Asia Pacific Biofuel Market Size - By Fuel, By Application, By Feedstock, Growth Forecast, 2025 - 2034

Asia Pacific Biofuel Market Size

According to a recent study by Global Market Insights Inc., the Asia Pacific biofuel market was estimated at USD 29.6 billion in 2024. The market is expected to grow from USD 33.4 billion in 2025 to USD 88.5 billion in 2034, at a CAGR of 11.4%.

• Favorable policy reforms coupled with government incentives for advanced biofuels is accelerating the adoption of advanced biofuels across the region. These reforms aim to diversify feedstock sources, promote second-generation (2G) and third generation (3G) biofuels, and support domestic production through financial incentives. The shift is driven by the need to reduce dependency on fossil fuels, improve energy security, and meet climate targets.
   
• By expanding the scope of eligible feedstocks and technologies, these policies are fostering innovation and attracting private investment. Additionally, the inclusion of brownfield and bolt-on projects under incentive schemes is enabling existing facilities to transition toward cleaner fuel production, thereby reducing capital expenditure and implementation timelines.
   
• In August 2024, the Government of India approved amendments to the Pradhan Mantri JI-VAN Yojana, extending its timeline to 2028–29 and expanding its scope to include advanced biofuels from lignocellulosic biomass, algae, and industrial waste. The revised scheme also supports brownfield and bolt-on projects, aiming to enhance viability and attract investment.
   
• The aviation sector’s decarbonization goals are catalyzing demand for Sustainable Aviation Fuel (SAF) across Asia Pacific. Countries like Japan, Australia, and Singapore are investing in SAF production infrastructure, feedstock supply chains, and regulatory frameworks. SAF is seen as a critical enabler for reducing aviation-related emissions without requiring major changes to existing aircraft or fueling infrastructure.
   
• In October 2025, Japan launched its first commercial SAF plant in April 2025 and has multiple SAF projects in the pipeline, including facilities by ENEOS, Idemitsu, and Cosmo Oil. The government has set a target of 10% SAF adoption by 2030 and is offering tax credits, capital investment support, and regulatory mandates to accelerate deployment.
   
• These initiatives are part of Japan’s broader GX (Green Transformation) policy to achieve carbon neutrality. The push is further supported by international aviation mandates and carbon reduction targets, prompting governments to offer tax incentives, capital subsidies, and R&D support. This trend is also fostering cross-border collaborations to build resilient SAF supply chains in the region.
   
• Increasing concerns for national energy security along with rising fuel import reduction strategies is augmenting the business outlook across the region. Biofuels are increasingly being integrated into national strategies to reduce reliance on imported fossil fuels, especially in countries with limited refining capacity or high import dependency.
   
• In June 2025, the Australian Government identified the Low Carbon Liquid Fuels (LCLF) industry, including SAF and renewable diesel, as a priority under the Future Made in Australia plan. With 80% of its fuel currently imported, Australia is investing over USD 163 million to accelerate domestic LCLF production. The initiative aims to reduce import dependency, strengthen fuel security, and position Australia as a global leader in sustainable fuels.
   

Asia Pacific Biofuel Market Trends

• Expansion of ethanol blending mandates in transport fuels combined with infrastructure development in biofuel economic corridors are of the major factors driving biofuel consumption. These mandates are part of broader national energy transition strategies and are designed to stimulate domestic bioethanol production, reduce fossil fuel imports, and support rural economies through increased demand for agricultural feedstocks.
   
• The expansion of blending targets is also encouraging investment in bio-refineries and supply chain infrastructure. As countries align with global climate commitments, ethanol blending is becoming a key policy lever to decarbonize the transport sector, particularly in urban and high-traffic regions.
   
• For instance, in 2024, Indonesia officially launched its E5 bioethanol blending mandate, requiring 5% ethanol content in gasoline sold in select provinces, including Jakarta and East Java. The initiative is part of the government’s broader strategy to reduce fossil fuel dependency and cut emissions in line with its National Energy Policy.
   
• The development of dedicated biofuel infrastructure within economic corridors is accelerating the commercialization of biofuels in Asia Pacific. Governments are integrating biofuel production and distribution facilities into broader industrial and logistics zones to streamline supply chains and reduce costs. These corridors often benefit from tax incentives, public-private partnerships, and targeted investments in transport, storage, and processing infrastructure.
   
• For instance, in October 2025, the Department of Alternative Energy Development and Efficiency (DEDE), Thailand has started to prepare mandate for the use of Sustainable Aviation Fuel (SAF), starting at 1% on January 1, 2026, and increasing the proportion to 8% by 2036. This in turn will increase the development of biofuel infrastructure across the country, thereby adding to market growth.
   
• The co-location of biofuel plants with feedstock sources and export terminals further enhances operational efficiency and supports regional economic development. Thailand’s Eastern Economic Corridor (EEC) has incorporated biofuel infrastructure into its 2023–2027 development plan. The Ministry of Transport is overseeing 77 infrastructure projects, including clean energy procurement and logistics upgrades to support biofuel distribution.
   
• Asia Pacific countries are increasingly positioning themselves as global suppliers of biofuels, particularly biodiesel and palm-based biofuels. Export-oriented policies are being crafted to leverage abundant feedstock availability and growing international demand for low-carbon fuels. These policies include streamlined licensing, quality certification, and bilateral trade agreements.
   
• For instance, in June 2023, South Korea’s Ministry of Trade, Industry and Energy (MOTIE) launched “Project CE (Circular Economy) 9,” a national strategy to promote circular economy practices across nine major industries. The initiative includes accelerating the production and use of renewable materials and securing alternative sources of fuel materials, including biofuels.
   

Asia Pacific Biofuel Market Analysis

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• Based on fuel, the market is segmented into biodiesel, ethanol, among others. The ethanol segment dominated with 62.2% of the market share in 2024 and is set to grow at a CAGR of 10.3% through 2034. Expansion of ethanol blending mandates along with emergence of second-generation (2G) ethanol technologies is bolstering the product consumption across the region.
   
• Countries like India, Indonesia, and Thailand have set ambitious targets ranging from E10 to E20 blends, supported by policy frameworks and infrastructure upgrades. These mandates are driving demand for bioethanol and encouraging investment in new distilleries and supply chains.
   
• For instance, in July 2025, the government of India announced that the country has achieved 20 percent ethanol blending in petrol in 2025, five years ahead of its original target set for 2030. The expansion is also aligned with national energy security goals, as ethanol reduces dependency on imported gasoline and supports domestic agricultural economies.
   
• In order to address concerns over food-versus-fuel conflicts, Asia Pacific nations are investing in second-generation ethanol technologies that utilize agricultural residues, forestry waste, and municipal solid waste. These technologies offer higher sustainability and lower lifecycle emissions compared to conventional ethanol.
   
• Ethanol is being explored as a component in sustainable aviation fuel (SAF) and marine biofuels. Blended ethanol fuels are being tested for compatibility with existing engines and infrastructure, particularly in short-haul aviation and inland shipping. This trend is driven by international pressure to decarbonize hard-to-abate sectors and the need for drop-in fuel alternatives.
   
• For instance, in August 2025, China National Aviation Fuel Company (CNAF) announced to acquire a stake in a sustainable aviation fuel (SAF) plant controlled by private biofuel producer Henan Junheng Industry Group Biotech Co. This marks CNAF's second such investment in a privately controlled "green" jet fuel maker. This in turn will aid the aviation industry across the country for a sustainable fuel economy.
   
• Biodiesel industry will grow at a CAGR of 11% up to 2034, driven by risen diversification of feedstock sources coupled with strengthening of export-oriented biodiesel policies. Governments and industry players are exploring non-edible oils (e.g., jatropha, pongamia), used cooking oil (UCO), and animal fats to enhance sustainability and reduce competition with food crops.
   
• For instance, in July 2025, Chinese biodiesel producer, Zhuoyue New Energy has announced plans to invest around USD 97 million to build a biofuel production facility in Thailand’s Chonburi province. The project to be initiated in phases with first phase set to produce 300,000 tons of biodiesel annually. The second phase will add capacity for 100,000 tons per year of either hydrotreated vegetable oil (HVO) or sustainable aviation fuel (SAF).
   

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• Based on applications, the Asia Pacific biofuel market is segmented into transportation, aviation, and others. The transportation segment held a market share of 68.8% in 2024 and will grow at a CAGR of 11.4% through 2034. Asia Pacific countries are aggressively expanding biofuel blending mandates to reduce fossil fuel dependency and curb emissions.
   
• Urban transport systems and commercial fleets are increasingly adopting biodiesel and ethanol derived from non-food feedstocks such as used cooking oil (UCO), agricultural residues, and algae. This diversification helps address sustainability concerns and reduces competition with food crops.
   
• For instance, in October 2025, the government of Indonesia proposed to make biodiesel containing 50% palm oil, known as B50, mandatory by 2026, aiming to reduce imports of gasoil. This is estimated to increase the country's potential towards generation of carbon free fuel from vegetable oil, thereby reducing reliance on other imported feedstock including coarse grain, thus strengthening its regional presence across the globe.
   
• Biofuels are being integrated into broader national energy transition strategies across Asia Pacific. Countries are aligning transport biofuel use with net-zero targets and carbon neutrality goals. This includes fiscal incentives, infrastructure upgrades, and public-private partnerships to scale production and distribution.
   
• For instance, in January 2025, Hyundai Motor Group planned to invest over USD 16 billion in research and development (R&D), facility expansion, and strategic industries in the country in 2025. This in turn will result in the production of vehicles, which eventually will lead to a higher energy need, promoting the adoption of biofuel across the region.
   
• Aviation application industry will reach cross USD 22 billion by 2034, driven by emergence of Sustainable Aviation Fuel (SAF) projects and policy support and regional SAF mandates. Countries like Malaysia, Thailand, and Singapore are investing in SAF production using waste-based feedstocks such as UCO and palm oil mill effluents.
   
• For instance, in August 2025, EcoCeres, Inc., has partnered with Xiamen Airlines to collect and transport waste cooking oil from selected restaurant partners through its established supply chain. The waste oil will be processed at EcoCeres’ production plants to produce high-quality Sustainable Aviation Fuel (SAF). This in turn will drop the usage of conventional jet fuel that can significantly reduce lifecycle carbon emissions.
   
• Governments are introducing SAF blending mandates and incentives to accelerate adoption. These include tax credits, carbon offset schemes, and R&D funding. Asia Pacific countries are aligning with international frameworks like CORSIA and developing national SAF roadmaps to support commercial deployment and scale production.
   

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• Indonesia dominated the Asia Pacific biofuel market with around 50% share in 2024 and generated USD 15 billion in revenue. The country’s growth is driven by community-based biofuel development and intensification of existing palm oil plantations. The community-based biofuel development model promotes decentralized biodiesel production using diverse feedstocks like used cooking oil and non-palm crops.
   
• For instance, in early 2025, the government of Indonesia launched B40 program that mandates blending 40% per cent palm oil with diesel fuel. The program was aimed at boosting domestic biofuel use and supporting local plantation companies. In addition, the program will stimulate downstream investment in biodiesel refineries, blending facilities and storage systems.
   
• India biofuel market will grow at a CAGR of 12.1% by 2034. Emergence of advanced biofuels from non-food feedstocks along with increasing mandates towards ethanol blending targets is influencing the industry dynamics. Various technologies are being scaled through public-private partnerships and are being witnessed as key to reducing feedstock competition and enhancing sustainability.
   
• For reference, in September 2025, the government of India urged biofuel producers in the country to increase ethanol production for global export. The same will drive sustainable growth and will advance India's circular bioeconomy in the global market, which in turn will positively influence the market outlook down the line.
   
• China’s biofuel industry will grow at a rate of over 8.9% by 2034. Strategic expansion of biomass fuel production along with export-oriented biodiesel strategy amid trade challenges will sway the market. China is rapidly scaling up its biomass fuel production, particularly in the form of compressed agricultural and forestry waste pellets. These fuels are being positioned as a key renewable alternative for industrial heating and clean residential energy.
   
• For instance, as per the 2025 China Biomass Fuel Industry Development Report, China produced 22 million tons of biomass pellets in 2024, accounting for 27% of global output. The report highlights biomass as a critical component of China’s dual-carbon strategy and forecasts demand to reach 50 million tons by 2030.
   
• South Korea’s biofuel industry will reach USD 2.5 billion by 2034, driven by regulatory reform to accelerate biofuel production and increasing investment in SAF and hydrogenated vegetable oil (HVO). The country has revised its Petroleum and Alternative Fuels Business Act to simplify biofuel production. Refiners can now co-process waste oils and plastics without prior government approval, enabling faster scaling of biodiesel and SAF.
   
• For instance, in January 2024, S-OIL began to introduce bio-based feedstocks, including used cooking oil and the byproducts of the palm oil, to produce low-carbon fuels such as sustainable aviation fuel (SAF). It will produce eco-friendly chemicals, using plastic-based waste pyrolysis oil, thereby contributing to resolving the waste plastic problem. 
   

Asia Pacific Biofuel Market Share

• The top 5 companies in Asia Pacific biofuel industry including Indian Oil Corporation Ltd., PT Pertamina, Wilmar International, Sinopec, and Petronas held over 30% market share in the year 2024.  IOCL holds a significant position in India’s biofuel sector, driven by its expansive ethanol blending program and multiple 2G bio-refinery projects.
   
• SK Innovation is advancing rapidly in the SAF and HVO segments, backed by South Korea’s regulatory reforms. Its investments in co-processing and dedicated biofuel facilities reflect a strategic pivot toward low-carbon fuels. The company’s innovation-driven approach is enhancing its competitiveness in the Asia Pacific biofuel market.
   
• Musim Mas is one of Southeast Asia’s largest biodiesel producers, with a strong export orientation. Its sustainability certifications and efficient palm oil processing operations make it a preferred supplier in global markets. The company’s scale and compliance with international standards bolster its Asia Pacific market share.
   

Asia Pacific Biofuel Market Companies

Major players operating in the Asia Pacific biofuel industry are:

• Bangchak Corporation
• Carotino Sdn Bhd
• China National Petroleum Corporation
• COFCO Biochemical
• EcoCeres, Inc.
• Felda Global Ventures
• HD HYUNDAI
• Indian Oil Corporation Ltd.
• Manildra Group
• Musim Mas Group
• Petronas
• Praj Industries
• PT Pertamina
• PTT Public Company Limited
• Shree Renuka Sugars Ltd.
• Sinopec
• SK Innovation
• S-Oil Corporation
• Viva Energy Group
• Wilmar International
   
• PT Pertamina, Indonesia’s state-owned company is a dominant biodiesel producer, benefiting from the country’s aggressive B30 and B35 blending mandates. Its integrated supply chain, from palm oil sourcing to refining, positions it as a regional leader. In 2024, the company reported a net profit of USD 3.13 billion, reflecting strong operational performance and government support. Pertamina’s export initiatives and SAF initiatives further enhance its Asia Pacific market influence.
   
• Wilmar International Ltd., headquartered in Singapore, is a major biodiesel exporter with operations spanning Indonesia, Malaysia, and China. In the first half of 2025, Wilmar posted revenues of USD 32.8 billion and a net profit of USD 594.9 million, driven by strong performance in its plantation and food products segments. The company’s strong presence in both domestic and international markets secures its role as a top-tier player in the Asia Pacific biofuel landscape.
   
• SK Innovation is advancing rapidly in the SAF and HVO segments, backed by South Korea’s regulatory reforms. Its investments in co-processing and dedicated biofuel facilities reflect a strategic pivot toward low-carbon fuels. The company’s innovation-driven approach is enhancing its competitiveness in the Asia Pacific biofuel market.
   

Asia Pacific Biofuel Industry News

• In October 2025, the Grain Ethanol Manufacturer’s Association (GEMA) in India has called on the government to speed up the rollout of higher ethanol blends and fast-track the nationwide adoption of flex-fuel vehicles (FFVs). The move will align the company’s biofuel strategy with the best global practices, reduce dependence on fossil fuels, and support the nation’s goal of achieving net-zero emissions by 2070.
   
• In September 2025, Australia committed about USD 735 million over the next 10 years to develop a low-carbon fuels industry, with funds earmarked beginning in 2028. The initiative aims to enhance private investment in biofuels including biodiesel and sustainable aviation fuel.
   
• In March 2025, the government of China increased its 2025 budget for building stocks of grains, edible oils and other agricultural commodities by 6.1% year-on-year to USD 18.1 billion. This will aid in the increase of biofuel production through various grains, edible oils, among others, in turn adding to industry growth.
   

This Asia Pacific biofuel market research report includes in-depth coverage of the industry with estimates & forecast in terms of revenue (USD Million) and Volume (Mtoe) from 2025 to 2034, for the following segments:

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Market, By Fuel

• Biodiesel
• Ethanol
• Others

Market, By Application

• Transportation
• Aviation
• Others

Market, By Feedstock

• Coarse grain
• Sugar crop
• Vegetable oil
• Others

The above information has been provided for the following countries:

• China
• India
• Indonesia
• Australia
• South Korea