The global ethanol biofuel market is anticipated to record more than 7.1% CAGR from 2024 to 2032 as the world shifts towards renewable energy sources and seeks to reduce greenhouse gas emissions.

Government mandates and policies promoting the use of renewable fuels also play a significant role in stimulating market growth. Increasing awareness of the environmental benefits of ethanol biofuels, such as reduced emissions compared to traditional fossil fuels, is driving consumer demand.

Furthermore, advancements in ethanol production technologies and the development of more efficient feedstock sources add to its popularity. For instance, in September 2023, Lummus Technology announced the commercial availability of its ethanol to sustainable aviation fuel (SAF) process technology. This innovative technology offered operators a proven, large-scale solution to effectively mitigate greenhouse gas emissions within the aviation industry.

The global ethanol biofuel market is classified based on feedstock, application, and region.

The coarse grain feedstock segment is predicted to witness substantial growth through 2032. Corn, wheat, and barley are some of the primary feedstocks used in ethanol production. The abundance of these grains, coupled with advancements in agricultural practices and biotechnology, has led to increased efficiency and sustainability in ethanol production. Additionally, ongoing R&D efforts are focused on exploring alternative feedstock sources, expanding the potential of the market.

The aviation segment is expected to generate massive revenues by 2032 as ethanol biofuels are becoming a viable solution to reduce carbon emissions. With the aviation sector under increasing pressure to mitigate its environmental impact, airlines and aircraft manufacturers are exploring biofuels as a sustainable alternative to conventional jet fuels. Ethanol blends offer a promising avenue to reduce GHG emissions and achieve carbon neutrality in aviation operations.

Europe ethanol biofuel market size will expand significantly through 2032 owing to the stringent environmental regulations. European Union’s Renewable Energy Directive (RED) mandated the use of renewable fuels in the transportation sector. As a result, European countries are increasingly investing in ethanol production infrastructure and incentivizing the adoption of ethanol blends in gasoline. Furthermore, the European Green Deal and other sustainability initiatives are expected to further drive the demand for ethanol biofuels in the region, creating lucrative opportunities for market players.