Fatty Acid Methyl Ester Market Size 2023, Forecast By 2032 (2024)

Market Synopsis

The global Fatty Acid methyl ester market size was USD 21.41 Billion in 2022 and is expected to reach USD 36.17 Billion in 2032, and register a revenue CAGR of 6% during the forecast period. A number of variables, such as the rising demand for biodiesel and biolubricants as well as the shift to renewable and sustainable energy sources, are driving the market revenue growth.

With its environmentally beneficial nature it is produced from renewable resources such as vegetable oils and animal fats biodiesel is becoming more popular. Using biodiesel helps create a cleaner, healthier environment by lowering greenhouse gas emissions. The demand for Fatty Acid Methyl Ester (FAME), the main feedstock used in the production of biodiesel, is being driven by growing awareness of the environmental benefits of biodiesel.

The need for ecologically friendly lubricants in a variety of applications, including automotive, industrial, and marine, is also rising. Compared to conventional petroleum-based lubricants, biolubricants are biodegradable and have a smaller negative impact on the environment. FAME is increasingly being used as a feedstock for biolubricants, which is driving market revenue growth.

Also, the chemical industry's rising need for FAME in the production of plasticizers, Solvents, and Surfactants is driving market revenue growth. With its biodegradability and low toxicity, FAME is a versatile substance that may be employed in a variety of industrial applications, and its demand is expected to rise during the forecast period.

The demand for FAME is also being driven by rising need for energy security and transition to renewable and sustainable energy sources. The use of biofuels is being encouraged by governments across the globe through the implementation of laws and incentives, which is expected to create a high demand for FAME in the upcoming years.

In addition, rising FAME demand in emerging countries such as China, India, and Brazil is expected to drive revenue growth of the market. Rapid development and urbanization are taking place in these countries, which is creating a high demand for clean, sustainable energy sources. In the upcoming years, it is expected that the usage of biofuels will increase in these countries, creating high demand for FAME.

The availability and cost of feedstocks, quality and consistency of FAME, and the competition from alternative renewable fuels such as ethanol and biodiesel derived from different feedstocks including algae and waste oils are some of the major factors restraining the market revenue growth.

With the rising demand for biodiesel, biolubricants, and renewable energy sources, the global fatty acid methyl ester market revenue growth is expected to be driven rapidly during the forecast period. The transition to renewable and ecologically friendly energy sources, rising demand for FAME in the chemical industry, and rising FAME consumption in developing countries are some of the factors driving the market revenue growth. The availability and cost of feedstocks, the consistency and quality of FAME, and the competition from other renewable fuels are some of the factors that restrict market revenue growth.

Government Regulations:

• The European Commission has established regulatory standards for fatty acid methyl esters used in biodiesel production.
• The U.S. Department of Energy’s Renewable Fuel Standard (RFS) requires that certain renewable fuels, including biodiesel, meet minimum volume requirements in order to be sold or distributed within the United States.
• The U.S. Environmental Protection Agency (EPA) has established regulatory standards for the production, distribution and sale of biodiesel in the United States.
• The U.S. Department of Agriculture (USDA) has established the Biodiesel Fuel Education Program, which provides educational materials and resources to promote the use of biodiesel fuels in the US.
• The U.S. Environmental Protection Agency’s Renewable Identification Number (RIN) program requires producers of renewable fuels, including biodiesel, to register with the EPA and track credits associated with each gallon of fuel produced.

Type Outlook:

The global Fatty Acid Methyl Ester (FAME) market has been segmented into various types including Soy Methyl Ester, Palm Oil Methyl Ester, Rapeseed Methyl Ester, Animal Fat Methyl Ester, and Others. Among these, the Soy Methyl Ester segment accounted for the largest revenue share in 2022. The high demand for Soy Methyl Ester is primarily due to its numerous benefits such as lower emissions, biodegradability, and non-toxicity, making it a preferred choice in various industries. Additionally, the increasing demand for biodiesel as a sustainable alternative to fossil fuels is driving the growth of the Soy Methyl Ester segment. Moreover, the easy availability of soybean oil is further propelling the growth of the Soy Methyl Ester market.

The Palm Oil Methyl Ester segment is expected to register significant revenue growth during the forecast period. This growth can be attributed to the widespread availability of palm oil and the numerous advantages offered by palm oil methyl esters, including superior lubricity, better stability, and higher oxidation stability. The rising demand for biodiesel is also driving the growth of the Palm Oil Methyl Ester market. Additionally, governments across the globe are promoting the use of palm oil methyl esters as a renewable and sustainable alternative to traditional fuels, which is further boosting the growth of this segment.

The Rapeseed Methyl Ester segment is expected to witness moderate revenue growth during the forecast period. Rapeseed methyl ester is a renewable fuel that offers several benefits, such as high energy Content, lower emissions, and improved engine performance. The growing demand for renewable energy sources and the increasing use of biodiesel as a sustainable alternative to traditional fuels is driving the growth of the Rapeseed Methyl Ester market.

The Animal Fat Methyl Ester segment is expected to register significant revenue growth during the forecast period. The high demand for animal fat methyl esters is primarily due to its low cost and high availability. Animal fat methyl esters are produced from animal fats and are used as a renewable fuel in various industries. Additionally, the increasing demand for renewable energy sources is driving the growth of the Animal Fat Methyl Ester market.

The Others segment includes methyl esters derived from various sources such as sunflower, jatropha, and coconut. This segment is expected to witness moderate revenue growth during the forecast period. The growing demand for sustainable and renewable fuels is driving the growth of this segment. Additionally, the increasing focus on reducing greenhouse gas emissions and promoting sustainable development is further boosting the growth of the Others segment.

the Fatty Acid Methyl Ester (FAME) market is witnessing significant growth, driven by the increasing demand for sustainable and renewable fuels. The market is segmented into various types, including Soy Methyl Ester, Palm Oil Methyl Ester, Rapeseed Methyl Ester, Animal Fat Methyl Ester, and Others, each offering its unique advantages and benefits. The growth of each segment is driven by various factors, including availability, cost, benefits, and government initiatives.

Application Outlook:

In terms of revenue, the fuel sector dominated the fatty acid methyl ester market in 2022. Due to its eco-friendly characteristics and low emissions, FAME has seen a substantial growth in demand as a biodiesel fuel in recent years. Through a procedure known as transesterification, FAME is made from vegetable or animal fats. By using FAME in diesel engines, air pollution-causing emissions of greenhouse gases, particulate matter, and sulphur oxides are considerably reduced. Moreover, FAME has a greater cetane rating and lubricity than normal diesel, which enhances engine durability and performance. The FAME market for fuel application is anticipated to increase over the course of the forecast period as a result of rising demand for clean, sustainable energy sources and stricter emission laws.

Over the projected period, the lubricant application of fatty acid methyl ester is anticipated to record the quickest revenue Growth. In a number of industries, including the automotive, aviation, marine, and others, FAME is employed as a biolubricant. In comparison to traditional petroleum-based lubricants, biolubricants provide a number of benefits, including biodegradability, non-toxicity, and minimal environmental effect. Due to their improved oxidative and thermal resilience, FAME-based lubricants are especially well suited for use in high-temperature applications. The FAME market for lubricant application is anticipated to expand as a result of rising environmental awareness and rising demand for biodegradable and sustainable lubricants.

Throughout the projection period, Fatty Acid Methyl Ester coating application is also anticipated to have substantial expansion. As a result of its superior solvent characteristics, low VOC emissions, and biodegradability, FAME is employed as a raw material for the creation of numerous coatings and resins. Because of their better adhesion, flexibility, and durability, FAME-based coatings are frequently utilized in the construction, automotive, and packaging industries. The FAME market for coating application is anticipated to increase as a result of rising consumer demand for environmentally friendly and sustainable coatings as well as the expanding construction and automotive industries.

Throughout the projection period, fatty acid methyl ester utilization in food and beverages is anticipated to expand moderately. Due to its emulsifying, foaming, and gelling qualities, FAME is utilized as a food additive and ingredient. Food products with FAME-based ingredients are especially well-liked in the Asia Pacific region, where they are included into regional specialties and snacks. The FAME market for food and beverage application is anticipated to increase as a result of the rising demand for healthy and natural food components and the expanding food and beverage sector.

FAME is also used in a number of other sectors, including the pharmaceutical and personal care industries. Over the anticipated period, the FAME market for various applications is anticipated to increase as a result of rising consumer awareness regarding environmental preservation and rising demand for sustainable and eco-friendly products.

Regional Outlook:

In terms of revenue, the Asia Pacific region dominated the Fatty Acid Methyl Ester (FAME) market in 2022. The rising demand for FAME in developing nations like China and India, where environmental restrictions are being enforced more aggressively, is primarily responsible for the region's market growth. Due to FAME's lower carbon footprint and the government's emphasis on lowering greenhouse gas emissions, its use in the production of biodiesel is growing. Moreover, the region's expanding middle class and expanding transportation industry are driving up demand for biofuels, which in turn is propelling the expansion of the FAME market.

Throughout the forecast period, North America is anticipated to see the quickest revenue Growth. The implementation of many energy efficiency policies and the growing awareness of climate change are driving up the demand for biodiesel in the area. In order to lower their carbon footprint, the automotive industry is also embracing biofuels quickly. This is anticipated to fuel the FAME market's expansion in North America. Furthermore, it is anticipated that the region's demand for FAME would be fueled by the expanding trend of adopting eco-friendly products.

Over the forecast period, the Europe market is anticipated to expand moderately. The FAME market is expanding as a result of the region's prominence as a biodiesel producer. The rigorous environmental rules that promote the use of renewable fuels in the transportation industry are the key factors driving the demand for FAME. The demand for FAME as a food additive is also being fueled by the expansion of the food and beverage sector in the area. The region's FAME market is anticipated to increase as a result of the European Union's effort on lowering greenhouse gas emissions.

The market for FAME is anticipated to increase significantly in South America as a result of the growing use of biodiesel in the transportation industry. The FAME market is expanding as a result of the region's ample supply of raw materials like soybean and palm oil. Governments in a number of the region's nations have put laws in place to encourage the use of biofuels, which is anticipated to further the market for FAME.

Over the projection period, the market in the Middle East and Africa is anticipated to rise steadily. The FAME market is expanding as a result of the region's increased emphasis on sustainable development and lowering its reliance on fossil fuels. The region's expanding transportation industry and the introduction of policies to encourage the use of biofuels are the key factors driving demand for FAME. Furthermore, the region's FAME market is anticipated to increase as a result of the ample supply of raw materials like vegetable and animal fats.

Competitive Landscape:

Some major companies included in the global fatty acid methyl ester market report are:

• BASF SE
• Cargill, Inc.
• ADM
• Croda International PLC
• Kao Corporation
• P&G Chemicals
• Emery Oleochemicals Group
• Stepan Company
• Wilmar International Limited
• KLK Oleo
• Jakarta Biofuels Center

Strategic Developments:

• In 2021, BASF SE acquired the surfactant business of Solvay SA. The acquisition was valued at €1.3 billion and aimed to strengthen BASF's position in the surfactants market, including the FAME market, and to expand its global presence.
• In 2020, Cargill, Inc. announced its plans to build a new FAME production facility in Germany. The new plant is expected to produce up to 60,000 metric tons of FAME per year and will help Cargill, Inc. to meet the increasing demand for biofuels in Europe.
• In 2020, Kao Corporation announced its plans to acquire the cosmetic ingredients business of Croda International PLC. The acquisition was valued at £132 million and aimed to strengthen Kao's position in the personal care ingredients market, including FAME derivatives.
• In 2019, P&G Chemicals announced its plans to expand its FAME production capacity in the United States. The expansion was aimed at meeting the growing demand for FAME-based surfactants in the personal care and household cleaning markets.

New Product Launches:

• BASF SE: In 2021, BASF SE launched a new range of FAME-based surfactants called the Lutropur series. These surfactants are designed for use in a variety of applications, including personal care, home care, and industrial cleaning products. The Lutropur series offers high solubility, low foam, and excellent emulsifying properties.
• Cargill, Inc.: In 2020, Cargill, Inc. launched a new line of FAME-based biodiesel called the ClearSky brand. This biofuel is designed to meet the strict environmental regulations of the European Union and offers high performance and low emissions.
• ADM: In 2020, ADM launched a new line of FAME-based lubricants called the OptiLube series. These lubricants are designed for use in a variety of applications, including automotive, marine, and industrial equipment. The OptiLube series offers excellent lubrication and wear protection properties, as well as biodegradability and low toxicity.
• Croda International PLC: In 2019, Croda International PLC launched a new range of FAME-based emollients called the ECO Range. These emollients are designed for use in personal care and cosmetic products and offer a sustainable and environmentally friendly alternative to traditional emollients.
• Emery Oleochemicals Group: In 2019, Emery Oleochemicals Group launched a new line of FAME-based polyols called the Bio-PU series. These polyols are designed for use in the production of Polyurethane foams and offer excellent performance and environmental sustainability. The Bio-PU series offers a renewable and biodegradable alternative to traditional petroleum-based polyols.

Segments Covered in Report

For the purpose of this report, the global fatty acid methyl ester market has been segmented based on type, application, and region.