Biodiesel Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Biodiesel Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The market for biodiesel is expected to grow at a CAGR of more than 7% in the forecast period of 2020-2025. The volatility of crude oil prices and depleting fossil fuels are driving several nations across the globe to shift towards biofuels. The easy availability of feedstock, with supporting government policies in different countries, is driving the market for biodiesels. Also, the continuous goal to reduce carbon emissions is pushing different nations to replace or reduce the share of fossil-based fuels. On the other hand, shrinking land for agriculture and the availability of alternative clean energy sources are likely to restrain the growth of biodiesel in the forecast period.

Key Highlights

• Under application segmentation, the usage of biodiesel as a fuel Is dominating the market due to the acceptance of biodiesel as a blending agent in different nations across the globe.
• With nations like the United States, Germany, the United Kingdom giving stress on biodiesel blending, more countries like India and China are adopting such initiatives, which is expected to create ample market opportunities.
• Growing production in countries like Indonesia, China, Thailand is expected to drive the market of biodiesel in the Asia-Pacific region at a significant rate in the forecast period.

Key Market TrendsTransportation Application is Expected to Dominate the Market

• Biodiesel is a renewable, clean-burning diesel replacement that can be used in existing diesel engines without modification. It is made from an increasingly diverse mix of resources such as recycled cooking oil, agricultural feedstock, and animal fats.
• The United States is a significant consumer of biodiesel. Some local, state, and federal government agencies with fleets of school and transit buses, snowplows, garbage trucks, mail trucks, and military vehicles use biodiesel blends, usually B20. Fuelling stations that sell biodiesel blends of B20 or higher to the public are available in nearly every state.
• Biofuel consumption in EU transportation reached almost 17 Mtoe in 2018, compared to 15.4 Mtoe in 2017, an increase of 10.1% In 2019. Biodiesel comprised of % share of biofuel in European union in 2018.
• Global biofuel production has increased to 699 thousand barrels of oil equivalent per day. With the increasing mandates on the blend of biodiesel, the output is expected to increase significantly in the forecast period.
• Due to the fluctuating prices of petroleum-based products, biodiesel is becoming an increasingly affordable option. The share of biodiesel in transportation fuel is expected to increase considerably.

Asia-Pacific to Witness Significant Growth

• In December 2019, Indonesia became the first nation to mandate a B30 blend of palm-based fuel. The government allocated 9.59 million kiloliters of FAME for the B30 mandate in 2020, up from 6.63 million KL in 2019.
• In 2020, amid COVID-19 pandemic, The Indonesian government allocated USD 195 million from the state budget to subsidize producers of palm oil biodiesel, to boost the economy out of a pandemic-induced slump.
• On the other hand, in Malaysia, the mandate to manufacture biofuel with a 20% palm oil component - known as B20 witnessed a delay. The mandate is expected to be implemented across the country by mid-June 2021.
• India, with huge market potential, is aiming to increase the biodiesel share in the forecast period. The National Biofuel Policy of 2018 envisioned the formation of the supply chain or collection mechanisms to increase biodiesel production.
• With three new biodiesel plants in India, the total number of plants increased to 26 in 2019. The additional plants have increased the capacity significantly, and with upcoming projects, the production is likely to increase further.
• With the increasing blend percentage in countries like Malaysia, Thailand, and India, the Asia-Pacific region is expected to witness the highest growth rate in the forecast period.

Competitive Landscape

The biodiesel market is fragmented. Some of the major companies include Renewable Energy Group, Inc, Archer Daniels Midland Company, Bangchak Corporation Public Company Limited, Wilmar International Ltd, Neste Oyj.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

Companies Mentioned
 
Renewable Energy Group, Inc
Archer Daniels Midland Company
Bangchak Corporation Public Company Limited
Wilmar International Ltd
Neste Oyj
Cargill Inc
BIOX Corporation
Ag Processing, Inc.

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