Global Biofuels Market Projected to reach 286.9 Billion by 2033, Expanding at a CAGR of 7.9% | M2Square Consultancy

The Global Biofuels Market is entering a robust growth phase, propelled by increasing prevalence of coronary and peripheral artery disease, continual innovations in stent design and coatings, and expanding access to interventional cardiology services worldwide. According to M2Square Consultancy's latest research report, the market is projected to grow at a CAGR of 7.9% from 2025 to 2033, reaching an estimated value of USD 286.9 billion by 2033.

Biofuels, including ethanol, biodiesel, renewable diesel, biogas, bio-LNG, and emerging advanced feedstock-based fuels, are witnessing widespread adoption across the road transport, aviation, marine, and power-generation sectors. The industry is experiencing a transformative shift driven by:

●       Expansion of second-generation (2G) and third-generation (3G) biofuel technologies

●       Increasing mandates for blending in the U.S., Europe, India, Brazil, and Southeast Asia

●       Rapid growth in sustainable aviation fuel (SAF) and renewable marine fuels

●       Integration of AI, IoT, and smart biorefineries for better yield and process optimization

●       Rising investment in waste-to-fuel and algae-derived fuel projects

●       Corporate net-zero commitments are accelerating renewable fuel adoption

As global energy systems shift toward low-carbon solutions, biofuels have become a central pillar of national climate strategies, offering significant reductions in greenhouse gas emissions while supporting energy security and rural economic development.

Biofuels play an essential role in sectors where electrification alone cannot meet energy demand, such as aviation, long-haul transportation, heavy-duty commercial fleets, shipping, agriculture, and industrial combustion. The product ecosystem includes ethanol, biodiesel, renewable diesel, SAF, biogas/biomethane, and cellulosic fuels, along with technologies, enzymes, feedstocks, and associated services.

With governments and industry leaders targeting aggressive 2030 and 2050 emission milestones, the biofuels market is at a pivotal point. Technologies enabling cost reduction, feedstock diversification, and high-efficiency conversion will shape the next decade of market leadership.

North America Biofuels Market Insights

North America remains one of the most influential markets globally, driven by federal and state-level renewable fuel mandates, strong agricultural feedstock availability, and strategic investments in next-generation biorefineries. The U.S. Renewable Fuel Standard (RFS), California’s Low Carbon Fuel Standard (LCFS), and Canada’s Clean Fuel Regulations (CFR) are creating a strong policy foundation for the rapid scaling of bioethanol, biodiesel, renewable diesel, and Sustainable Aviation Fuel (SAF). The U.S. is among the world’s largest producers of ethanol, accounting for over 50% of global output, supported by maize-based feedstock and advanced fermentation technologies. Renewable diesel capacity has experienced exponential growth, with a more than five-fold increase in production since 2020, driven by high demand from commercial transportation fleets seeking low-carbon alternatives. The region is also emerging as a global hub for SAF production, with multiple new projects announced in California, Texas, and Louisiana, aiming to meet aviation industry decarbonization targets.

Key Market Highlights from the Report

●       Market Valuation: The market was valued at an estimated USD 120.4 billion in 2025.

●       Fuel Type: Ethanol dominates the global market share due to extensive use in gasoline blending, while Sustainable Aviation Fuel (SAF) is projected to grow at the highest CAGR through 2033.

●       Application: Transportation remains the largest application segment, driven by rising adoption in commercial fleets and aviation.

●       Leading Region: North America leads globally, while Asia Pacific is expected to grow the fastest due to expanding bioethanol blending mandates and rapid biorefinery investments.

Biofuels Market Segmentation

M2Square Consultancy has segmented the global biofuels market based on fuel type, form, feedstock, application, and region:

By Fuel Type

●       Ethanol

●       Biodiesel

●       Renewable Diesel

●       Biojets

By Form

●       Solid Biofuel

●       Liquid Biofuel

●       Gaseous Biofuel

By Feedstock

●       Corn

●       Sugarcane

●       Vegetables Oils

●       Other

By Application

●       Transportation

●       Aviation

●       Energy Generation

●       Heating

●       Others

By Region

●       North America

o   U.S.

o   Canada

●       Europe

o   U.K.

o   Germany

o   France

o   Italy

o   Spain

o   Switzerland

o   Rest of Europe

●       Asia Pacific

o   China

o   India

o   Japan

o   South Korea

o   Australia

o   Rest of APAC 

●       Latin America

o   Mexico

o   Brazil

o   Argentina

o   Rest of LATAM

●       Middle East & Africa

o   Saudi Arabia

o   UAE

o   South Africa

o   Rest of MEA

Key Market Players in the Biofuels Market

●       ADM

●       Chevron

●       Valero

●       Neste

●       Cargill, Incorporated

●       Wilmar International Ltd

●       VERBIO AG

●       Borregaard AS

●       POET, LLC

●       The Andersons, Inc.

●       Green Plains Inc.

●       BP p.l.c.

●       FutureFuel Corporation

●       Münzer Bioindustrie GmbH

●       Aemetis, Inc.

●       CropEnergies AG

●       Raízen

●       Blue Biofuels, Inc.

●       Pannonia Bio Zrt.

●       GreenJoules

●       Algenol

●       Others

Key Strategies by Biofuels Market Players

Waste-Based Feedstock Lock-in: Highly successful players like Neste focus on securing long-term contracts for waste and residue streams such as used cooking oil (UCO) and animal fats. This feedstock has superior carbon reduction scores and offers a cost advantage when UCO prices are stable.

SAF Production Commitment: Shifting capital investment and R&D focus toward producing Sustainable Aviation Fuel (SAF) using approved pathways, e.g., HEFA—Hydrotreated Esters and Fatty Acids, or ATJ—Alcohol-to-Jet. SAF, while currently expensive (up to five times the cost of jet fuel), benefits from massive industry and government mandates, guaranteeing future demand.

Implications for Stakeholders

●       Energy Companies & Biofuel Producers: Must focus on cost reduction, flexible biorefinery operations, and next-generation technology integration to stay competitive.

●       Governments & Regulators: Should continue expanding policy incentives, SAF mandates, and carbon-credit frameworks to support renewable fuel adoption globally.

●       Transportation, Aviation & Logistics Firms: Can significantly reduce carbon footprint by adopting renewable diesel, SAF, and bio-LNG—essential for meeting long-term ESG commitments.

About M2Square Consultancy

We specialize in decoding complexity. From market forecasting to customer behavior analysis, our services are designed to bridge the gap between uncertainty and opportunity. Our offerings span the entire insight lifecycle, including Consulting, Tailored Research, Syndicated Studies, Trend Tracking, Competitive Intelligence, Pricing and Channel analysis, GTM Strategy, and more. Using a blend of qualitative expertise and data science, we deliver bespoke solutions that inform bold business moves. Whether you’re entering a new geography, launching a product, or restructuring a business model, we help you understand the landscape before you leap. What makes us different is our obsession with relevance. We don’t deliver static reports; we craft stories backed by evidence, customized for your strategic needs. Our advanced data visualization capabilities bring research to life, turning complexity into clarity. In less than two years, we’ve worked with over 150 organizations across sectors like healthcare, ICT, finance, energy, and consumer goods, proving our commitment to impact, not just insight. We don’t just inform; we empower.

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