Hydrotreated Vegetable Oil Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Feedstock, By End User, By Region & Competition, 2021-2031F

The Global Hydrotreated Vegetable Oil Market is projected to expand from USD 14.61 Billion in 2025 to USD 19.32 Billion by 2031, achieving a CAGR of 4.77%. Hydrotreated Vegetable Oil (HVO) is a paraffinic renewable fuel created through the hydroprocessing of vegetable oils and animal fats, offering a distinct advantage over traditional biodiesel due to its drop-in compatibility with current diesel infrastructure and engines. The market is chiefly driven by strict government decarbonization mandates, such as the European Union's Renewable Energy Directive, which enforce greenhouse gas emission reductions in the heavy transport sector. Additionally, the operational flexibility of HVO, characterized by excellent storage stability and superior cold-flow properties, promotes its adoption as a premium sustainable option for logistics fleets requiring immediate reductions in carbon intensity.

However, the market faces a substantial obstacle regarding the high volatility and limited availability of sustainable feedstock costs, a situation worsened as the aviation sector increasingly competes for residues and waste oils. This scarcity threatens to restrict production scalability even as processing capacity grows. According to the International Energy Agency, global production capacity for sustainable aviation fuel and renewable diesel is expected to rise by 40% in 2025, reaching a total of 800,000 barrels per day.

Market Driver

The Decarbonization of the Heavy-Duty Transportation Sector is significantly influencing the market, acting as a major catalyst for the uptake of hydrotreated vegetable oil (HVO). As industrial fleets and logistics companies encounter mounting pressure to lower their carbon intensity, HVO has become a critical solution due to its chemical resemblance to fossil diesel, allowing for immediate application without costly engine modifications. This transition is further supported by federal incentives and low-carbon fuel programs that encourage high-volume usage in road transport. To illustrate the scale of this demand, the U.S. Energy Information Administration's 'Short-Term Energy Outlook' from December 2024 forecasts that renewable diesel consumption in the United States will average 250,000 barrels per day in 2025.

concurrently, the Rising Demand for Sustainable Aviation Fuel (SAF) is transforming production dynamics and prompting investments in dual-purpose facilities. Since HVO and SAF frequently rely on similar hydroprocessing technologies and feedstocks, the aviation industry's aggressive pursuit of emission reductions is driving refiners to rapidly build capacity capable of flexibly producing both fuels. According to the International Air Transport Association's 'SAF Production Estimates' from December 2024, global SAF production volumes hit 1 million tonnes in 2024, doubling the previous year's total. To support this infrastructure growth, Cepsa announced in February 2024 the initiation of a new second-generation biofuels plant in Spain with a €1.2 billion investment.

Market Challenge

The scarcity and high volatility of sustainable feedstock costs constitute a critical bottleneck impeding the expansion of the Global Hydrotreated Vegetable Oil Market. As producers strive to scale operations to satisfy decarbonization mandates, they face a severe shortage of essential raw materials, specifically animal fats, waste oils, and residues. This deficit is exacerbated by the aviation sector, which is increasingly securing these same finite resources for Sustainable Aviation Fuel production. Consequently, HVO manufacturers deal with unpredictable operating expenses and shrinking profit margins, which undermines investor confidence and prevents the fuel from becoming a cost-competitive alternative for logistics fleets, ultimately stalling production scalability despite rising demand.

According to the European Biodiesel Board, the share of waste-based feedstocks in the region's total biodiesel and HVO production mix reached 55% in 2024, surpassing crop-based inputs for the first time. This statistic underscores the industry's growing reliance on residue streams that are becoming increasingly contested. As competition for these limited resources intensifies, supply chain rigidity forces prices upward, thereby restricting the market's ability to sustain the consistent output levels necessary for widespread global adoption.

Market Trends

The Emergence of Vertical Integration in Feedstock Supply Chains is gaining momentum as producers aim to insulate themselves from raw material price volatility. Instead of relying on third-party aggregators for residues and waste oils, market leaders are increasingly acquiring upstream collection networks to guarantee a stable input flow. This structural shift enables companies to capture margins across the entire value chain and secure scarce waste resources before they reach the open market. Exemplifying this strategy, Biobased Diesel Daily reported in December 2024 that the environmental commodities firm STX Group acquired the waste-based feedstock trader Marine Olie to establish a fully integrated sourcing platform across the Amsterdam-Rotterdam-Antwerp region.

Simultaneously, the Retrofitting of Fossil Fuel Refineries for Co-Processing Capacity is emerging as a cost-efficient alternative to constructing greenfield facilities. By modifying existing hydrocrackers to process renewable lipids alongside petroleum distillates, major oil companies can rapidly introduce lower-carbon fuels into the supply mix without abandoning legacy infrastructure. This approach utilizes established logistics and minimizes capital expenditure while meeting immediate regulatory blending obligations. Highlighting the scale of this transition, BP America reported in May 2024 that its Cherry Point refinery successfully expanded its capabilities to co-process over 7,000 barrels of renewable diesel per day by utilizing existing units to blend biomass-based feedstocks with conventional crude oil.

Key Market Players

• Eni S.p.A.
• St1 Nordic Oy
• Neste Oyj
• Valero Energy Corporation
• PT Pertamina
• Repsol SA
• TotalEnergies SE
• UPM-Kymmene Corporation
• Renewable Energy Group, Inc.
• Green Biofuels Limited

Report Scope

In this report, the Global Hydrotreated Vegetable Oil Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

Hydrotreated Vegetable Oil Market, By Feedstock

• Edible Vegetable Oils
• Crude Palm Oil
• Used Cooking Oil
• Tall Oil
• Animal Fats
• Others

Hydrotreated Vegetable Oil Market, By End User

• Transportation
• Agriculture
• Industrial
• Others

Hydrotreated Vegetable Oil Market, By Region

• North America
  • United States
  • Canada
  • Mexico
• Europe
  • France
  • United Kingdom
  • Italy
  • Germany
  • Spain
• Asia Pacific
  • China
  • India
  • Japan
  • Australia
  • South Korea
• South America
  • Brazil
  • Argentina
  • Colombia
• Middle East & Africa
  • South Africa
  • Saudi Arabia
  • UAE

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the Global Hydrotreated Vegetable Oil Market.

Available Customizations:

Global Hydrotreated Vegetable Oil Market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report:

Company Information

• Detailed analysis and profiling of additional market players (up to five).