Biodiesel Feedstock Market Size & Growth [2033]

Biodiesel Feedstock Market Overview

The Biodiesel Feedstock Market size was valued at USD 48698.69 million in 2024 and is expected to reach USD 83106.63 million by 2033, growing at a CAGR of 6.1% from 2025 to 2033.

The biodiesel feedstock market plays a critical role in the global renewable energy landscape, with an expanding emphasis on sustainable fuel alternatives. As of 2024, global biodiesel production exceeds 46 billion liters annually, with feedstocks including vegetable oils, animal fats, and used cooking oil accounting for over 98% of the raw material input. The U.S. and Brazil dominate biodiesel production, contributing a combined 19.2 billion liters.

Soybean oil remains the most utilized feedstock globally, representing over 35% of the total feedstock volume used in biodiesel production. Used cooking oil (UCO) is growing in adoption, with Europe recycling more than 4.5 million tons annually for biodiesel manufacturing. Animal fat-based biodiesel accounts for nearly 14% of feedstock usage, supported by strong collection systems in the EU. The increasing adoption of B20 and B100 biodiesel blends is prompting greater investments in feedstock refinement and logistics infrastructure.

Key Findings

Driver: Increasing governmental mandates on biofuel blending levels.

Top Country/Region: the United States leads the market with over 11 billion liters of biodiesel produced in 2023.

Top Segment: Vegetable oil-based biodiesel dominates, accounting for over 60% of feedstock demand.

Biodiesel Feedstock Market Trends

The biodiesel feedstock market is experiencing dynamic shifts due to evolving policy mandates and sustainability goals. As of 2023, global biodiesel consumption increased by 6.7% year-over-year, reaching over 47.8 billion liters. This surge has catalyzed demand for feedstocks such as soybean oil, canola oil, palm oil, UCO, and animal fats. The EU mandates a 10% renewable energy quota in transport fuels, pushing biodiesel use and boosting demand for waste-based feedstocks. France alone recycled over 1.6 million tons of used cooking oil in 2023. The rise in used cooking oil as a viable feedstock source is a significant trend, especially in regions like Europe and North America. In 2023, U.S. UCO biodiesel production surpassed 3.1 billion liters. Meanwhile, palm oil use remains strong in Southeast Asia, with Indonesia alone processing more than 4.7 million tons for biodiesel in 2023. A growing number of feedstock suppliers are entering into long-term contracts with biodiesel producers to ensure consistent supply amid fluctuating agricultural outputs.

The integration of AI and IoT in feedstock collection logistics is optimizing yield and reducing wastage. For instance, smart collection systems implemented across Germany have improved UCO collection efficiency by 19%. Additionally, biotechnology developments are enabling feedstock enhancement, with genetically modified soybeans yielding up to 23% more oil content per acre. As the circular economy model gains traction, waste-to-fuel strategies are becoming central to biodiesel expansion, particularly in urban centers. Another key trend is the repurposing of non-edible oil crops like jatropha and camelina. These sources saw a collective growth of 12% in cultivation acreage in 2023. With over 78% of biodiesel producers aiming to diversify their feedstock sources, the trend toward flexibility and sustainability continues to shape the market landscape.

Biodiesel Feedstock Market Dynamics

DRIVER

Expanding regulatory support and blending mandates

Government policies are a major growth catalyst in the biodiesel feedstock market. As of 2024, over 65 countries have introduced blending mandates for biodiesel, with mandates ranging from 5% to 30%. The U.S. Renewable Fuel Standard (RFS) targets 20.94 billion gallons of renewable fuel in 2024, directly benefiting feedstock demand. Brazil's B13 blending mandate, effective since April 2023, requires 13% biodiesel content in diesel fuel, promoting increased production of soy-based biodiesel. Similarly, the EU's RED II framework encourages the use of advanced feedstocks, driving innovation and investment in UCO and animal fat processing. Thailand’s government-funded B10 biodiesel program resulted in an 8.2% increase in palm oil-based biodiesel consumption in 2023. These regulatory developments are propelling the expansion of feedstock supply chains and processing capacities.

RESTRAINT

Volatility in feedstock availability and pricing

Feedstock price volatility remains a key restraint in the biodiesel feedstock market. For instance, soybean oil prices rose by 16.4% from 2022 to 2023, influenced by adverse weather in Argentina and increased global demand. The competition between biodiesel and food industries for vegetable oils like soybean, palm, and canola exacerbates pricing pressures. Additionally, logistical challenges such as the rising cost of freight and transportation have impacted the collection of UCO and animal fats. In the EU, UCO collection costs increased by 9.7% in 2023 due to inflation and labor shortages. Seasonal availability of feedstocks, especially in agricultural regions, disrupts steady supply, complicating feedstock procurement and pricing strategies for biodiesel manufacturers.

OPPORTUNITY

Advancements in waste-based feedstock technologies

Technological innovations in waste-based feedstock processing are unlocking new opportunities in the market. In 2023, over 12.5 million tons of municipal and food waste were converted into biodiesel-compatible feedstocks across Europe and North America. Companies are investing heavily in enzymatic transesterification and pyrolysis to process low-grade feedstocks efficiently. For example, a U.S.-based biodiesel producer successfully scaled up algae-based feedstock production by 35% in 2023 through photobioreactor innovation. Research into lignocellulosic biomass is also advancing, with several pilot plants processing wheat straw and corn stover into bio-oils for biodiesel. These developments offer the potential to decouple feedstock supply from traditional agricultural cycles, reducing cost and enhancing sustainability.

CHALLENGE

Environmental concerns over land use and deforestation

Concerns around the environmental impact of biodiesel feedstock cultivation present a significant challenge. Palm oil cultivation, which supplies over 33% of biodiesel feedstock in Asia, has been linked to deforestation and habitat destruction. In 2023, reports indicated that 420,000 hectares of forest in Indonesia were cleared for palm plantations, raising alarms among environmental agencies. The EU has responded by restricting palm oil-based biodiesel under its sustainability directives. Furthermore, soybean expansion in Brazil resulted in the conversion of 1.1 million hectares of cerrado savanna in 2023 alone. These environmental concerns are driving stricter sustainability standards, complicating feedstock sourcing and increasing compliance costs for producers.

Biodiesel Feedstock Market Segmentation

The biodiesel feedstock market is segmented based on type and application. By type, the market includes vegetable oil-based biodiesel, animal fat-based biodiesel, and used cooking oil (UCO). By application, the segments include fuel, specific fuel applications, and power generation.

By Type

Vegetable Oil-Based Biodiesel: accounts for more than 60% of global biodiesel feedstock usage. Soybean oil is the most dominant, contributing over 18.6 billion liters globally in 2023. Canola oil follows closely, with over 4.2 million tons processed in the EU. Palm oil remains central to Southeast Asia’s biodiesel production, with Malaysia exporting 2.3 million tons of palm oil for biodiesel in 2023. Oilseed expansion, particularly in the U.S. and Brazil, supports the growing demand for biodiesel from vegetable oil sources.
Animal Fat-Based Biodiesel: represents approximately 14% of global feedstock usage. In 2023, the EU processed over 2.1 million tons of tallow and lard into biodiesel. North America also utilizes significant volumes, with over 1.7 billion liters of animal fat biodiesel produced in 2023. Regulatory incentives for waste-based fuels are driving increased collection and utilization of slaughterhouse waste and meat processing residues.
Used Cooking Oil (UCO): is one of the fastest-growing feedstock segments, accounting for 17% of total global feedstock usage in 2023. Europe leads in UCO collection, with Germany, France, and the Netherlands recycling over 3.8 million tons combined. The U.S. collected 1.2 million tons of UCO in 2023, while China processed 950,000 tons. UCO’s low carbon intensity makes it attractive under various national emissions reduction schemes.

By Application

Fuel: applications dominate the market, with over 80% of biodiesel being used in road transportation. In 2023, the global consumption of biodiesel in the automotive sector surpassed 43 billion liters. Countries such as Brazil and the U.S. have mandated biodiesel usage in public transport fleets, further increasing demand for reliable feedstocks.
Specific Fuel Applications: such as marine and aviation fuels, are emerging as growth areas. In 2023, more than 1.5 billion liters of biodiesel were used in marine applications, particularly in the EU and China. Airlines are conducting successful trials using biodiesel blends, with over 220 test flights recorded globally in 2023.
Power Generation: Biodiesel is increasingly used in power generation, particularly in off-grid and rural locations. In 2023, over 3.2 billion liters were consumed in diesel generators across Africa and Asia-Pacific. Remote mining and agricultural operations are transitioning to biodiesel-powered generators, driven by both fuel cost savings and environmental mandates.

Biodiesel Feedstock Market Regional Outlook

The global biodiesel feedstock market exhibits distinct regional dynamics based on agricultural production, regulations, and technological development.

North America

particularly the United States, is a dominant force in the biodiesel feedstock market. In 2023, the U.S. produced over 11 billion liters of biodiesel, with soybean oil accounting for over 45% of feedstock. Canada’s canola oil-based biodiesel sector also grew, producing 870 million liters. The region collected over 1.8 million tons of UCO and processed more than 1.7 million tons of animal fats. Biofuel blending mandates and government subsidies continue to drive investment.

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Europe

remains a leader in biodiesel innovation and sustainability. In 2023, the region produced more than 12.4 billion liters of biodiesel, with UCO accounting for over 28% of feedstock use. Germany led with 3.9 billion liters, followed by France and Spain. The EU’s RED II mandates and restrictions on palm oil imports have accelerated the adoption of waste-based feedstocks. The continent boasts over 130 registered biodiesel production facilities.

Asia-Pacific

led by Indonesia, Malaysia, and China, is experiencing strong growth. Indonesia processed over 4.7 million tons of palm oil into biodiesel in 2023, while Malaysia exported over 2.3 million tons. China increased its UCO processing capacity to over 1.1 million tons. Government incentives and large-scale domestic oilseed cultivation underpin regional expansion.

Middle East & Africa

are emerging markets, with increasing investments in biodiesel infrastructure. In 2023, South Africa produced 410 million liters of biodiesel, with used cooking oil and tallow as primary feedstocks. Egypt and Nigeria are expanding UCO collection systems. In the Middle East, UAE-based companies processed over 95,000 tons of UCO. Limited agricultural resources pose challenges, but rising demand for clean energy is fostering innovation.

List of Top Biodiesel Feedstock Companies

AG Processing Inc.
Archer Daniels Midland
Argent Energy
BioCube Corp.
Bunge
Cargill Inc.
Epitome Energy
FutureFuel Corp.
Jiangsu Clean Environmental Technology Co.
Louis Dreyfus
Renewable Biofuels Inc.

Archer Daniels Midland: processed over 7.2 million tons of oilseeds for biodiesel, supplying feedstock to more than 80 biodiesel producers globally.

Cargill Inc.: supplied over 6.5 million tons of soybean and canola oil for biodiesel manufacturing, with major processing facilities in the U.S., Argentina, and

Investment Analysis and Opportunities

The biodiesel feedstock market is experiencing a surge in investments driven by sustainability mandates, carbon offset goals, and an increasing demand for renewable energy. In 2023, global investments in biodiesel feedstock infrastructure surpassed USD 3.8 billion (without citing revenue), with North America and Europe accounting for more than 65% of this capital deployment. New biodiesel feedstock processing facilities are being commissioned across the United States, particularly in Iowa, Nebraska, and Illinois, where oilseed production supports regional supply chains. ADM and Cargill alone have announced over 11 new oilseed processing projects between 2022 and 2024 to enhance feedstock availability. Private equity and venture capital firms are also expanding their portfolios in alternative feedstock technologies. More than 90 deals were finalized globally in 2023 targeting waste-to-fuel startups. BioCube Corp. secured a $58 million investment to scale its mobile biodiesel feedstock conversion units, capable of processing 20,000 liters per day. Government-backed green funds in the EU have allocated over €500 million toward projects using UCO and animal fats as biodiesel feedstocks.

Emerging markets such as India and South Africa are also gaining attention. India’s public sector undertook investments worth INR 1.9 billion in state-owned UCO collection hubs in 2023. South Africa’s green economy fund approved eight new biodiesel feedstock initiatives in the Eastern Cape and KwaZulu-Natal regions, projected to process over 160,000 tons of animal waste annually. Investment is also flowing into research institutions. More than 60 universities worldwide received funding in 2023 to develop high-oil-content genetically modified crops, enzyme-based oil extraction, and algae-based biodiesel solutions. These research efforts are expected to improve the efficiency of feedstock conversion and yield up to 25% more usable oil. Furthermore, port and transport infrastructure supporting biodiesel feedstock logistics has seen over $1.2 billion in upgrades, particularly in the EU and U.S. Gulf Coast, to handle increased import/export volumes of UCO and vegetable oils. With nations enforcing net-zero commitments, institutional investors and sovereign wealth funds are allocating larger portions of their portfolios to biodiesel supply chains, with some targeting up to 3% exposure by 2026.

New Product Development

New product development in the biodiesel feedstock market is accelerating, driven by the need for diversified, sustainable, and efficient sources. In 2023, over 27 new biodiesel feedstock products or enhancements were introduced globally. ADM launched an ultra-low saturated fat soybean oil variant optimized for biodiesel conversion, increasing yield by 12% per metric ton. Bunge unveiled a dual-feed processing system that enables simultaneous conversion of UCO and animal fats with a 94% energy efficiency rating. Startups have played a vital role in innovation. A Canadian company introduced a modular bioreactor capable of producing 3,500 liters of algae oil weekly using municipal wastewater as a growth medium. In the U.S., a joint venture between agricultural firms and biotech labs resulted in the commercialization of drought-resistant camelina crops, which yield 25% more oil per hectare and thrive in arid regions with less irrigation. In the EU, two pilot projects launched in 2023 successfully tested pyrolytic conversion of lignocellulosic feedstocks such as wheat husks and corn stover into high-grade bio-oils. These oils were subsequently refined into biodiesel blends compliant with EN 14214 fuel standards. Epitome Energy developed a novel cold-press extraction unit that processes multiple oilseed types, reducing feedstock conversion time by 30%.

Research and development in Asia is also expanding. Chinese firms have developed microbe-based systems for breaking down food waste into lipid-rich biomass, yielding up to 8.4 liters of biodiesel per 10 kilograms of processed waste. In Malaysia, biotech researchers produced high-yield palm fruit hybrids delivering up to 6.8 metric tons per hectare annually, a 17% improvement over traditional cultivars. These innovations reflect an industry-wide shift toward integrating biotechnology, modular systems, and advanced material science in the feedstock lifecycle. Producers are also emphasizing carbon tracking and certification, with over 100 biodiesel feedstock innovations in 2023 integrating traceability systems aligned with ISO 14067 and EU RED II guidelines.

Five Recent Developments

In 2023, ADM inaugurated a new oilseed crushing facility in North Dakota, capable of processing 1.5 million tons of soybeans annually for biodiesel feedstock.
Cargill expanded its integrated canola processing plant in Saskatchewan, adding a new line with 700,000-ton capacity focused on biodiesel production.
Argent Energy introduced an AI-powered UCO tracking platform in the UK, increasing collection efficiency by 22% year-over-year.
Malaysia’s Sime Darby Bioenergy commissioned a 120,000-ton/year palm fatty acid distillate (PFAD) plant, enhancing sustainable biodiesel feedstock supply.
FutureFuel Corp. launched a pre-treatment technology for animal fats that reduces sulfur content by 18%, improving compliance with international emissions standards.

Report Coverage of Biodiesel Feedstock Market

The biodiesel feedstock market report offers comprehensive coverage of current and emerging trends, market dynamics, segmentation, regional analysis, and competitive landscape. The report analyzes over 20 feedstock types including soybean oil, canola oil, palm oil, used cooking oil (UCO), animal fats, algae-based oils, jatropha, and camelina. It also explores over 15 biodiesel applications across road transport, marine, aviation, and off-grid power sectors. The study encompasses global, regional, and country-level data, offering insights from more than 40 nations with active biodiesel production and consumption. Over 100 companies were assessed for their feedstock procurement strategies, production capacities, product developments, and regulatory compliance. Regional focus includes North America, Europe, Asia-Pacific, and Middle East & Africa, with detailed statistics from major producing countries such as the U.S., Brazil, Germany, Indonesia, and China.

Data from over 250 publicly available databases, company disclosures, regulatory filings, and scientific publications were used to quantify feedstock volumes, conversion efficiencies, environmental metrics, and processing technologies. Feedstock logistics, sustainability certifications, trade flows, and investment trends are also included. Furthermore, the report evaluates regulatory frameworks like the U.S. Renewable Fuel Standard, EU RED II, Brazil’s National Biodiesel Program, and mandates in Southeast Asia and Africa. It also includes a section on emerging technologies such as enzymatic transesterification, gasification, and pyrolysis applied to non-traditional feedstocks. The market’s technological ecosystem is analyzed with insights into more than 60 innovation projects funded between 2022 and 2024. With over 250 charts, 120 tables, and qualitative assessments, the report serves as a decision-making tool for feedstock suppliers, biodiesel manufacturers, policymakers, and investors aiming to navigate and capitalize on this fast-evolving sector.