The US is the world leader for advanced biofuels ventures and is predicted to continue dominating this market, according to new research.
Although conventional biofuels derived from food-based crops account for only about 5% of global liquid fuels consumption in the transportation sector today, advanced biofuels – which avoid many of the social and environmental externalities that have undermined first-generation ethanol and biodiesel – offer long-term scalability and potential market growth across all global regions, says Navigant Research.
While the US ranks highest in the advanced biofuels country ranking index, China comes second in the global league with 3%, just ahead of Germany (3rd) and France (4th). An early ethanol pioneer, Brazil is ranked No. 5 overall.
Navigant forecasts that advanced biofuels scale-up is likely to be concentrated in the key markets of the US, Brazil, China, and the European Union member states.
“The United States is currently home to an estimated 67% of global ventures in advanced biofuels, and the Renewable Fuel Standard, which calls for 21billion (US) gallons of advanced biofuel production by 2022, will help keep the US at the epicenter of the market going forward,” says Mackinnon Lawrence, principal research analyst with Navigant Research.
“Emerging opportunities for advanced biofuels growth, across a diverse range of non-food feedstocks and conversion platforms, are beginning to coalesce in a number of countries outside the US as well.”
Navigant expects growth in advanced biorefinery infrastructure will be moderate through 2015 as new commercial facilities seek to demonstrate viability at scale and government support retreats from post-stimulus highs across the United States, Europe, and China.
Over the medium term (2015-2018), however, a wave of retrofits and further investment linked to conventional biorefinery infrastructure is expected to usher in a dramatic expansion of advanced bio-refinery capacity, followed by an increase in greenfield projects.
This would appear to match the huge increase in land given over to biofuels cropping.
Since the food crisis of 2007-2008, foreign direct investment into countries with undeveloped agricultural potential has accelerated, according to data compiled by the Oakland Institute, Oakland, California.
It has estimated that 56million hectares of land (nearly the size of France) has been acquired in the developing world by international governments and investors since 2008.
In September, China announced that it will invest billions of yuan into 3million hectares (7.5million acres) of farmland in Ukraine, its biggest overseas agricultural project.
This will more than double China’s current 2million hectares (5million acres), mostly concentrated in Latin America and Southeast Asia.
However, the most controversial deal of all is Daewoo’s attempt to buy up a massive slice of Madagascar to enable biofuels cropping.
According to the Woodrow Wilson International Center in Washington DC: “One of the largest and most notorious deals is one that ultimately collapsed: an arrangement that would have given the South Korean firm Daewoo a 99-year lease to grow corn and other crops on 1.3million hectares of farmland in Madagascar – half of that country’s total arable land.”
Back to the Navigant report, “Advanced Biofuels Country Rankings”; this provides an assessment of the potential for global advanced biofuels production based on four assessment frameworks: liquid fuel demand, feedstock opportunity, market drivers, and market investment.
All told, 69 countries are assessed across 19 macroeconomic and policy-related criteria. Download the report on the Navigant Research website.