Europe’s fuel ethanol sector was a slow starter. It took almost 10 years to grow production from 60 million litres in 1993 to 525 million litres in 2004. In the following two years we saw a true explosion in production. In 2005 and 2006 there were double-digit growth levels of over 70%. After a moderate growth in 2007, when production increased by 13% compared to the previous year, figures reached another spike in 2008. Last year, total EU bioethanol production significantly increased by 56%, from 1.8 billion in 2007 to 2.8 billion in 2008.

Compared to the U.S.A. and Brazil, but also to the European biodiesel sector, the EU fuel alcohol sector is rather small. The USA nowadays produces every month more than the EU produce in a year. Moreover, the EU biofuel market is still predominantly a biodiesel market (80%).

Global Ethanol Production for Fuel (2007)

The top 4 EU producers of ethanol are France, Germany, Spain and Poland, followed by Sweden and the UK. The top 6 consumers are France, Germany, Sweden, the UK, Poland and the Netherlands. 2008 was also a record year in terms of imports. Total imports of bioethanol (fuel and non-fuel) are estimated to have reached 1.9 billion litres in 2008, increasing by 400 million compared to 2007. Thereof, between 1.4 and 1.5 billion litres came from Brazil only. Approximately 50% of total imports have been used for the fuel sector (approximately 1.1 billion litres). This equals 39% of total EU production.

The EU production capacity is steadily increasing. At present, the installed capacity amounts to 6.1 billion litres, while production capacity under construction is 2.4 billion litres.

In 2008 the preferred raw material was grain and, more in particular, wheat and maize. The second most important ethanol feedstock after grain is sugar beet juice and a smaller share is produced from raw alcohol. In 2008 we also saw an increasing volume of fuel ethanol being produced from other feedstock such as wood pulp, whey and food waste.

Raw material used for bioethanol (2008)

If we look at the bigger picture of grain use in the EU it becomes immediately clear that bioethanol production is only a marginal consumer of grain. Almost 69% of Europe’s cereals go to the animal feed sector whereas approximately only 2% of all cereals is destined for the bioethanol. Of this extremely small share about one third goes back to the animal feed sector as a high protein animal feed called DDGS. This by-product replaces imported soya meal.

Cereal end-use in the EU (Harvest 2008/09 - estimate)