Analysts expect a shortage of raw materials in the European biofuel sector in the near future.

The biofuel sector in the EU – one of the largest global markets – may face a raw material shortage due to increased demand and stricter environmental requirements, according to experts at CME Group. The rising demand for renewable raw materials from biofuel producers creates risks of supply disruptions, which, amid the decarbonization process, increases price volatility and reduces margins. According to Argus Media, the consumption of biofuels in the EU will grow by 10% to 30.6 billion liters in 2025 compared to 2024. The latest revision of the Renewable Energy Directive (RED III) sets a target of using 42% renewable energy by 2030. For the transport sector, the target is 29% renewable energy and a reduction in greenhouse gas emissions by 14.5%. Compared to RED II, the overall renewable energy target has been increased from 32% to 42.5%, but the deadline remains unchanged at 2030. Raw material markets are ready for a structural transformation: the expansion of mandatory quotas ...