Ethanol Biofuel Market Size - By Feedstock, By Application, Analysis, & Forecast, 2025 - 2034

Ethanol Biofuel Market Size

The global ethanol biofuel market was valued at USD 72.5 billion in 2024 and is estimated to reach the value of USD 206.1 billion by 2034, growing at a CAGR of 11% from 2025 to 2034. Ethanol biofuel is increasingly becoming a cleaner fuel option compared to gasoline in road transport. A mix of ethanol with gasoline lowers toxic tailpipe emissions, including carbon monoxide and particulate matter, and raises the fuel octane levels. Governments and consumers prefer ethanol-blended fuels including E10 (10% ethanol) and E85 (85% ethanol) due to their reduced environmental footprint and compatibility with current vehicles.
 

International efforts against climate change have driven increased need for low-carbon fuels and ethanol releases a maximum of 43% greenhouse gases than gasoline throughout its lifetime, which in turn is resulting in higher product consumption. Governments and industries use ethanol as a better method of decarbonizing industries including transportation, where electrification is not feasible. As a reference, in 2023, Stockholm substituted 200 diesel buses with ethanol fueled models using E95 (95% ethanol) produced from timber waste and cuts CO? emissions by 90% over diesel.
 

Governments are leading the adoption of ethanol by providing funding for R&D in advanced biofuels and policies incorporating tax credits, subsidies, and fuel blending requirements. These actions reduce costs of production, enhance innovation, and ensure ethanol has stable markets. For instance, the U.S. Department of Energy released USD 200 million in 2023 to speed up cellulosic ethanol manufacturing from agricultural waste including corn stover. Such projects as POET's "Project LIBERTY" in Iowa utilize this investment to enhance processes that take 770,000 tons of agricultural waste and produce 25 million gallons of ethanol per year.
 

Technological advancements are increasing the efficiency and sustainability of ethanol production. Additionally, advances in enzyme systems and fermentation processes allow producers to convert agricultural waste including corn stalks and wheat straw into fuel, reducing reliance on food crops. For instance, DuPont and Novozymes have released enzyme solutions that improved the conversion of agricultural waste into ethanol, with commercial applications expanded in the year 2023.
 

Ethanol Biofuel Market Trends

The ethanol biofuel industry is shifting increasingly away from first-generation feedstocks towards second-generation feedstocks including agricultural residues and forest residues. Advanced feedstocks tap into non-food biomass, taking pressure off arable land and allowing farmers to profit from crop waste. For instance, in 2023, Clariant AG rolled out its Sunliquid technology in Romania, turning 250,000 tons of wheat straw per year into 50,000 tons of cellulosic ethanol. This project not only offers a renewable source of fuel but also cuts greenhouse gas emissions by 95% relative to fossil fuels.
 

Governments around the globe are introducing ethanol blending requirements and tax credits to cut fossil fuel reliance and achieve climate goals. Such policies provide secure demand, draw investments, and make ethanol a central part of national energy plans. For instance, Brazil, raised its ethanol blend requirement to 27.5% in 2024, mandating almost one-third of all gasoline sold to include ethanol. This policy encouraged sugarcane growers and refineries to increase production, with Brazil's ethanol production rising to 36 billion liters in 2024 sufficient to fuel 20 million cars every year.
 

The aviation industry is adopting ethanol-derived sustainable aviation fuel (SAF) to transition to a lower-carbon economy. SAF has lifecycle emissions reduced by as much as 80% compared to traditional jet fuel, in line with net-zero ambitions worldwide. For instance, in 2024, Delta Airlines and Gevo Inc. entered a partnership to deliver 75 million gallons of ethanol-based SAF each year by 2026. The USD 2.5 billion deal will fuel 10,000 transatlantic flights every year, demonstrating ethanol's position in making air travel greener.
 

Industries are incorporating ethanol manufacturing into circular economies by recycling waste streams into fuel. This helps cut emissions, waste less, and generates new money for polluting sectors. For instance, LanzaTech's 2025 plant in Japan captures the carbon emissions of steel mills and ferments them into 100 million liters of ethanol per year from gas fermentation. The process reduces 200,000 tons of CO? annually approximately removing 50,000 cars off the roads and provides ethanol to fuel, plastic, and textile industries.
 

Ethanol Biofuel Market Analysis

• The global market for ethanol biofuel was valued at USD 58.5 billion, USD 65.7 billion, and USD 72.5 billion in 2022, 2023 and 2024, respectively. The application industry is categorized into transportation, aviation, and others.
   
• Ethanol is commonly blended with gasoline to produce cleaner fuels such as E10 (10% ethanol) and E20 (20% ethanol) that lower carbon monoxide and particulate emissions. These blends are encouraged by governments through mandates, with backing from flex-fuel vehicles capable of operating on high ethanol blends. For instance, The Ethanol Blended Petrol scheme in India reached a 12% country-wide level of ethanol blending in 2023, rising from 5% in 2020. This increase, fueled by abundant sugarcane and grains, lowered crude oil imports by USD 4 billion per year and reduced CO? emissions by 18 million tons.
   
• The aviation industry is embracing SAF produced from ethanol to achieve net-zero. Ethanol-based SAF reduces lifecycle emissions by a maximum of 80% when compared to conventional jet fuel, providing a scalable decarbonization route. For instance, in 2024, United Airlines partnered with Aemetis to buy 1 billion gallons of ethanol-based SAF over 10 years which is produced from agricultural residues. This SAF will fuel 50,000 flights per year, reducing United's carbon footprint by 10 million tons by 2035.
   

• Based on feedstock ethanol biofuel market is segmented into coarse grain, sugar crops, vegetable oil and others. The coarse grains segment accounted for over 34.9% revenue share in 2024 owing to their high starch content, are an efficient source for conversion to fermentable sugar, which is best for large-scale biofuel facilities.
   
• Government policy including blending requirements and farm subsidies, further increases their use. For instance, in Canada, wheat is a primary ethanol feedstock under federal Renewable Fuels Regulations, which mandate a 5% ethanol mix in gasoline. Terra Grain Fuels in Saskatchewan convert 150,000 tons of wheat every year to make 150 million liters of ethanol, lowering emissions by 30% over gasoline.
   
• Sugar crops including cassava and sugarcane are cultivated in tropical environments, providing quick ethanol yields due to their naturally high sugar content. These feedstocks play a crucial role in the decarbonization of energy systems in developing economies. For instance, 2024, Indonesian company P.T. Molindo Raya Industrial commissioned a sugarcane ethanol facility in East Java, converting 1 million tons of sugarcane a year into 400 million liters of ethanol.
   
• Vegetable oil feedstocks including palm and rapeseed oil are on the rise for biodiesel-ethanol hybrids, especially in waste-to-energy models prioritized in regions. In 2022, Felda Global Ventures in Malaysia commissioned a biorefinery in Johor that processed 500,000 tons of palm oil byproducts a year into 200 million liters of ethanol. This project reduces dependence on crude palm oil exports and is in line with Malaysia's National Biofuel Policy's aim of a 20% biodiesel blend by 2025.
   

• As of 2024, the U.S. ethanol biofuel market in 2022, 2023, and 2024 was valued at USD 22 billion, USD 24.6 billion, and USD 27.3 billion, respectively. The Renewable Fuel Standard (RFS) requires blending 15 billion gallons of ethanol per year into gasoline, providing consistent demand, which in turn is bolstering the product consumption in the U.S. market, thereby adding growth to the market.
   
• Europe focuses on second-generation ethanol from waste of agriculture to meet the EU's Renewable Energy Directive, requiring transport to be covered by 29% of renewables by 2030. Clariant AG launched a cellulosic ethanol refinery in Romania in 2023, which uses 250,000 tons of wheat straw each year to produce 50,000 tons of ethanol. Emissions decrease 95% compared to fossil fuels and comply with the circular economy of the EU.
   
• The Asia-Pacific region is increasing ethanol production to curb oil imports and pollution. India's Ethanol Blended Petrol (EBP) plan aims at 20% blending by 2025, based on surplus sugarcane and grains. In 2024, Praj Industries installed a dual-feedstock plant in Maharashtra, India, which makes 150 million liters of ethanol every year from sugarcane and rice straw. This reduces India's crude oil imports by USD 1.2 billion annually and lowers CO? emissions by 1 million tons.
   
• Latin America excels in ethanol production with Brazil dominating the market, supplying 35% of world ethanol from sugarcane. Its E27.5 blend mandate 27.5% ethanol in gasoline and flex-fuel vehicle take-up 90% of new vehicles ensure ethanol is an everyday fuel. In 2024, Raízen launched a USD 1 billion sugarcane ethanol plant in Sao Paulo, converting 18 million tons of sugarcane per year into 2.2 billion liters of ethanol. This plant fuels 3 million flex-fuel cars and reduces Brazil's oil imports by 10%.
   
• Middle East & Africa uses small-scale ethanol facilities to relieve energy poverty. Cassava and sorghum are typical feedstocks, well adapted to dry climates and dispersed infrastructure. For instance, Biofuel Africa Ltd. in Kenya installed 20 modular ethanol units in 2023, converting cassava into 5,000 liters of ethanol per day per unit. They offer clean cooking fuel to 50,000 homes, mitigating deforestation and kerosene reliance.
   

Ethanol Biofuel Market Share

The top 5 companies POET LLC, Archer Daniels Midland (ADM), Valero Energy Corporation, Green Plains, and Raízen dominate the ethanol biofuel sector and collectively control a sizeable share of the worldwide market holding about 40% share. To effectively manufacture ethanol and biodiesel, these businesses have set up vast production networks and made significant investments in ultramodern technologies.
 

POET LLC is within the top rank of ethanol biofuel markets using corn as its main feedstock, the U.S. based company with 33 units primarily in the Midwest, produced more than 2.7 billion gallons of ethanol in 2023. For reference, its leadership in January 2024, POET joined forces with Summit Carbon Solutions to connect its biofuel production to the biggest carbon capture facility in the world, so reducing emissions even more.
 

Ethanol Biofuel Market Companies

• ADM is a key player in the ethanol biofuel industry, converting corn into ethanol for cleaner fuel. It produced millions of gallons throughout its US plants in 2023, helping to power cars and reduce emissions. For instance, in 2022, when ADM collaborated with Gevo to create sustainable aviation fuel from ethanol, proving its expansion into new markets. Its strong farming links and large infrastructure keep it at the forefront of biofuel production.
   
• Valero produces ethanol to fuel vehicles and minimize pollution, working 13 plants in the United States. In 2023, it supported a consistent output of approximately 1.6 billion gallons, making it a prominent participant in the Mid-Continent region. Valero will collaborate with BlackRock and Navigator on a carbon capture project in 2021 to prove its commitment to the environment. Its emphasis on low-carbon fuels makes it competitive in the ethanol biofuel market.
   
• Green Plains produces ethanol and promotes renewable energy, particularly in transportation and aviation. In 2022, it produced more than 1 billion gallons of ethanol, demonstrating its importance in the US market. In 2023, it formed Blue Blade Energy with United Airlines and Tallgrass to produce aviation fuel from ethanol, a wise decision for the future. Its work with corn and innovative technology has made it a biofuels industry leader.
   
• Raízen, set up in Brazil, uses sugarcane to generate ethanol, powering cars and reducing fossil fuel consumption. In 2022, it generated millions of gallons and agreed to provide Shell with second-generation ethanol until 2037, with plans to develop five further facilities. In 2024, Raízen collaborated with BYD to promote electric transportation in Brazil, combining biofuels and green technology. Its large production ability and environmental focus make it critical in the ethanol biofuel market.
   

Key market players running across the ethanol biofuel industry are:

• ADM
• Borregaard
• Blue Biofuel
• BTG Bioliquids
• Cargill
• Chevron
• Clariant
• COFCO
• CropEnergies
• Munzer Bioindustrie
• Neste
• POET LLC
• Praj Industries
• Raízen
• The Andersons
• TotalEnergies
• UPM
• Valero
• Verbio
• Wilmar International
• Zilor
   

Ethanol Biofuel Industry News

• In March 2025, ADM and Mitsubishi Corporation jointly announced the completion of a non-binding memorandum of understanding, thereby confirming the establishment of a strategic alliance to explore possible areas of future collaboration throughout the agriculture value chain, which will further bolster ADM's biofuel market portfolio internationally.
   
• In February 2025, Cargill executed the sale and purchase agreement for Cargill’s 50% interest in SJC Bionergia. This, when combined with the 50% interest already owned by the company, now means the company is fully owned. The company operates sugar cane and corn in order to create raw sugar, hydrated and anhydrous ethanol, corn oil and high protein content dried distillers’ grains (DDGs). This will in turn further strengthen the company’s position in the overall biofuel market.
   
• Lesaffre announced in 2024, the acquisition of Biorigin, which is a business unit of Zilor, a multinational corporation which specializes in yeast derivative products, for the purpose of augmenting the savory ingredient yeast derivatives supply. This acquisition will enhance both the production processes and services within the entire structure to the benefit of an international clientele.
   
• In December 2024, Blue Biofuels plans to open a new facility in the U.S. as innovations in cellulosic ethanol gain traction. These achievements foreshadow a broader industry shift toward greener feedstocks in 2025, thereby impacting the overall ethanol biofuel industry.
   

This ethanol biofuel market research report includes in-depth coverage of the industry with estimates & forecast in terms of volume (MToe) and revenue (USD Billion) from 2021 to 2034, for the following segments:

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Market, By Feedstock

• Coarse grain
• Sugar crop
• Vegetable oil
• Others

Market, By Application

• Transportation
• Aviation
• Others

The above information has been provided for the following regions and countries:

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • France
  • Italy
  • UK
  • Spain
• Asia Pacific
  • China
  • Japan
  • India
  • Australia
  • South Korea
• Middle East & Africa
  • Saudi Arabia
  • UAE
  • South Africa
• Latin America
  • Brazil
  • Argentina