Biodiesel Market Size, Share, Opportunities, And Trends By Blend Type (B5, B20, B100, Others), By Source (Animal Fat, Vegetable Oil), By Application Type (Transportation Fuel, Heating Oil, Power Generation, Others), And By Geography - Forecasts From 2025 To 2030

Description

Biodiesel Market Size:

The biodiesel market is projected to rise, achieving a 6.73% CAGR, to USD 63.808 billion in 2030 from USD 46.078 billion in 2025.

Biodiesel is a locally manufactured, biodegradable fuel made from leftover restaurant grease, animal fats, and vegetable oils. The Renewable Fuel Standard's requirements for advanced biofuels and biomass-based diesel are both met by biodiesel. Diesel fuel can be replaced with domestically generated, clean-burning biodiesel. The usage of biodiesel as a car fuel provides security and safeguards the environment. Owing to its clean-burning nature, biodiesel is expected to form a renewable alternative to current diesel fuel. It is made out of feedstock, animal fats, and recycled cooking oils. The market is anticipated to expand as more conventional fossil fuels are replaced with biodiesel in the transportation and energy sectors. Due to the numerous suppliers and dealers, the market is quite fragmented. This shows the biodiesel market is expected to rise due to many driving factors, which are responsible for the growth of the Biodiesel market.

Governments around the world are taking action to encourage biodiesel and are announcing biofuel-blending mandates, available subsidies, and tax incentives. This creates biodiesel in key areas of national energy transition plans. As biodiesel is a sustainable alternative to fossil fuels, it is currently being used in the transportation sector, the largest consumer of biodiesel, in commercial freight, passenger vehicles, marine transport, and aviation. Additionally, biodiesel is also being used in the applications of heating oil and generating power, allowing biodiesel to gain a market advantage.

Key players working in the market include ADM, Gevo, Chevron, Pacific Biodiesel, and Emami Agrotech Limited.

Biodiesel Market Trends

Transition to Waste-Based and Non-Edible Feedstocks

In the past, the process of making biodiesel relied mainly on oils that are fit for human consumption, such as soybean, palm, and rapeseed oils. Currently, the industry has changed to the use of non-edible oils such as jatropha, karanja, and neem, used cooking oil, tallow, and oil extracted from microalgae because of the price volatility of edible oils and the raised concerns about the food vs. fuel conflict. These changes are coming from the implementation of sustainability targets, cutting down of production costs, and the necessity of utilizing food and agriculture industry by-products, which are giving back to the biodiesel sector as an economic and ecological approach.

Biodiesel Market Dynamics

Market Drivers

• The Increasing Production of Feedstock
  The overwhelming portion of feedstock used to make biodiesel comes from vegetable oils such as rapeseed, soybean, and palm oils. As soybean oil is now the second-most popular feedstock utilized in the manufacturing of biodiesel after rapeseed oil, it is often used in the production of biodiesel in several European countries, whereas soybean oil is used in the United States and Argentina.

Improvements in algae-based biofuels and second-generation feedstocks are creating new opportunities by providing higher oil yields per acre and lessening the pressures of land use. Supply regions such as South America and the Asia Pacific, with their heavy agricultural productivity, are emerging as new suppliers to the global biodiesel economy, while developed economies are pursuing recycling programs and waste-to-energy initiatives. The increase in feedstock use allows a more stable and predictable supply chain that further stabilizes the cost of biodiesel products against conventional fossil fuels.

Biomass fuel consumption is projected to increase by 38 billion litres during the years 2023-2028, nearly a 30% increase compared to the previous five-year period. Overall biomass consumption increases by 23% for a total consumption of 200 billion litres by 2028, of which "renewable diesel" and "ethanol" will account for about two-thirds of the growth, and "biodiesel" and "biojet" at one-third.

Market Restraints

• Volatility of Feedstock Prices and Supply Limitations
  Biodiesel production has a great reliance on such materials as soybean oil, palm oil, rapeseed oil, animal fats, and used cooking oils. The prices of these products are extremely volatile, with various factors such as global agricultural output, weather conditions, trade restrictions, and competing demand from the food industry causing the fluctuations. In the case of poor yields of crops or the occurrence of geopolitical disputes, the producers of biodiesel will be faced with an increase in production costs and a decrease in their profitability, thus making it hard for them to do their long-term planning. Moreover, the food and fuel argument keeps being an issue since it is an ethical and economic problem that particularly affects developing countries that struggle with food security if edible oils are diverted for fuel use.

Market Opportunities

• Increased Demand for Ecologically Friendly Fuel
  The use of biodiesel as a substitute for fossil fuels in the automotive and power-generating industries, as well as growing public awareness of environmental concerns such as greenhouse gas emissions, are driving growth in the global biodiesel business. Fuels for transportation are used to power a variety of vehicles, including buses, trains, cars, and trucks. They are non-toxic and biodegradable, with a high energy density. They might also be moved quickly from one location to another. According to the Iowa Renewable Fuels Association, biodiesel reduces hydrocarbon emissions by up to 67% and particulate matter by 47%. Furthermore, as compared to petroleum fuel, the production of biodiesel reduces wastewater by 79% and hazardous waste by 96%.

Biodiesel Market Segmentation Analysis

By Application Type

Based on application type, the market is classified into transportation fuel, heating oil, power generation, and others.

Among the different applications, the transportation fuel segment is emerging as the fastest-growing and largest segment within the biodiesel market, spurred by the need to address greenhouse gas emissions, meet strict emissions mandates, and mitigate the reliance on fossil fuels within the global transportation sector. Biodiesel has become a prominent renewable alternative for road transportation applications because it can be mixed with petroleum diesel in many concentrations (B5, B10, B20, etc.) and can be used in existing diesel engines without significantly modifying the system. It is used extensively in freight trucks, public buses, agricultural machinery, and marine transportation since it faces technological hurdles for the application of electrification in terms of energy density and distance-based applications.

Biodiesel Market Regional Analysis

By region, the market is segmented into North America, South America, the Middle East and Africa, and Asia-Pacific.

• North America
  The biodiesel industry in North America is experiencing robust growth from favorable regulatory frameworks such as the U.S. Renewable Fuel Standard (RFS) and California's Low Carbon Fuel Standard (LCFS), which require biofuel blending in diesel fuel to reduce emissions. The region has ample feedstocks derived from soybeans and corn, making the U.S one of the world's largest biodiesel producers, and Canada is also increasing its blending mandates for establishing its net-zero targets.
• Europe
  On the biodiesel market, Europe is anticipated to have consistent growth. The growing emphasis on the usage of bio-based sources as an alternative to carbon-emitting ones is acting as a major driving factor for biodiesels. Also, major feedstock-producing European nations, such as Germany, are focusing on boosting the production of popular feedstock such as rapeseed, palm, soybean, and sunflower oil, which are the major sources for biodiesel production. By 2030, according to the European Union (EU), the region wants to increase the use of renewable energy in transportation by at least 14%, with advanced biofuels accounting for at least 3.5% of that total. The competitiveness of the bioethanol component has increased due to the rising price of gasoline, driving sales of both lower and higher mixes. This ensures that the biodiesel market is expected to rise with the huge demand for consumers and the government's adoption of more renewable energy sources in this region.

In May 2021, a new biofuel law was introduced by the German government. According to the new rule, oil firms that are subject to it must dramatically boost the usage of biodiesel, bioethanol, and biomethane in the transportation sector to cut carbon emissions.

• Asia-Pacific
  In the Asia Pacific region, the market is expected to be the fastest growing, where the growth will be sustained by high energy demand, changes in government policies to save fuel imports, and big blending orders in countries like Indonesia, India, and China. Indonesia has become the main driver of the global B30 and B40 biodiesel programs enabled by its palm oil sector, while India is making waste-to-diesel investments to back up its renewable energy roadmap. In general, the North and South American markets are well-established, Europe is still regulated strictly, MEA is at an early stage, but the Asia Pacific is predicted to have the highest growth path due to strong policy support, vast agricultural resources, and increasing domestic consumption.
• South America
  Biodiesel use is expanding rapidly in South America, with Brazil and Argentina at the forefront because of their relatively strong agricultural bases in soybean production, which provide inexpensive feedstock. Government blending programs, e.g., B12 in Brazil, have given biodiesel a stable domestic market while supporting exports to Europe and Asia.
• The Middle East and Africa
  The Middle East and Africa (MEA) region, still in its early stages, is gaining interest in biodiesel, particularly in South Africa and Gulf countries, hoping to diversify and limit fossil fuel usage. Moreover, MEA is in a region with considerable amounts of arable land for cultivating non-edible oil crops, such as jatropha, which could potentially be an important biodiesel feedstock in the future.

Biodiesel Market Competitive Landscape

Key Industry Players

The major contributors to the biodiesel sector are ADM, Gevo, Chevron, Pacific Biodiesel, Emami Agrotech Limited, Ag Processing Inc., Cargill Inc., Renewable Biofuels Inc., FutureFuel Corp., and Wilmar International Ltd. These firms are not only increasing their production abilities for biodiesel but also allocating substantial funds towards the development of advanced feedstock technologies and fortifying their distribution networks to be able to meet the demand, which is rising all over the world. Their objectives are primarily directed towards guaranteeing that the raw materials are obtained in an environmentally friendly manner, adhering to government regulations relating to blending, and forming collaborative agreements with the transport and energy industries to continue being competitive in the renewable fuels market.

List of Key Company Profiled

• ADM
• Gevo
• Chevron
• Pacific Biodiesel
• Emami Agrotech Limited
• Ag Processing, Inc.
• Cargill, Inc.
• Renewable Biofuels, Inc.
• FutureFuel Corp
• Wilmar International Ltd

Biodiesel Market Key Developments

• Product Launch: In May 2025, the NYK Group company Nippon Yuka Kogyo Co., Ltd. ("Nippon Yuka"), which specializes in chemical research and development as well as the production and distribution of chemical products, announced the upcoming launch of BioxiGuard, the first antioxidant in Japan created specifically for marine biodiesel fuel, or "biofuel."
• Expansion: In February 2025, at its location in Ludwigshafen, Germany, BASF is investing a mid-double-digit million-euro sum in a new alcoholates plant. Two crucial chemicals used in the manufacturing of biodiesel, as well as in pharmaceutical and agricultural applications, sodium methylate and potassium methylate, will be produced at the plant.
• Acquisition: In August 2024, the Rotterdam Sustainable Aviation Fuel (SAF) project by VARO Energy has advanced with the acquisition of a 50% stake by Gunvor Group. This collaboration broadens the project's focus to include the production of low-carbon fuels to meet the increasing demand for sustainable energy in aviation. The investment prioritizes strategic alignment on transportation decarbonization initiatives and supports the global shift to sustainable energy sources.

Segmentation

• By Blend type
  • B5
  • B20
  • B100
  • Others
• By Source
  • Animal Fat
  • Vegetable Oil
• By Application type
  • Transportation Fuel
  • Heating Oil
  • Power Generation
  • Others
• By Geography
  • North America
    • USA
    • Canada
    • Mexico
  • South America
    • Brazil
    • Argentina
    • Others
  • Europe
    • Germany
    • France
    • United Kingdom
    • Spain
    • Others
  • Middle East and Africa
    • Saudi Arabia
    • UAE
    • Others
  • Asia Pacific
    • China
    • India
    • Japan
    • South Korea
    • Indonesia
    • Thailand
    • Others

Table Of Contents

1. EXECUTIVE SUMMARY 

2. MARKET SNAPSHOT

2.1. Market Overview

2.2. Market Definition

2.3. Scope of the Study

2.4. Market Segmentation

3. BUSINESS LANDSCAPE 

3.1. Market Drivers

3.2. Market Restraints

3.3. Market Opportunities 

3.4. Porter’s Five Forces Analysis

3.5. Industry Value Chain Analysis

3.6. Policies and Regulations 

3.7. Strategic Recommendations 

4. TECHNOLOGICAL OUTLOOK

5. BIODIESAL MARKET BY BLEND TYPE

5.1. Introduction

5.2. B5

5.3. B20

5.4. B100

5.5. Others

6. BIODIESAL MARKET BY SOURCE

6.1. Introduction

6.2. Animal Fat

6.3. Vegetable Oil

7. BIODIESAL MARKET BY APPLICATION TYPE

7.1. Introduction

7.2. Transportation Fuel

7.3. Heating Oil

7.4. Power Generation

7.5. Others

8. BIODIESAL MARKET BY GEOGRAPHY

8.1. Introduction

8.2. North America

8.2.1. USA

8.2.2. Canada

8.2.3. Mexico

8.3. South America

8.3.1. Brazil

8.3.2. Argentina

8.3.3. Others

8.4. Europe

8.4.1. Germany

8.4.2. France

8.4.3. United Kingdom

8.4.4. Spain

8.4.5. Others

8.5. Middle East and Africa

8.5.1. Saudi Arabia

8.5.2. UAE

8.5.3. Others

8.6. Asia Pacific

8.6.1. China

8.6.2. India

8.6.3. Japan

8.6.4. South Korea

8.6.5. Indonesia

8.6.6. Thailand

8.6.7. Others

9. COMPETITIVE ENVIRONMENT AND ANALYSIS

9.1. Major Players and Strategy Analysis

9.2. Market Share Analysis

9.3. Mergers, Acquisitions, Agreements, and Collaborations

9.4. Competitive Dashboard

10. COMPANY PROFILES

10.1. ADM

10.2. Gevo

10.3. Chevron

10.4. Pacific Biodiesel

10.5. Emami Agrotech Limited

10.6. Ag Processing, Inc.

10.7. Cargill, Inc.

10.8. Renewable Biofuels, Inc.

10.9. FutureFuel Corp

10.10. Wilmar International Ltd

11. APPENDIX

11.1. Currency 

11.2. Assumptions

11.3. Base and Forecast Years Timeline

11.4. Key benefits for the stakeholders

11.5. Research Methodology 

11.6. Abbreviations 

LIST OF FIGURES

LIST OF TABLES

Companies Profiled

ADM

Gevo

Chevron

Pacific Biodiesel

Emami Agrotech Limited

Ag Processing, Inc.

Cargill, Inc.

Renewable Biofuels, Inc.

FutureFuel Corp

Wilmar International Ltd

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