Biorefinery Market Size, Share, Growth & Industry Analysis By Feedstock (Starch & Sugar Crops, Energy Crops, Organic & Agricultural Residues, and Others), By Process (Thermochemical, Biochemical, Chemical, and Others), and Regional Analysis, 2024-2031

Market Definition

The market involves the sustainable conversion of biomass into biofuels, biochemical, biomaterials, and bioenergy. Utilizing feedstocks such as agricultural residues, forestry waste, and algae, biorefineries produce value-added products as alternatives to fossil-based resources.

Growing environmental concerns, government policies, and advancements in biotechnology are leading to market expansion and innovation. Biorefineries are expected to play a crucial role in the global shift to a circular and low-carbon economy as the demand for sustainable solutions increases.

Biorefinery Market Overview   

The global biorefinery market size was valued at USD 158.55 billion in 2023 and is projected to grow from USD 171.28 billion in 2024 to USD 315.47 billion by 2031, exhibiting a CAGR of 9.12% during the forecast period.

The market is growing rapidly, due to the increasing demand for renewable energy, government policies supporting bio-based alternatives, and advancements in biotechnology. Rising concerns over carbon emissions and the depletion of fossil fuel resources have accelerated the adoption of biofuels, biochemicals, and biomaterials.   

Major companies operating in the biorefinery industry are Neste, Novozymes A/S, Chevron, POET, LLC, Drax Global, Cosan, Enviva Inc., Verbio SE, LanzaTech, Aemetis, Inc., Praj Industries, Oberon Fuels, Inc., ADM, Cargill, Borregaard AS, and Wilmar International Ltd.

Technological innovations in biomass conversion processes, expanding investments in sustainable infrastructure, and the shift to a circular economy are further driving the market. The growing use of agricultural and forestry waste as feedstock, along with supportive regulations and incentives, is also contributing to the steady growth of the market.  

• In March 2024, Neste introduced 'Neste Impact', a solution enabling businesses to reduce aviation emissions by purchasing Neste MY Sustainable Aviation Fuel (SAF). This approach allows companies to achieve measurable emission reductions, with SAF offering up to an 80% decrease in Greenhouse Gas (GHG) emissions over its lifecycle compared to traditional jet fuel. The program aligns with the Science Based Targets initiative (SBTi) and provides third-party verified reports for credible sustainability reporting.

Key Highlights

1. The globalbiorefinery market size was valued at USD 158.55 billion in 2023.
2. The market is projected to grow at a CAGR of 9.12% from 2024 to 2031.
3. North America held a market share of 36.52% in 2023, with a valuation of USD 57.90 billion.
4. The biochemical segment garnered USD 61.23 billion in revenue in 2023.
5. The starch & sugar crops segment is expected to reach USD 115.64 billion by 2031.
6. The market in Asia Pacific is anticipated to grow at a CAGR of 9.84% during the forecast period.

Market Driver

"Exhaustion of non-renewable energy sources"

The depletion of fossil fuel resources is a significant driver of the global bio-refinery market. Traditional energy sources like oil, coal, and natural gas are becoming scarcer, which is boosting the need to find alternative and sustainable energy solutions. Biorefineries address this challenge by converting biomass into renewable fuels and chemicals, thereby reducing dependence on finite fossil fuels.

• In May 2024, the World Resources Institute (WRI) highlighted concerns regarding the U.S. SAF policies. SAF is crucial for net-zero emissions goals in aviation; however, fuels like corn ethanol could increase emissions. Critics argue that these fuels are not truly sustainable, compete with food production, and cause environmental harm. The debate centers on whether SAF policies truly reduce emissions or just provide tax credits to questionable biofuels.

This transition mitigates the environmental impacts associated with fossil fuel extraction and consumption which enhances energy security by diversifying the energy mix. Consequently, investments in bio refinery technologies are gaining momentum, supported by favorable government policies and incentives aimed at promoting renewable energy sources.  

Market Challenge

"High and Variable Feedstock Costs"

Managing high and variable feedstock costs is a significant challenge in the biorefinery market, affecting the economic feasibility of bio-based product production. Factors such as moisture content, supply chain dynamics, and quality variability contribute to these costs.

Elevated moisture levels in biomass can reduce transportation efficiency and increase delivery expenses to biorefineries. Variations in biomass availability, due to seasonal changes, agricultural practices, and competition for feedstock, can lead to price volatility. Differences in biomass quality, such as varying levels of inert matter and particle size, can cause processing inefficiencies and increased operational costs.

Strategies that help mitigate high & variable feedstock costs in biorefineries include diversifying biomass sources, implementing preprocessing techniques, employing integrated landscape management, utilizing advanced process control systems, and optimizing logistics.

These approaches enhance supply chain resilience, standardize feedstock quality, stabilize availability, maintain consistent production efficiency, and minimize associated costs, thereby improving the economic production feasibility of bio-based products.

Market Trend

"Integration with Traditional Industries"

Integrating biorefinery processes into traditional industries, such as oil refineries and pulp mills, can enhance sustainability and operational efficiency. This integration facilitates the transformation of conventional refineries into biofuel manufacturing hubs, utilizing domestic feedstocks and thereby reducing reliance on fossil fuels.

For instance, the pulp & paper industry has the potential to evolve into biorefineries, producing sustainable materials and renewable energy, thereby contributing to a more sustainable and circular economy.  

• On July 26, 2024, Petronas, Enilive, and Euglena reached a final investment decision to construct a biorefinery in Pengerang, Malaysia. This joint venture aims to process approximately 650,000 tons of raw materials annually, producing sustainable aviation fuel, hydrogenated vegetable oil, and bio-naphtha. The facility is expected to be operational by the second half of 2028.

In the pulp & paper industry, integrating biorefinery processes can enhance the long-term viability of mills by producing value-added products from byproducts like lignin and tall oil fatty acids.

Integrating biorefinery processes into traditional industries represents a strategic move to a more sustainable and circular economy, aligning with global efforts to reduce carbon emissions and promote renewable resource utilization.  

Biorefinery Market Report Snapshot 

Market Segmentation

• By Feedstock (Starch & Sugar Crops, Energy Crops, Organic & Agricultural Residues, Others): The starch & sugar crops segment earned USD 61.12 billion in 2023, driven by the increasing demand for biofuels and renewable energy sources.  
• By Process (Thermochemical, Biochemical, Chemical, Others): The biochemical segment held 38.62% share of the market in 2023, driven by the increasing adoption of fermentation processes for biofuel and production of bio products.

Biorefinery Market Regional Analysis 

Based on region, the market has been classified into North America, Europe, Asia Pacific, Middle East & Africa, and Latin America.

North America accounted for a significant biorefinery market share of around 36.52% in 2023, valued at USD 57.90 billion. This dominance is attributed to the region's substantial investments in sustainable energy technologies, favorable government policies promoting renewable energy, and the presence of advanced infrastructure supporting biorefinery operations.

The increasing demand for biofuels and renewable energy sources in North America has significantly contributed to the market growth.

• In December 2024, Chevron announced the completion of a retrofit at its Pasadena, Texas refinery, enhancing its capacity to process lighter crudes by nearly 15%, reaching 125,000 barrels per day. This upgrade aims to increase product flexibility and support the processing of more equity crude from the Permian Basin, thereby bolstering the American energy value chain.

These developments underscore North America's commitment to advancing sustainable energy solutions and reinforcing its position in the global market. The region's focus on renewable energy and sustainable practices continues to drive innovation and growth in the market.

The biorefinery industry in Asia Pacific is poised to grow at a CAGR of 9.84% through the projection period, driven by increasing government initiatives and policies promoting renewable energy & sustainable practices.

The growing demand for biofuels as an alternative to fossil fuels, along with the rising focus on waste management and the conversion of agricultural residues into value-added products, are key factors boosting the market.

• For instance, in December 2023, according to the Press Information Bureau, the Indian government is actively promoting bio-CNG production through a variety of measures. These include financial assistance for bio-CNG plant construction, customs duty concessions on machinery imports, and additional support for plants utilizing municipal solid waste. Furthermore, bio-CNG projects are eligible for priority sector lending, and the Central Pollution Control Board (CPCB) has categorized them under the 'White Category'. The government is also investing in Research and Development (R&D) to broaden the applications of bio-CNG.

These initiatives underscore the region's commitment to advancing sustainable energy solutions and reinforcing its position in the global biorefinery market. The strategic focus on renewable energy and waste-to-energy technologies is expected to drive innovation and economic growth in the market.

Regulatory Frameworks

• The Renewable Fuel Standard (RFS) program, established under the Energy Policy Act of 2005 and expanded in 2007, mandates a minimum volume of renewable fuels in transportation fuels. This program aims to reduce GHG emissions, bolster the renewable fuels sector, and decrease reliance on imported oil.
• The Renewable Energy Directive (RED II) is an EU-wide policy framework promoting renewable energy. It sets a binding target of at least 32% renewable energy consumption by 2030, covering electricity, heating & cooling, and transport. RED II aims to accelerate the transition to cleaner energy sources and contribute to achieving the EU's climate and energy goals.
• The Mission Innovation roadmap for Integrated Biorefineries outlines pathways for developing and deploying advanced biorefineries.  It emphasizes the need for integrated approaches that utilize diverse feedstocks, produce a range of bio-based products (fuels, chemicals, materials), and minimize waste.
• The Renewable Fuel Standard (RFS) program, established by Congress under the Energy Policy Act of 2005 and expanded by the Energy Independence and Security Act of 2007, mandates minimum volumes of renewable fuels to be blended into transportation fuels. Administered by the EPA, the RFS aims to reduce GHG emissions, increase energy security, and promote the growth of the renewable fuels industry.

Competitive Landscape

Organizations must prioritize a strategic approach encompassing innovation, sustainability, and market responsiveness to achieve a competitive advantage in the continuously evolving bio-refinery market. 

This necessitates the development of adaptable biorefinery platforms capable of processing a diverse range of feedstocks and efficiently producing a variety of bio-based products at scale. 

The integration of advanced technologies, cultivation of robust partnerships, and adoption of sustainable practices are of paramount importance. A comprehensive understanding of evolving market trends, strategic acquisition of intellectual property, and effective communication with stakeholders further enhance competitive positioning.

• In January 2025, UPM was listed as the only forest & paper industry company in the Dow Jones World and European Sustainability Indices (DJSI). This recognition reflects UPM’s commitment to sustainability, with a focus on renewable resources, reducing environmental impacts, and enhancing societal value. Additionally, UPM issued a EUR 600 million Green Bond in 2024 to further its sustainability goals.

List of Key Companies in Biorefinery Market:

• Neste
• Novozymes A/S
• Chevron
• POET, LLC
• Drax Global
• Cosan
• Enviva Inc.
• Verbio SE
• LanzaTech
• Aemetis, Inc.
• Praj Industries
• Oberon Fuels, Inc.
• ADM
• Cargill
• Borregaard AS
• Wilmar International Ltd

Recent Developments

• In January 2025,Verdagy and Petron Scientech signed an agreement to deploy Verdagy’s green hydrogen electrolyzers at a biorefinery. The project aims to produce SAF, e-methanol, and bio-chemicals in the U.S. This partnership supports the production of low-carbon biofuels, advancing both companies’ efforts to accelerate the energy transition.
• In December 2024, Neste and Air New Zealand announced a deal for 23,000 tons of SAF, marking the airline's largest SAF purchase. The fuel will be used at Los Angeles and San Francisco airports until February 2026. This purchase is part of Air New Zealand’s efforts to reduce aviation emissions, with SAF making up 1.6% of its total fuel for the 2025 financial year. SAF reduces emissions by up to 80% compared to conventional jet fuel.
• In January 2024, LG Chem and Enilive signed a joint venture agreement for a biorefinery in South Korea. The facility will convert sustainable feedstocks into biofuels and renewable products, supporting South Korea’s energy transition goals. The collaboration combines LG Chem’s chemical expertise with Enilive’s biofuels capabilities, contributing to the production of low-carbon solutions in line with global sustainability objectives.  
• In June 2024, BP announced that it would acquire full ownership of BP Bunge Bioenergia, a leading Brazilian producer of biofuels, by purchasing Bunge’s 50% stake. This move aims to enhance BP’s bioenergy capabilities. BP also plans to scale back some new biofuels projects while focusing on key developments. The acquisition aligns with BP's goal to grow biofuels and biogas production to meet its 2025 EBITDA target of USD 2.00 billion.
• In February 2023, Eni Sustainable Mobility and PBF Energy announced a partnership to upgrade the St. Bernard refinery in Louisiana into a biorefinery. This collaboration focuses on producing biofuels from renewable sources, supporting the transition to sustainable energy in the U.S. The partnership will also include the supply of low-carbon fuels for the aviation sector, contributing to efforts to reduce GHG emissions in line with global sustainability goals.