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Advanced Biofuels Market Size and Forecast, by Fuel (Biodiesel, Bio Butanol, Biogas, Cellulosic Ethanol, Biohydrogen); Feedstock (Lignocellulose, Energy Crops, Alage, Municipal Solid Waste); Processing Technology (Biochemical, Thermochemical); Application (Electricity, Heating, Cooking) - Growth Trends, Key Players, Regional Analysis 2026-2035

  • Report ID: 6008
  • Published Date: Sep 17, 2025
  • Report Format: PDF, PPT

Advanced Biofuels Market Outlook:

Advanced Biofuels Market size was valued at USD 21.47 billion in 2025 and is likely to cross USD 51.77 billion by 2035, registering more than 9.2% CAGR during the forecast period i.e., between 2026-2035. In the year 2026, the industry size of advanced biofuels is assessed at USD 23.25 billion.

Advanced Biofuels Market Size
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The rapid increase in energy utilization across the world is fueling the market growth over the projected timeframe. According to a recent report, global energy consumption growth was comparatively reduced in 2022 (+2.1%) but it remained higher than its average growth rate from 2010 to 2019 (+1.4%/year).

Biofuels are mainly produced from biological sources which include vegetable oil, and crop residues such as wheat, barley, and whey. The raw material used for production is easily accessible in local areas at affordable rates. Beside this, animal fat acts as raw material for biodiesel production as the cost is comparatively lower than vegetable oils. Easy and economical availability of raw materials for biofuel production is driving the market growth.

Key Advanced Biofuels Market Insights Summary:

  • Regional Highlights:

    • North America advanced biofuels market will secure over 34% share by 2035, fueled by supportive biofuel regulations and demand for cleaner fuels.
    • Asia Pacific market will achieve a 25% share by 2035, attributed to rising biofuel production, notably in Indonesia, and use of new technologies.

  • Segment Insights:

    • The energy crops segment in the advanced biofuels market is projected to hold a 34% share by 2035, attributed to the availability of crop residue having the potential to produce energy.
    • Biodiesel segment in the advanced biofuels market is expected to achieve 28% growth by the forecast year 2035, driven by the growing demand for clean and renewable alternatives.

  • Key Growth Trends:

    • Alternative fuel source with reduced carbon emission
    • Favorable government regulations for increasing biofuel production

  • Major Challenges:

    • Lack of knowledge about biofuels 

  • Key Players: Renewable Energy Group, Gevo Inc., BP p.l.c, Solix Biofuels, Neste, Sinopec, Imperium Renewables, Inc., Honeywell International Inc., Clariant AG, Bangchak Corporation Public Company Limited.

Global Advanced Biofuels Market Forecast and Regional Outlook:

  • Market Size & Growth Projections:

    • 2025 Market Size: USD 21.47 billion
    • 2026 Market Size: USD 23.25 billion
    • Projected Market Size: USD 51.77 billion by 2035
    • Growth Forecasts: 9.2% CAGR (2026-2035)

  • Key Regional Dynamics:

    • Largest Region: North America (34% Share by 2035)
    • Fastest Growing Region: Asia Pacific
    • Dominating Countries: United States, Brazil, China, Germany, United Kingdom
    • Emerging Countries: China, India, Japan, South Korea, Singapore

    • Last updated on : 17 September, 2025

Growth Drivers

  • Alternative fuel source with reduced carbon emission - Biofuels act as an alternative fuel to fossil fuels in the automotive sector. They reduce greenhouse gas emissions give energy security and support regional development. They are also known as second-generation biofuels and a significant step towards sustainable development, which is leading to the advanced biofuels market. The raw material used in fuel production is derived from non-edible biomass feedstocks. As per the recent report, the annual consumption of biodiesel in 2021 across the globe was around 13,776 million gallons whereas the total amount of biodiesel produced was 13,966 million gallons in the same year. Furthermore, the demand for biofuels is set to expand with an approximate value of 38 billion liters over 2023-2028 with around a 30% increase from the last five-year period.

  • Favorable government regulations for increasing biofuel production - The government has introduced various policies which are majorly focusing on sustainable development, by increasing the use of sustainable power sources, which can assist in the market widening. People shifted their focus to renewable energy sources by using environment-friendly alternatives for fuel production and electricity generation. Air quality monitoring system have been installed in different places of urban cities by the government as the rate of carbon emission is very high in such places.

Challenges

  • Lack of knowledge about biofuels - People are unaware of the benefits of utilizing second-generation biofuels. Production of advanced biofuels and the availability of feedstock can meet the growing demand for energy across the world. Moreover, the rate of production and equipment is quite expensive which can hinder the market growth of biofuels.

  • People face difficulties with technological maturity and scalability while biofuel conversion technologies are still in the early phase of research.

Advanced Biofuels Market Size and Forecast:

Report Attribute Details

Base Year

2025

Forecast Period

2026-2035

CAGR

9.2%

Base Year Market Size (2025)

USD 21.47 billion

Forecast Year Market Size (2035)

USD 51.77 billion

Regional Scope

  • North America (U.S. and Canada)
  • Asia Pacific (Japan, China, India, Indonesia, Malaysia, Australia, South Korea, Rest of Asia Pacific)
  • Europe (UK, Germany, France, Italy, Spain, Russia, NORDIC, Rest of Europe)
  • Latin America (Mexico, Argentina, Brazil, Rest of Latin America)
  • Middle East and Africa (Israel, GCC, North Africa, South Africa, Rest of the Middle East and Africa)
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Advanced Biofuels Market Segmentation:

Fuel Segment Analysis

The biodiesel segment in the advanced biofuels market is estimated to gain the largest share of about 28% in the year 2035. The segment growth can be attributed to the growing demand for clean and renewable alternatives to petroleum diesel. Using biodiesel as fuel in vehicles can result in improved environmental conditions and public health. In addition, it also offers safety benefits and contributes to a resilient transportation system. According to a recent report, Biodiesel and mixtures were the 129th most traded product in 2022 across the world, with a total trade of USD 36.6 billion. In the years 2021 and 2022, the exports of Biodiesel and mixtures grew by around 42.9%, from USD 25.6 billion to USD 36.6 billion. Biodiesel and mixtures trade represents 0.15% of total world trade.

Feedstock Segment Analysis

The energy crops segment in the advanced biofuels market is predicted to gain a significant share of about 34% in the year 2035. The segment growth can be attributed to the availability of crop residue having the potential to produce energy. Energy crops are likely to grow as dependable and sustainable feedstock which is available easily in local areas and a source for the production of advanced biofuels. Ongoing improvements in agricultural yield and sustainable farming techniques are the reason behind the growth of the advanced biofuel market.

Our in-depth analysis of the global market includes the following segments:

 

 

     Fuel
  • Biodiesel
  • Biobutanol
  • Biogas
  • Cellulosic Ethanol
  • Biohydrogen

 

 

     Feedstock
  • Lignocellulose
  • Energy Crops
  • Alage
  • Municipal Solid Waste

 

     Processing Technology
  • Biochemical
  • Thermochemical

 

     Application
  • Electricity
  • Cooking
  • Heating
Vishnu Nair
Vishnu Nair
Head - Global Business Development

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Advanced Biofuels Market Regional Analysis:

North American Market Insights

The advanced biofuels market in North America is predicted to hold the largest with a share of about 34% by the end of 2035. The market growth in the region is also expected on account of supportive government regulation to increase biofuel production and the growing demand for cleaner-burning transportation fuels, mainly in the United States.

Additionally, owing to the presence of big companies with innovative ideas and the latest technology for the production of clean and green fuel, it is projected to have a significant impact on the market size. As per a recent report, the United States was the leading producer of biofuel in 2022 with a total production of around 1,627 petajoules. Biofuel produced in the United States accounts for nearly 38% of global biofuel production in 2022. The country has produced the largest amount of biodiesel with annual production of 1.64 billion gallons. Global biofuel production has gradually increased from 180 thousand barrels of oil equivalent per day in 2000 to 1.9 million barrels of oil equivalent per day in 2022. Moreover, the largest consumer of biofuels in the U.S. is the national army, adding to the market revenue.

APAC Market Insights

The Asia Pacific market is estimated to be the second largest, registering a share of about 25% by the end of 2035. The advanced biofuels market expansion can be attributed majorly to the growing awareness of the benefits of using advanced biofuels in emerging economies. As per the recent report, Indonesia was ranked third in biofuel production across the world in 2022 with a total production of 390 petajoules. Apart from this, Indonesia is the largest producer of biodiesel and renewable diesel in the world. In 2022, the country has reported production of around 13.65 billion liters of biofuel. In addition, factories are producing cellulosic ethanol by using agricultural waste as raw material for biofuel production in the region. Businesses have started investing in the latest technological equipment to match the growing market demand for converting trash into fuel and producing biofuels by using algae as feedstock.

Advanced Biofuels Market Share
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Advanced Biofuels Market Players:

    • Renewable Energy Group
      • Company Overview
      • Business Strategy
      • Key Product Offerings
      • Financial Performance
      • Key Performance Indicators
      • Risk Analysis
      • Recent Development
      • Regional Presence
      • SWOT Analysis
    • Gevo Inc.
    • BP p.l.c
    • Solix Biofuels
    • Neste
    • Sinopec
    • Imperium Renewables, Inc.
    • Honeywell International Inc.
    • Clariant AG
    • Bangchak Corporation Public Company Limited

Recent Developments

  • Gevo, Inc. has finalized and executed a notice of grant and agreement award with the U.S. Department of Agriculture (USDA). They have made a partnership for a climate-smart commodities grant of up to USD 30 million for Gevo’s climate-smart farm-to-flight program. The focus of this program is to track and quantify the impact of carbon-intensity (CI) of climate-smart practices and also create market incentives for low-CI corn to help speed up of production of sustainable aviation fuel (SAF) and low-CI ethanol.
  • Neste has started the sustainable aviation fuel (SAF) supply to Emirates Airlines at Amsterdam Airport Schiphol. This will expand the partnership between the two companies as was announced in October last year. About 6,000 tons (2 million gallons) of SAF will be supplied into the fueling system at Amsterdam Airport Schiphol in the year 2024.
  • Report ID: 6008
  • Published Date: Sep 17, 2025
  • Report Format: PDF, PPT
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Frequently Asked Questions (FAQ)

In the year 2026, the industry size of advanced biofuels is assessed at USD 23.25 billion.

The global advanced biofuels market size was valued at over USD 21.47 billion in 2025 and is expected to register a CAGR of more than 9.2%, exceeding USD 51.77 billion revenue by 2035.

North America advanced biofuels market will secure over 34% share by 2035, fueled by supportive biofuel regulations and demand for cleaner fuels.

Key players in the market include Renewable Energy Group, Gevo Inc., BP p.l.c, Solix Biofuels, Neste, Sinopec, Imperium Renewables, Inc., Honeywell International Inc., Clariant AG, Bangchak Corporation Public Company Limited.

Advanced Biofuels Market Report Scope

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