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Bioethanol is Estimated to Witness High Growth Owing to Opportunity for Clean Fuel

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Rajkumar cmi
Bioethanol is Estimated to Witness High Growth Owing to Opportunity for Clean Fuel

Bioethanol is a green fuel produced from renewable feedstocks like sugarcane, corn, wheat and other starch and cellulosic materials through fermentation process. It is majorly used as automobile fuel blended with gasoline in different proportions. The increasing concerns over rising pollution levels and depleting fossil fuel reserves have enhanced the demand for clean and renewable fuels like bioethanol. The global bioethanol market is estimated to be valued at US$ 83.4 Bn in 2023 and is expected to exhibit a CAGR of 5.0% over the forecast period 2023-2030, as highlighted in a new report published by Coherent Market Insights.

Market Opportunity:

One key opportunity for the bioethanol market size is growing demand for clean fuel. Strict regulations enforced by governments of many countries to curb vehicular emissions are driving the replacement of fossil fuels with cleaner biofuels in the automotive industry. As bioethanol produces 50-70% less emissions than conventional vehicle fuels, its usage helps reduce air pollution. This advantage coupled with ongoing R&D to enhance the efficiency of bioethanol production from different renewable sources through advanced technologies will help meet the ever-increasing demand for eco-friendly fuels. The demand is further bolstered by incentivizing policies offering subsidies to fuel companies for blending bioethanol with gasoline. Thus, the need for clean automotive fuels worldwide presents a major growth opportunity for the bioethanol market over the forecast period.

Porter’s Analysis

Threat of new entrants: The bioethanol market requires high capital investment for ethanol production plants which provide barriers for new players. The presence of stringent regulations also make it difficult for new players to enter.

Bargaining power of buyers: The bargaining power of buyers is moderate as bioethanol can be substituted by other renewable fuels. However, the legislations supporting biofuels provide stability in demand.

Bargaining power of suppliers: Biomass and grains are key raw materials for bioethanol production. Stable availability of raw materials at competitive prices influences the profit margins of producers.

Threat of new substitutes: The development of other advanced biofuels poses a threat, however bioethanol being a widely accepted biofuel with existing infrastructure limits significant impact of substitutes in the forecast period.

Competitive rivalry: The market is consolidated with major players having widespread production facilities. Intense competition exists based on product quality, reliability of supply and pricing.

SWOT Analysis

Strength: Bioethanol is a renewable and cleaner alternative to gasoline widely accepted in the transportation sector. Supportive policies and initiatives boost the demand.

Weakness: Agro-climatic conditions and availability of feedstock influence the supply and production levels. High production costs compared to fossil fuels restrict market penetration.

Opportunity: Developing countries with favorable farming conditions and growing vehicle fleet present new markets. Technological advancements may lower production costs enhancing competitiveness.

Threats: Fluctuations in grain prices and crude oil prices impact the demand-supply dynamics. Slow pace of infrastructure development for distribution and blending hampers market growth.

Key Takeaways

The global bioethanol market is expected to witness high growth supported by supportive policies and initiatives promoting the adoption of cleaner fuels.

Regional analysis: The Asia Pacific region accounts for over 45% of the global bioethanol production led by China, India and Southeast Asian countries. China is the largest producer of bioethanol globally with majority consumed for fuel blending. Countries like India and Indonesia are emerging as high growth markets on account of policy reforms and infrastructure investments. The proliferation of flex-fuel vehicles compatible with high ethanol blends will drive the market.

Key players related content: Key players operating in the bioethanol market include Adeka Corporation, Baerlocher GmbH, Chemson Polymer Additive AG, Galata Chemicals, Jiangsu Uniwel Chemistry Co. Ltd, KD Chem Co. Ltd, Pau Tai Industrial Corporation, PMC Group Inc., PT TIMAH Tbk, Reagens SpA, Shital Industries Pvt Ltd, SONGWON, Sun Ace Kakoh (Pte) Ltd, Valtris Specialty Chemicals, and Vikas Ecotech Ltd. Major players are investing in capacity expansions to cater

Get more insights on this topic: https://www.trendingwebwire.com/bioethanol-market-size-and-opportunity-analysis/

 

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