Advanced Biofuels Market Size to Hit USD 42.27 Billion by 2035, at 9.06% CAGR | Research by SNS Insider

The U.S. advanced biofuels market was valued at USD 4.77 billion in 2025 and is projected to reach USD 10.87 billion by 2035, growing at a CAGR of 8.63% from 2026 to 2035. Growth is supported by favorable government policies, renewable fuel mandates, rising demand for low-carbon transportation fuels, advances in biofuel technologies, and increased adoption of bioethanol, biodiesel, and renewable aviation fuels.

Austin, Jan. 23, 2026 (GLOBE NEWSWIRE) — Advanced Biofuels Market Size & Growth Insights:

According to the SNS Insider, “The Advanced Biofuels Market Size was valued at USD 17.82 Billion in 2025 and is projected to reach USD 42.27 Billion by 2035, growing at a CAGR of 9.06% during 2026-2035.”

Environmental Concerns and Technological Advances to Augment Market Expansion Globally

Growing environmental concerns and the pressing need to cut greenhouse gas emissions are the main factors propelling the expansion of the worldwide advanced biofuels market. To reduce carbon emissions from the transportation and industrial sectors, governments around the world are enforcing strict laws and requirements for renewable fuels. Industry and consumer adoption of sustainable alternatives is being further encouraged by rising fuel prices and the unpredictability of the fossil fuel markets. Advanced biofuels are now more affordable thanks to technological developments in feedstock conversion, such as lignocellulosic biomass, algae, and waste oils, which have improved production efficiency and scalability.

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Leading Market Players with their Product Listed in this Report are:

• Neste Corporation
• Chevron Corporation
• BP plc
• TotalEnergies SE
• Royal Dutch Shell plc
• POET LLC
• Renewable Energy Group, Inc. (REG)
• Gevo, Inc.
• Verbio AG
• Raízen S.A.
• UPM‑Kymmene Corporation
• Eni S.p.A.
• Abengoa Bioenergy
• Clariant AG
• LanzaTech
• LanzaJet Inc.
• Aemetis, Inc.
• Enerkem Inc.
• Algenol Biotech
• GranBio

Advanced Biofuels Market Report Scope:

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Key Segmentation Analysis

By Biofuel Type

Bioethanol dominated with 38.87% in 2025 due to its compatibility with existing vehicles and fuel infrastructure. Biojet Fuel / Renewable Aviation Fuel is expected to grow at the fastest CAGR of 9.78% from 2026 to 2035 driven by global aviation decarbonization initiatives, airline commitments to sustainable fuels, and increased government support for cleaner air travel.

By Feedstock

Lignocellulosic Biomass dominated with 34.76% in 2025 due to their wide availability sourced from agricultural residues and wood. Algae is expected to grow at the fastest CAGR of 10.22% from 2026 to 2035 due to their high yield potential, non-competition with food crops, and suitability for next-generation biofuels.

By Application

Transportation dominated with 53.12% in 2025 and it is expected to grow at the fastest CAGR of 9.39% from 2026 to 2035 as advanced biofuels were primarily used to reduce emissions in mobility sectors.

By End-User

Automotive Manufacturers & Fleet Operators dominated with 41.55% in 2025 driven by the push for greener fleets. Airlines & Aviation Companies is expected to grow at the fastest CAGR of 9.54% from 2026 to 2035 as they are increasingly adopting sustainable fuels to meet environmental targets and reduce carbon footprints.

Regional Insights:

In 2025, North America dominated the global advanced biofuels market with a 34.24% share, driven by supportive government policies, renewable fuel mandates, and well-established biofuel infrastructure. 

The Asia Pacific advanced biofuels market is expected to grow at the fastest CAGR of 9.94% from 2026 to 2035, driven by rising energy demand, rapid urbanization, and increasing focus on sustainable transportation. 

Feedstock Limitations, Conversion Complexity, and Regulatory Challenges May Hamper Market Expansion Globally

Seasonal fluctuations and feedstock availability provide challenges to the worldwide advanced biofuels business, potentially limiting steady output. Rapid adoption is hampered by time-consuming and complicated conversion technologies as well as a lack of extensive large-scale infrastructure for blending and delivery. Market expansion may be slowed by national regulatory variations and uncertainty surrounding the application of policies. Additionally, producers around the world face operational and logistical obstacles due to competition from first-generation biofuels and conventional fossil fuels, as well as technical difficulties in scaling next-generation fuels, such as biojet and algae-based biofuels.

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Recent Developments:

• In May 2025, Neste began supplying sustainable aviation fuel to FedEx at Los Angeles International Airport, marking FedEx’s first major U.S. SAF deployment.
• In November 2024, Chevron inaugurated the Ames Technology Center in Iowa to boost R&D in lower‑carbon fuels including biodiesel, renewable diesel, sustainable aviation fuel (SAF), and renewable natural gas.

Exclusive Sections of the Advanced Biofuels Market Report (The USPs):

• BIOFUEL TYPE REVENUE SHARE METRICS – helps you understand the market contribution of bioethanol, biodiesel, biobutanol, and biojet fuel across the advanced biofuels landscape.
• PRODUCTION COST BENCHMARKS BY BIOFUEL TYPE – helps you compare cost competitiveness and margin potential across different advanced biofuel pathways.
• HIGH-GROWTH BIOFUEL SEGMENT TRACKING – helps you identify faster-growing fuels such as biojet fuel and biobutanol versus conventional bioethanol and biodiesel.
• PRODUCTION EFFICIENCY & SCALE-UP INDICATORS – helps you assess operational performance and scalability across advanced biofuel manufacturing technologies.
• COMMERCIAL VIABILITY & COST OPTIMIZATION INSIGHTS – helps you evaluate which advanced biofuel types are best positioned for large-scale adoption and long-term profitability.

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