China’s renewable fuels have broad prospects and fierce market competition

There are many types of renewable fuel products, including biodiesel, fuel ethanol, synthetic gasoline, etc., which are used to replace traditional fossil fuels. Among them, biodiesel and fuel ethanol are the two most mature products for renewable fuel applications. Renewable fuel is a “green energy” with good environmental protection performance, good fuel performance, wide source of raw materials, renewable and other characteristics, and can be used in many fields such as automobiles and ships.

The fuel ethanol production method is mainly biomass fermentation, using biomass as raw material. The industrial process is divided into five steps: raw material collection, pretreatment, saccharification, fermentation and separation and purification. Biodiesel production methods can be divided into physical, biological and chemical methods. Physical methods include direct mixing and microemulsion methods; biological methods are mainly enzyme-catalyzed transesterification methods; chemical methods include high-temperature pyrolysis, supercritical methods and chemical catalytic transesterification methods. At this stage, downstream users have relatively low awareness of renewable fuels. Taking biodiesel as an example, biodiesel is more expensive than other domestic diesel raw materials, making it difficult to market and promote, and its use is relatively limited.

In recent years, in order to cope with climate change and promote energy transformation, it has become the consensus of major countries around the world. Countries in Europe, North America, Asia, Oceania and other regions have successively introduced green and low-carbon development strategies. In this context, renewable fuels have developed rapidly. According to the “2023-2027 Renewable Fuel Industry In-depth Market Research and Investment Strategy Suggestions Report released by the Industrial Research Center, in 2022 China’s renewable fuel output reached 140 million tons per year.

Renewable fuels are alternatives to traditional fossil fuels. There are many types of products, including fuel ethanol, biodiesel, etc. Domestic renewable fuel production companies mostly focus on a single product, and there is still a lack of production companies that can cover all categories of renewable fuels. Overall, at this stage, there are a large number of manufacturing companies in my country’s renewable fuel industry, which are widely distributed in East China, North China, Central South, Northeast and Southwest China. The market share of a single company is not high, and the market concentration is low. In recent years, the number of companies in the domestic renewable fuel industry has continued to increase, but product homogeneity is obvious and market competition continues to intensify.

Industry analysts said that my country is a relatively poor country in petroleum energy, and its per capita share is very low. With the continuous development of our country’s economy, energy consumption has also increased year by year. However, due to the lack of oil and gas resources in my country and the lack of domestic mining technology, domestic energy production is far from meeting consumer demand, which provides a broad development space for my country’s renewable fuel industry. The renewable fuel industry relies heavily on renewable resources, so investors need to selectively invest in suitable areas based on their own business structures. For example, fuel ethanol mainly uses corn stalks, wheat stalks and other agricultural and forestry waste as raw materials. Investment companies can give priority to major agricultural provinces such as Henan, Hubei, Hebei and Shandong to make full use of local agricultural resources.