Biofuel Additives Market Overview:
Global Biofuel Additives Market is expected to garner $12,560 million by 2022, registering a CAGR of 15.3% during the forecast period 2016-2022.
Increasing demand for clean & efficient fuel, diminishing quality of crude oil, high quality standards associated with biofuels, and growing automotive industry are the significant factors responsible for the growth of the biofuel additives market across the globe.
Biofuels are produced from the conventional feedstock or lignocellulose feedstock, which can be distinguished as first and second generation fuels. The consumption of biofuels has increased across the globe owing to its eco-friendly nature. However, there are several problems associated with their use such as high fuel foaming, injector deposits & corrosions, and low oxidation stability. Biofuel additives are specialty chemicals that are added to decrease such problems. Therefore, the market for biofuel additives is directly aligned with the production of biofuels.
However, food verses fuel debate and high investment on the biofuel additives production technology is likely to hamper the market growth.
The market has been segmented on the basis of type, application, and geography. On the basis of type, the market is segmented into antioxidants, corrosion inhibitors, cold flow improvers, detergents & dispersants, octane & cetane improvers, dyes & markers, and others. In 2015, the detergents & dispersants segment occupied one-third share in the overall biofuel additives market, in volume terms. This is due to compulsion of detergents & dispersants by the government as it cleans the fuel supply arrangement.
Based on end user of additives i.e. biofuels, the market is segmented into bioethanol and biodiesel. The bioethanol segment occupied more than half of the overall biofuel additives market due to increasing adoption of bioethanol-blended gasoline fuels in North America. Furthermore, the market has been segmented on the basis of geographical regions, which include North America, Europe, Asia-Pacific, and LAMEA. In addition, the consumption of biofuel additives in different countries has also been included in the report. In 2015, North America occupied two-fifths of the total biofuel additives market, in volume terms. However, Asia-Pacific is expected to be the fastest growing region during the analysis period.
The leading companies in this market have been proactively working towards the launch of new products, as biofuels are new adoption in the fuel industry. The major companies profiled in the report includes The Lubrizol Corporation, Fuel Quality Services, Inc., Chemiphase Ltd., Clariant AG, Afton Chemical, E-ZOIL, Eastman Chemical Company, Evonik Industries AG, Chevron Oronite Company LLC, and Biofuel Systems Group Ltd.
Biofuels are produced from food crops as well as lignocellulosic biomass. They are classified as first- and second-generation biofuels depending on whether it is produced from food crops through fermentation or lignocellulosic biomass through advanced enzymatic hydrolysis. They are commercially available as bioethanol as a replacement for gasoline (petrol) and biodiesel as a replacement for petroleum diesel. Pure biofuels have not replaced all the petroleum fuels yet; however, they are blended with petroleum fuels in different ratios depending on the regulations across different geographies.
The blended biofuels give rise to several problems, such as corrosion in the fuel system or in the transit vehicles, increase in the fuel foaming, oxidation, deposit accumulation in the system, and others, which can be controlled by the addition of biofuel additives. There are various types of additives available in the market, such as antioxidants, corrosion inhibitors, cold flow improvers, detergents & dispersants, and octane & cetane improvers, among others. The composition and treatment rates of the additives vary with the type of biofuel, source of biofuel, and regional regulations.
Restraints & Opportunities
Top factors impacting global biofuel additives market
Source: AMR Analysis
Food vs. Fuel Debate
The rapid increase in the global population raises the demand for food and energy for improved life. Therefore, the questions arising under the “Food vs. Fuel” debate are how much arable land is available, what should be the priority, and how should the land be used, among others. There is an increased debate on the increasing prices of food due to the crops utilized for the manufacturing of biofuels. For example, in 2012, Peter Brabeck-Letmathe, Chairman of Nestle, stated, “If no food was used for fuel, the prices would come down again-that is very clear.” In addition, Paul Conway, Chairman of Cargill, stated, "The bigger picture globally is increased urbanization, which leads to more food being consumed...there has also been an explosion in biofuel use and the financializing of the agricultural markets." The increasing number of such debates has decreased the adoption of biofuels to certain extent and the biofuel producers are conducting studies on the alternate sources of biofuels. Therefore, decreasing biofuel adoption has reduced the demand for biofuel additives across the globe.
The Food vs. Fuel debate has considerably decreased the growth of the biofuel additives market. However, with increasing advancement in second-generation biofuels, the impact of this driver is expected to decrease during the forecast period.
High Cost of Biofuel Additives
The prices of the additives used in biofuels are comparatively higher than those of the additives used in petroleum fuels. Typically, the cost of additives to a gallon of biodiesel varies in the range of 6‐8 cents compared with only 2‐3 cents in case of petroleum diesel. In addition, a fuel seller earns a profit between $50 and $150 by selling a tanker, given the tanker load is 7,500 gallons. In such a low profit, usually fuel sellers are not able to bear the extra biofuel additive cost. Therefore, high price of biofuel additives negatively affects the market. However, with the advancement in the biofuel additives production process, the impact of this driver is expected to decrease during the analysis period.
KEY MARKET BENEFITS:
- The report provides an extensive analysis of the factors that drive as well as restrain the growth of the global biofuel additives market.
- The market projections for the period 2015-2022 have been included along with the impacting factors.
- The report also provides quantitative as well as qualitative trends to help the stakeholders in understanding the market scenario.
- In-depth analyses of the key segments of the market demonstrate the consumption of biofuel additives in different applications across different end user industries.
- SWOT analysis facilitates the study of the internal environment of leading companies for strategy formulation.
- Competitive intelligence highlights the business practices adopted by the leading market players across various geographies.
BIOFUEL ADDITIVES MARKET KEY SEGMENTS:
Global biofuel additives market is segmented as:
Biofuel Additives Market - By Type
- Corrosion Inhibitors
- Cold Flow Improvers
- Detergents & Dispersants
- Octane & Cetane Improvers
- Dyes & Markers
Biofuel Additives Market - By Biofuel type
Biofuel Additives Market - By Geography
- North America