Fuel-Ethanol Market, Covid-19 Outbreak, Raw Materials, Industry Overview, Segmentation, Regional Analysis, Key Players and Forecast to 2025

Market Synopsis

The global fuel-ethanol market was valued at USD 78.6 billion in 2018 and is expected to grow at a CAGR of 5.8% during the forecast period, 2019–2025. Crude oil and natural gases are commonly used sources for manufacturing fuels across the world. However, these sources are anticipated to get depleted within the next 40–50 years and they also damage the environment by emitting carbon monoxide, nitrogen oxides, particulate matter, and carbon dioxide upon combustion and cause global warming, acid rain, and urban smog among others. Thus, there observed a shift toward utilizing biofuels that are eco-friendly and reduce the carbon emissions rates.

Ethanol is one of the most promising alternative fuel to be used entirely or in a blended form with gasoline (2–85% (v/v)). Ethanol can be produced synthetically as well as biologically. Synthetic ethanol is readily synthesized from natural gas, coal, and ethylene, a by-product of petroleum. Synthetic ethanol from coal was half the cost of ethanol from the cane. Ethanol produced by fermentation of renewable food crops such as sugarcane, maize, wheat, sorghum, beet, and other starches is called bioethanol, and it is the eco-friendly alternative biofuel. The energy equivalent of bioethanol is lower than that of petroleum, but the combustion of bioethanol is cleaner because it contains oxygen that allows the engine for complete combustion of the gasoline when used in the blended form, resulting in fewer emissions and thereby reducing the occurrence of environmental pollution.

The market is mostly driven by rising environmental concerns and the need to reduce GHG emissions. Blending mandates by regulatory bodies are also positively influencing the market for fuel-ethanol. Furthermore, the introduction of second and third-generation bioethanol is also expected to provide growth impetus to the product market during the forecast period.

Market Segmentation

Global Fuel-Ethanol Market has been segmented into the source, raw material, application, and region.

Based on the source, the global fuel-ethanol market has been categorized as synthetic and natural.

By raw material, the global fuel-ethanol market has been classified as maize, wheat, industrial beets, sugarcane, cereals & starch, and others.

Based on application, the global fuel-ethanol market has been divided into a passenger car, light commercial vehicle, and heavy commercial vehicle.

Regional Analysis

The global fuel-ethanol market has been analyzed with respect to five regions, namely, Asia-Pacific, North America, Europe, Latin America, and the Middle East & Africa.

North America accounted for the largest market share of the global fuel-ethanol market in 2018 and is expected to show a similar trend during the forecast period. The established automotive industry and strict ethanol blending mandates in the US are propelling the market growth in the region. For instance, the US currently has 10% ethanol blending mandate for all vehicles; 15% ethanol blending mandate for cars and light pickup trucks with the model year of 2007 or later; and 85% blending mandate only for flexible-fuel cars, and for vehicles sold in Midwest. The current ethanol blending mandate in Canada is 5% and has put forth a target of 10% by the year 2020. Canada signed the Paris Agreement in 2016 and announced its futuristic objectives of minimizing emissions by nearly 30%, by the end of 2030. This regulatory scenario is considered to boost the use of low carbon intensity fuels and is ultimate to impact ethyl alcohol consumption in the future.

Latin America was the second-largest market for fuel-ethanol in 2018. Stable production of flexible fuel vehicles in Brazil and Argentina is likely to drive the demand for bioethanol fuel in the region. Also, the current ethanol blending mandate in Brazil is 18%. The current blending mandates in other Latin American countries are Jamaica 10%, Paraguay 25%, Panama 10%, Peru 7.8%, Colombia 10%, Mexico 5.8%, Chile 5%, and Costa Rica 7%.

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Key Players

Key players in the Global Fuel Ethanol Market include Advanced BioEnergy LLC (USA), The Andersons, Inc. (USA), Archer Daniels Midland Company (USA), BlueFire Renewables (USA), BP PLC (UK), Cargill Incorporated (USA), Flint Hills Resources (USA), Mascoma LLC (USA), Pacific Ethanol, Inc. (USA), and Panda Energy International Inc. (USA).

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