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October 2025
The U.S. biodiesel market size accounted for USD 15.34 billion in 2024 and is predicted to increase from USD 16.08 billion in 2025 to approximately USD 24.63 billion by 2034, expanding at a CAGR of 4.85% from 2025 to 2034. Global shift towards sustainable and cleaner fuels has driven investor confidence in the industry’s future.
The U.S. biodiesel industry refers to the domestic industry involved in the production, distribution, and use of biodiesel as an alternative fuel. Biodiesel is a renewable, biodegradable fuel derived primarily from vegetable oils, animal fats, and waste cooking oils, which can be blended with conventional diesel (B5, B20, B100) for transportation and industrial applications.
The market is driven by environmental regulations, renewable fuel standards (RFS), demand for low-emission fuels, rising adoption in transportation and heavy-duty sectors, and incentives promoting biofuel production and consumption. It is blended and offers long-lasting fragrances, as per the recent industry observation.
| Report Attributes | Details |
| Market Size in 2025 | USD 16.08 Billion |
| Expected Size by 2034 | USD 24.63 Billion |
| Growth Rate from 2025 to 2034 | CAGR 4.85% |
| Base Year of Estimation | 2024 |
| Forecast Period | 2025 - 2034 |
| Segment Covered | By Feedstock Type, By Product / Fuel Type, By Production Technology, By End-User |
| Key Companies Profiled | Pacific Biodiesel Technologies, Neste Corporation (U.S. operations) , Bunge Limited , Green Plains Inc. , World Energy , Valero Energy Corporation , Pacific Ethanol, Inc. , Tyson Foods, Inc. (animal fat feedstock partnerships) , Sustainable Oils, LLC |
The market has observed the under-technology integration while maintaining expense and using traditional refineries in recent years. Moreover, several manufacturers are investing in advanced technology, which is likely to drive the industry growth in the coming year. Also, initiatives like co-processing in existing refineries and usage for domestic feedstock are contributing to the industry's potential in recent years.
The United States has exported a heavy amount of biodiesel in 2024, which is estimated as 176.8 million gallons.(Source: www.fastmarkets.com)
| Country / Region | Regulatory Body | Key Regulations | Focus Areas | Notable Notes |
| United States | Environmental Protection Agency (EPA) | Renewable Fuel Standard (RFS) | Blended volumes and Greenhouse gas (GHG) reductions | The EPA is the central federal agency regulating biodiesel production and other fuels in the United States. |
How did the Soybean Oil Segment Dominate the U.S. Biodiesel Market in 2024?
The soybean oil segment held approximately 40% share of the market in 2024, due to its wide availability and cost-effectiveness. Furthermore, the United States is considered one of the leading soybean producers, which has contributed to the segment's growth in recent years. Moreover, factors like a stronger domestic chain and compatibility with existing biodiesel technology, the soybean oil segment, have gained major industry share in recent years, as per the recent survey.
The waste cooking oil /yellow grease segment is expected to grow at a notable rate during the predicted timeframe, owing to the ongoing sustainability shift and circular economy models. Furthermore, these feedstocks have been seen in lower carbon intensity than regular crop-based feedstock, which is likely to create lucrative opportunities in the coming years.
Why does the B20 Segment Dominate the U.S. Biodiesel Market by Fuel Type?
The B20 segment held approximately 50% of the Market in 2024 because it provides the best balance of performance, cost, and ease. It works seamlessly in existing engines without modifications, making it a practical choice for fleets and drivers. B20 also delivers strong environmental benefits by reducing emissions without the supply chain challenges of pure biodiesel. Fuel stations and distributors prefer B20 because infrastructure adjustments are minimal.
The B100 / renewable diesel segment is expected to grow at a notable rate during the forecast period, because of the push for deeper decarbonization. Unlike blends, pure biodiesel and renewable diesel deliver near-total replacement for petroleum diesel. Renewable diesel is chemically identical to petroleum diesel, which means it can be used in existing infrastructure with zero modification.
How Did The Transesterification Segment Dominate The U.S. Biodiesel Market In 2024?
The transesterification segment dominated the market with approximately 60% share in 2024, because it is simple, proven, and cost-effective. This process chemically transforms oils and fats into biodiesel using alcohol and a catalyst, making it ideal for soybean oil and other traditional feedstocks. U.S. producers favored transesterification because of its efficiency and ability to scale quickly. It became the backbone of early biodiesel production plants, ensuring consistent quality and output.
The hydroprocessing/HEFA segment is expected to grow at a significant rate during the forecast period, because it produces renewable diesel with higher quality and broader applications. Unlike transesterification biodiesel, HEFA-based renewable diesel is chemically like petroleum diesel, making it a fully "drop-in" fuel for engines, pipelines, and refineries. This technology is also better suited for scaling up large refineries, many of which are being converted into renewable fuel plants.
Why does the Commercial Transport Fleets Segment Dominate the U.S. Biodiesel Market?
The commercial transport fleets segment held 50% of the Market in 2024 because they are high-volume fuel consumers and need cost-effective ways to reduce emissions. Trucking companies, logistics providers, and shipping fleets embraced biodiesel because it offered immediate carbon reductions without costly engine replacements.
The government / municipal fleets segment is expected to grow at a notable rate during the forecast period, because of strict public sector sustainability mandates. Cities, states, and federal agencies are under pressure to decarbonize their vehicle operations, including buses, police cars, and public works vehicles. Unlike private fleets, governments are driven not just by cost but also by policy commitments and climate pledges.
By Feedstock Type
By Product / Fuel Type
By Production Technology
By End-User
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October 2025
October 2025
October 2025
October 2025
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