What are the restraining factors in the Bioethanol market?
The major restraining factor faced by the Bioethanol market is the rising demand for EVs.
What is the key opportunity in the Bioethanol Market?
The policy changes regarding the use of bioethanol have a new opportunity for the Bioethanol market.
What are the end-uses of Bioethanol?
It is primarily used as a fuel additive or blended with gasoline in the transportation sector, where it reduces greenhouse gas emissions and decreases dependence on fossil fuels. Bioethanol is also used in pharmaceuticals & cosmetics. .
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This research involved the use of extensive secondary sources and databases, such as Factiva and Bloomberg, to identify and collect information useful for a technical and market-oriented study of the Bioethanol market. Primary sources included industry experts from related industries and preferred suppliers, manufacturers, distributors, technologists, standards & certification organizations, and organizations related to all segments of the value chain of this industry. In-depth interviews have been conducted with various primary respondents, such as key industry participants, subject matter experts (SMEs), executives of key companies, and industry consultants, to obtain and verify critical qualitative and quantitative information as well as to assess growth prospects.
Secondary Research
In the secondary research process, various sources such as annual reports, press releases, and investor presentations of companies; white papers; and publications from recognized websites and databases have been referred to for identifying and collecting information. Secondary research has been used to obtain key information about the industry's supply chain, the total pool of key players, market classification and segmentation according to the industry trends to the bottom-most level, regional markets, and key developments from both market-and technology-oriented perspectives.
Primary Research
The Bioethanol market comprises several stakeholders in the supply chain, which include suppliers, processors, and end-product manufacturers. Various primary sources from the supply and demand sides of the markets have been interviewed to obtain qualitative and quantitative information. The primary participants from the demand side include key opinion leaders, executives, vice presidents, and CEOs of companies in the Bioethanol market. Primary sources from the supply side include associations and institu tions involved in the Bioethanol industry, key opinion leaders, and processing players.
Following is the breakdown of primary respondents
Notes: Others include sales, marketing, engineers, and product managers.
Tier 1= USD 1 Billion; Tier 2 = below USD 1 Billion to USD 500 Million; and Tier 3 = Below USD 500 Million.
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Market Size Estimation
Both top-down and bottom-up approaches were used to estimate and validate the size of the global Bioethanol industry. The research methodology used to estimate the market size includes the following:
- The key players in the industry were identified through extensive secondary research.
- The supply chain of the industry and market size, in terms of value, were determined through primary and secondary research.
- All percentage shares split, and breakdowns were determined using secondary sources and verified through primary sources.
- All possible parameters that affect the markets covered in this research study were accounted for, viewed in extensive detail, verified through primary research, and analyzed to obtain the final quantitative and qualitative data.
- The research includes the study of reports, reviews, and newsletters of key industry players along with extensive interviews with key officials, such as directors and marketing executives.
Market Size Estimation: Bottom-Up Approach
Data Triangulation
After arriving at the total market size from the estimation process explained above, the overall market was split into several segments and subsegments. To complete the overall market size estimation process and arrive at the exact statistics for all segments and subsegments, data triangulation and market breakdown procedures have been employed, wherever applicable. The data have been triangulated by studying various factors and trends from both the demand and supply sides. In addition, the market size has been validated by using both the top-down and bottom-up approaches.
Market Definition
The bioethanol industry refers to the global industry involved in the production, distribution, and consumption of bioethanol as a renewable and sustainable fuel. Bioethanol, also referred to as ethanol, is an alcohol-based fuel derived from biomass sources, including crops, agricultural residues, and waste materials. The production process involves the fermentation of sugars present in biomass, converting them into ethanol through the action of yeast or bacteria. Bioethanol is commonly utilized as a substitute or additive for gasoline, aiming to reduce greenhouse gas emissions and promote cleaner energy options. The bioethanol market encompasses various participants, such as bioethanol producers, feedstock suppliers, fuel distributors, and end-users like the automotive and transportation industries. The growth of the bioethanol industry is driven by factors like heightened environmental concerns, government regulations, energy security objectives, and the global transition towards renewable energy alternatives.
Key Stakeholders
- Raw Material Suppliers and Producers
- Regulatory Bodies
- End User
- Research and Development Organizations
- Industrial Associations
- Bioethanol manufacturers, dealers, traders, and suppliers.
Report Objectives
- To define, describe, and forecast the global Bioethanol market in terms of value and volume.
- To provide insights regarding the significant factors influencing the growth of the market (drivers, restraints, opportunities, and challenges)
- To analyze and forecast the market based on type, raw material, end-use industry, region, and application.
- To forecast the market size, in terms of value and volume, with respect to four main regions: North America, Europe, Asia Pacific, South America, and Middle East & Africa.
- To analyze the opportunities in the market for stakeholders and provide details of the competitive landscape.
- To strategically profile key players in the market.
- To analyze competitive developments in the market, such as new product launches, capacity expansions, and mergers & acquisitions.
- To strategically profile the leading players and comprehensively analyze their key developments in the market.
The market has been further analyzed for the key countries in each of these regions.
Available Customizations:
Along with the given market data, MarketsandMarkets offers customizations as per the specific needs of the companies. The following customization options are available for the report:
Product Analysis:
- Product Matrix which gives a detailed comparison of the product portfolio of each company
Regional Analysis:
- Further breakdown of the Rest of the APAC Bioethanol market
- Further breakdown of the Rest of Europe’s Bioethanol market
Company Information:
- Detailed analysis and profiling of additional market players (up to 5)
Growth opportunities and latent adjacency in Bioethanol Market