Companies in this industry produce ethyl alcohol, known as ethanol, and biodiesel fuel. Major biofuel manufacturers include Abengoa (Spain), Cosan (Brazil), Green Plains (US), Novozymes (Denmark), Poet (US), and Renewable Energy Group (US), as well as units of oil and gas producers such as Chevron and Valero and crop processors such as Archer Daniels Midland and Bunge (all based in the US).
Demand is driven by motor vehicle use and government requirements that ethanol be blended into gasoline. The profitability of biofuel production facilities depends on prices of gasoline and diesel, which fluctuate based on world petroleum demand and domestic refinery use. Economies of scale in ethanol production are limited due to the transportation costs associated with gathering feedstocks (corn and other biomasses) and transporting the ethanol to blending sites. Small companies can compete effectively by developing business relations with distributors and by delivering consistently. The US industry is concentrated: the 50 largest companies generate more than 75% of revenue.