The Global Fuel Ethanol Market size was valued at USD 94.47 billion in 2023 and is projected to reach USD 132.50 billion by 2029 from USD 99.95 billion in 2024 and growing at a CAGR of 5.80% during the forecast period 2024 to 2029.
Ethanol, often termed ethyl alcohol, is a type of alcohol generated either directly or indirectly from corn, sugarcane, and grain. It's also the primary alcohol found in most alcoholic beverages made from a mash of grains (gin, vodka, and whiskey) or sugarcane juice (rums). It's also a fuel type routinely mixed with gasoline at the gas station to oxygenate the fuel. Ethanol fuel can also be used to power cars on its own. Ethanol is more ubiquitous than you might believe in our daily lives. After all, Ethanol is included in every alcoholic beverage you can consume. Ethyl alcohol, pure alcohol, and grain alcohol are some of the names given to them. It is considered an alternative fuel source that has grown in popularity for a variety of reasons. Ethanol fuel is most commonly used by combining it with gasoline. As a result, a mix is created that emits fewer pollutants into the environment and is regarded as cleaner by nature. It also improves the car's performance by raising the fuel's octane level. Overall, individuals, governments, and automobile manufacturers accept it because of the numerous benefits it delivers.
Ethanol fuel is the most affordable energy option because it can be produced in almost every country. Corn, sugar cane, and grain are grown in practically every country, making production cost-effective compared to fossil fuels. In addition, fossil fuels can be detrimental to the economies of most countries, particularly emerging countries that lack the resources to explore them. Therefore, it makes sense for these developing economies to focus on manufacturing ethanol fuel to limit their dependence on fossil fuels and save money. The fact that Ethanol does not pollute the environment is one of its most compelling advantages over other fuel sources. For example, when Ethanol is used to power automobiles, the amount of contaminants released into the environment is considerably reduced. In addition, Ethanol is frequently transformed into fuel by combining it with gasoline. Moreover, it helps in reducing global warming.
Because Ethanol is a biofuel, it is readily available to almost everyone. Energy obtained from plants such as sugarcane, cereals, and corn is referred to as biofuel. Sugarcane may be grown in any tropical climate. Every country grows grain and corn. Corn is an important meal in almost every African country. More sugarcane, corn, and grain plantations will be needed as the usage of ethanol fuel grows. It further means that there will be more ethanol fuel processing factories, which means more job prospects. Ethanol can also be used to make alcoholic beverages, resulting in new job prospects in the hotel industry.
Because ethanol fuel is mainly made from agricultural products, people will be pushed into the underutilized agricultural sector, which will boost a country's economy. This act will ensure the availability of ethanol fuel for many years. In addition, the demand for more corn and grains has sparked a boom in the farming industry, which further increases the global fuel ethanol market demand in the upcoming years.
Moreover, ethanol fuel has been linked to engine burns, and corrosion is one of its drawbacks. However, researchers are attempting to convert it to hydrogen to make it more productive and elevate it as a formidable alternative fuel source.
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REPORT METRIC |
DETAILS |
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Market Size Available |
2023 to 2029 |
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Base Year |
2023 |
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Forecast Period |
2024 to 2029 |
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CAGR |
5.80% |
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Segments Covered |
By Product, Application, and Region. |
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Various Analyses Covered |
Global, Regional & Country Level Analysis, Segment-Level Analysis, DROC, PESTLE Analysis, Porter’s Five Forces Analysis, Competitive Landscape, Analyst Overview of Investment Opportunities |
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Regions Covered |
North America, Europe, APAC, Latin America, Middle East & Africa |
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Market Leaders Profiled |
Valero Energy Corporation, Raizen S.A., Green Plains Renewable, Inc., E.I. du Pont de Nemours and Company, Wilmar International Ltd., Cargill, Inc., BlueFire Renewables, Inc., Pacific Ethanol, Inc., Flint Hills Resources L.P., Jilin Fuel Ethanol Co., Ltd, and Others. |
Based on the product, starch-based is anticipated to dominate the global fuel ethanol market in terms of volume in the next six years. Furthermore, by 2025, it is expected to increase at a CAGR of 5.8 percent. Corn, wheat, barley, and cassava are used in the production of starch-based products. These goods have a high starch content and can help to reduce greenhouse gas (GHG) emissions significantly.
On the other hand, corn-based is expected to have the highest CAGR in the global fuel ethanol market. The United States Department of Energy study shows that corn-based ethyl alcohol has reduced airborne emissions by approximately 20%. However, due to its high starch content and capacity to create ethyl alcohol with a high octane rating and good anti-knocking qualities, cassava as a suitable feedstock is likely to acquire relevance in developing economies, including China and Thailand the following years.
Moreover, the cellulosic segment is predicted to grow significantly in the global fuel ethanol market during the forecast period. Because it is made from biowastes such as wood chips, maize stover, wheatgrass, and fruit peels, this segment is expected to develop the fastest during the projected period.
The conventional fuel vehicle segment was the industry's most significant application in 2023. Gasoline with low ethanol mixes, such as E10 and E15, can be used in conventional automobiles. E10 is a composition of 10% ethanol and 90% gasoline, while E15 is a mixture of 10.5 to 15% ethanol. In addition, rising fuel economy regulations for conventional vehicles in nations such as the United States, China, India, and Brazil are likely to raise product use in the future.
The flexible-fuel vehicles (FFVs) segment is expected to increase quickly during the forecast period. These vehicles are primarily powered by internal combustion engines that can run on gasoline and ethanol-gasoline blends higher than E10, such as E85, often known as flex-fuel. E85 is a composition of Ethanol and gasoline that contains between 51 and 83 percent Ethanol.
North America held the most significant part of the entire market volume, accounting for 59.4 percent owing to the presence of a well-established and developed automotive industry and strong limits on particle emissions; this region is projected to be one of the fastest-increasing customers of the product. This scenario is likely to play out in the United States.
Central and South America was the industry's second-largest customer, followed by Europe. In the coming years, the intense production of flexible fuel vehicles in Brazil and Argentina will likely stimulate demand for sugar-based ethanol fuel. Razen S.A., GranBio-API, and B.P. However, biofuels are only a few of the market's major participants.
During 2024-2029, Asia Pacific is expected to grow at the fastest rate. Over the next six years, an increase in foreign investment, combined with government policies promoting sustainable development, is likely to stimulate the usage of biofuels. This scenario is expected to play out in China, India, and certain Southeast Asian countries.
Companies playing a prominent role in the global fuel ethanol market include Valero Energy Corporation, Raizen S.A., Green Plains Renewable, Inc., E.I. du Pont de Nemours and Company, Wilmar International Ltd., Cargill, Inc., BlueFire Renewables, Inc., Pacific Ethanol, Inc., Flint Hills Resources L.P., Jilin Fuel Ethanol Co., Ltd, and Others.
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