How big is the Biofuel Market | Global Size & Forecast 2025

Q: How big is the biofuel market?

The biofuel market size was estimated at USD 143 billion in 2024 and is projected to reach USD 248 billion by 2031.

Q: What trends are influencing the biofuel industry?

Key trends include adoption of SAF, second-gen biofuels, AI-enabled feedstock tracking, and green partnerships in aviation and transport sectors.

Q: What are the primary drivers of biofuel market growth?

Drivers include climate change mandates, energy diversification, national biofuel targets, and rising demand for low-emission fuels.

Q: Which regions are leading in biofuel production and adoption?

North America, Europe, and Brazil lead the market, while Asia-Pacific is growing fast with investments in bio-refineries and rural energy programs.

Q: How does 6W market outlook report help businesses in making decisions?

6W monitors the market across 60+ countries Globally, publishing an annual market outlook report that analyses trends, key drivers, Size, Volume, Revenue, opportunities, and market segments. This report offers comprehensive insights, helping businesses understand market dynamics and make informed decisions.

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Code: MTA4798

Publication Date: Jul 2025

What is the size of the Biofuel Market?

According to 6Wresearch internal database and industry insights, the Biofuel Market was estimated at USD 143 billion in 2024 and is projected to reach USD 248 billion by 2031, growing at a substantial CAGR of 8.4 % during the forecast period 2025–2031.

The growth of market is mainly occurring due to global efforts to reduce carbon emissions, increasing adoption of renewable energy sources, and strong policy support for alternative fuels.

Key Growth Factors of the Biofuel Market

Rising global focus on energy transition and decarbonization goals
Favourable government policies, subsidies, and blending mandates
Increasing use of bioethanol and biodiesel in transport and aviation
Abundant availability of biomass, waste oils, and algae feedstocks
Corporate shift toward low-carbon fuel alternatives in logistics and shipping

Biofuel Market Trends

The market is growing with the trends such as shift towards second- and third-generation biofuels, which use non-food biomass such as agricultural residues, algae, and municipal waste. Sustainable aviation fuel (SAF) is gaining popularity, particularly in the U.S. and Europe. Demand is increasing for advanced biodiesel and bioethanol technologies that improve energy efficiency and reduce production costs. The investment is rising in bio-refineries, while global energy players are entering strategic partnerships for biofuel infrastructure. The integration of AI and blockchain in feedstock tracking and carbon accounting is a rising trend.

Emerging Developments in the Biofuel Market

Market is seeing few developments in cellulosic ethanol and algae-derived biodiesel are expanding potential of biofuel in hard-to-abate sectors. The market is observing the development of drop-in biofuels compatible with current engines and fuel systems. Hybrid biofuel-electric systems are being explored in marine and aviation sectors. Numbers of countries, including India, Brazil, and the U.S., are boosting biofuel blending mandates, while Europe is leading in green hydrogen integration with biofuels. Startups and energy giants are collaborating to scale waste-to-fuel technologies, particularly for urban transportation and logistics.