Biofuel Production Up Despite Economic Downturn

Alice McKeown | Dec 17, 2009

Global biofuel production topped 81 billion liters in 2008, an increase of more than 36 percent over the previous year.1 This includes more than 66 billion liters of fuel ethanol and nearly 15 billion liters of biodiesel.2 (See Figure 1.) However, growth in biofuel output is projected to slow significantly in 2009 to below 10 percent.3 Combined biofuel production has increased more than 350 percent since the start of the decade, and biofuels now make up some 1.67 percent of the total world liquid fuel supply, up 0.4 percentage points since 2007.4

The United States and Brazil dominate the global ethanol industry, producing the fuel primarily from corn and sugarcane respectively. In 2008, the United States produced nearly 35 billion liters, more than 53 percent of the global total.5 (See Figure 2.) The U.S. ethanol market experienced a significant downturn in 2008 and had nearly 5.8 billion liters of refinery capacity idled by the middle of 2009, though there is still considerable potential for growth.6 In late 2009 there were 202 refineries with a total capacity of 49.7 billion liters and more than 5.4 billion liters of new capacity in development.7

Brazil produced 37 percent of the world’s ethanol in 2008, at 24.2 billion liters.8 By late 2009 there were 159 ethanol distilleries and 248 additional mills that produce both sugar and ethanol.9 Ethanol production capacity is also expected to increase in Brazil due to continued national and foreign investments.10 About 90 percent of ethanol production is concentrated in the south central part of the country, with the remainder in the northeast.11

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