# Biodiesel (FAME): Overview

From B7 to B40: how blend mandates create the market

Source page: https://www.materialinsights.org/energy/biodiesel/overview/

What this tab covers What the chemical is, how big its market is, what it is used for (with shares, volumes, why it wins and what could replace it), and its chain from raw material to end user. Ends with three things to remember.

Biodiesel is fatty acid methyl ester (FAME): oils and fats reacted with about 10% methanol, giving about 10% glycerine as a by-product. The world makes about 45-50 Mt a year (2024-25, indicative), with Indonesia (palm, B40; B50 postponed in January 2026), the EU (rapeseed and used cooking oil) and Brazil (soy, B15) the largest. Most engines limit it to 7-20% blends, and renewable diesel (HVO) is taking its growth. India makes only about 0.6 billion litres, under 1% of diesel. Waste oils save over 80% against diesel; palm from cleared land can be worse than fossil.
 Volume about 45-50 Mt a year of FAME (2024-25, indicative, basis: UFOP biodiesel plus HVO of about 65 Mt in 2024 less about 15-18 Mt HVO) Market value about $60-70 billion a year (indicative, basis: 47 Mt x about $1,390/t, the average 2024 export unit value of HS 382600 in UN Comtrade) Growth flat to slightly rising: Brazil's rising blend adds volume and Indonesia's B50 would add more, but it was postponed in January 2026 with B40 kept, while US and EU growth goes to HVO (US FAME plants ran at 58% in 2025) UFOP 2026; UN Comtrade 2024 HS 382600 (derived); farmdoc daily Jun 2026

#### Key uses

| Use | Share | Annual volume | Why this commodity | Alternatives |
|---|---|---|---|---|
| **Road diesel blends (B7 EU, B15 Brazil, B20 US, B40 Indonesia)** | 90% | about 42 Mtbasis | FAME is the cheapest renewable diesel substitute and works in existing engines at low blends. Mandates set almost all demand; Indonesia alone used 12.7 Mt under B40 in 2025 (palm_oil tile). palm_oil tile; share indicative | Renewable diesel (HVO) Electric and gas trucks CNG/CBG |
| **Marine bunker blends (B24-B30) and inland shipping** | 4% | about 1.9 Mtbasis | Rotterdam and Singapore sell FAME-blended bunker fuel to meet FuelEU Maritime and charterer targets; UCOME is preferred for its low carbon intensity. indicative | Bio-methanol and e-methanol LNG/bio-LNG HVO |
| **Heating oil and off-road (bioheat, generators, rail)** | 3% | about 1.4 Mtbasis | US north-eastern states mandate bioheat blends; mines, rail and bulk users in India can buy B100 directly. indicative | Heat pumps HVO |
| **Chemicals: methyl ester sulphonates, solvents, lubricants, fatty alcohol feed** | 3% | about 1.4 Mtbasis | Methyl esters are intermediates for detergents (MES), fatty alcohols by hydrogenation and biodegradable solvents. surfactants tile; share indicative | Petroleum solvents LAB-based surfactants |

 No published global split; shares are indicative on a 47 Mt base.

#### From raw material to user

1. **Oil and fat supply** Palm oil (Indonesia, Malaysia), soybean oil (Americas), rapeseed oil (EU, 33% of EU FAME and HVO feedstock in 2025, EBB), used cooking oil (16.5% in the EU), tallow and fatty acid distillates.
2. **Pre-treatment** Degumming, drying and acid esterification of free fatty acids for waste oils; virgin oils need less.
3. **Transesterification** About 1 t oil plus 0.1 t methanol with sodium methoxide catalyst gives about 1 t FAME and 0.1 t crude glycerine (indicative).
4. **Washing and distillation** Methanol is recovered, FAME is washed or distilled to meet EN 14214 or ASTM D6751.
5. **Blending and distribution** Blended into diesel at terminals; EU blenders consumed about 12.2 Mt FAME in 2025 (EBB).

#### Made from (commodity table)
[PO Palm oil](https://www.materialinsights.org/commodities/palm_oil/)[Soy Soybeans](https://www.materialinsights.org/commodities/soybeans/)[Rs Rapeseed](https://www.materialinsights.org/commodities/rapeseed/)

#### Three things to know

- Indonesia used 12.7 Mt of palm biodiesel in 2025, about 16% of world palm oil use, and B50, postponed in January 2026, could lift it to 16.3-17 Mt (palm_oil tile, GAPKI; Investortrust, 14 Jan 2026).
- EU default values put used cooking oil biodiesel at 84% and palm biodiesel from open-pond mills at only 20% below diesel's 94 g CO2e/MJ (RED II Annex V).
- India produced about 556 million litres of biodiesel in 2025 from about 2 billion litres of capacity, under 1% of diesel (USDA FAS, Jul 2026).

#### Read the tabs
[Production route](https://www.materialinsights.org/energy/biodiesel/routes/)[Production](https://www.materialinsights.org/energy/biodiesel/production/)[Feedstocks](https://www.materialinsights.org/energy/biodiesel/feedstocks/)[Cycles](https://www.materialinsights.org/energy/biodiesel/cycles/)[Trading](https://www.materialinsights.org/energy/biodiesel/trading/)[Movement](https://www.materialinsights.org/energy/biodiesel/movement/)[Regulation](https://www.materialinsights.org/energy/biodiesel/regulation/)[Characteristics](https://www.materialinsights.org/energy/biodiesel/characteristics/)[Emissions](https://www.materialinsights.org/energy/biodiesel/emissions/)

## Other sections

- [Summary](https://www.materialinsights.org/energy/biodiesel/index.md)
- [Energy overview](https://www.materialinsights.org/energy/biodiesel/energy/index.md)
- [Correlation](https://www.materialinsights.org/energy/biodiesel/correlation/index.md)
- [Efficiency](https://www.materialinsights.org/energy/biodiesel/efficiency/index.md)
- [Techniques](https://www.materialinsights.org/energy/biodiesel/techniques/index.md)
- [Resources and labour](https://www.materialinsights.org/energy/biodiesel/resources/index.md)
- [Impact on the biosphere](https://www.materialinsights.org/energy/biodiesel/biosphere/index.md)
- [Production route](https://www.materialinsights.org/energy/biodiesel/routes/index.md)
- [Production](https://www.materialinsights.org/energy/biodiesel/production/index.md)
- [Feedstocks](https://www.materialinsights.org/energy/biodiesel/feedstocks/index.md)
- [Cycles](https://www.materialinsights.org/energy/biodiesel/cycles/index.md)
- [Trading](https://www.materialinsights.org/energy/biodiesel/trading/index.md)
- [Movement](https://www.materialinsights.org/energy/biodiesel/movement/index.md)
- [Regulation](https://www.materialinsights.org/energy/biodiesel/regulation/index.md)
- [Characteristics](https://www.materialinsights.org/energy/biodiesel/characteristics/index.md)
- [Emissions](https://www.materialinsights.org/energy/biodiesel/emissions/index.md)
- [Relationships](https://www.materialinsights.org/energy/biodiesel/links/index.md)