Biochar Market Size, Share & COVID-19 Impact Analysis, By Technology (Pyrolysis and Gasification), By Application (Farming, Livestock, Power Generation, and Others) and Regional Forecasts, 2023-2030

The global biochar market size was valued at USD 184.90 million in 2022. The market growth is projected to grow from USD 204.69 million in 2023 to USD 450.58 million by 2030, exhibiting a CAGR of 11.9% during the forecast period.

Biochar is a charcoal-like material produced from plant materials such as grass and agricultural and forest residues that decompose at high temperatures, often during renewable energy production. During the process, the physical and chemical properties of the plant material change into a highly porous, stable, carbon-rich material. Pyrolysis is widely known as the manufacturing process of producing charcoal from wood. Gasification is a basic process in which organic carbonaceous materials are converted into carbon monoxide and carbon dioxide at high temperatures with oxygen and steam.

COVID-19 IMPACT

COVID-19 Pandemic Caused a Decrease in Demand Due to a Fall in Investment in Upcoming Plants

The sudden outbreak of COVID-19 across the globe led to the termination of all normal daily activities like going to work, gathering, meetings, and commuting between countries even stepping a foot outside the house.

However, the suggestions of this pandemic crisis have affected many industries in diverse ways, such as the halt of domestic industrial procedures, decreased production, disruptions in value chains, raw material shortage, no international transactions, imports and export stopped, unreachability of new orders and clients, lack of operating staffs, and many others things.

COVID-19 has expressively impacted the production plant market due to supply chain disruption and a fall in investment in this technology of upcoming plants in the European Union. The overall energy demand has broadly decreased in this region due to the pandemic, as most industries and commercial sectors were closed.

LATEST TRENDS

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Supportive Government Policies for Environment Protection to Boost Market Growth

Carbon emissions have increased considerably in recent years due to rapid industrialization, leading to climate change. High population growth across the globe, flourishing industrial sector, and growth in infrastructure development activities led to a huge rise in electricity demand.

Production of biochar involves heating organic matter without oxygen in pyrolysis. It can be carried out in a small household stove, or it can be an industrial operation. Either way, pyrolysis doesn't produce carbon dioxide like ordinary, oxygen-fueled fire. Furthermore, the production is promising because it captures the CO2 absorbed by plants and, by baking it down into a charcoal-like substance added to soil to increase fertility. Therefore, the improved food production capacity can reduce the requirement to clear more land for the purpose of agriculture, and more efficient cookstoves could reduce the gathering of wood from already shrinking forests.

Governments across the globe are striving to lower the impact of climate change by enhancing renewable technology penetration. Several global tax incentives programs, such as state sales tax exemption, state income tax credit, corporate income tax deduction, and local property tax exemption, are offered by governments to encourage renewable adoption. Additionally, many federal-level incentives are available to businesses, nonprofit organizations, and municipal projects. These include a modified accelerated cost recovery system (MACRS), tax incentives for subsidies, and business tax incentives. Government schemes, such as Renewable Heat Incentive (RHI), have generated substantial interest in developing countries markets. Such schemes are expected to drive the market soon.

DRIVING FACTORS

Environment Related Concerns are Likely to Fuel the Market

Biochar is mainly produced from the waste materials of biomass, which is suitable for production, including crop residues such as field and processing residues, food and forest waste, and animal manure. Abundant agricultural, municipal, and forest biomass are burned, due to which a large amount of CO2 and methane is released, which pollute surface and local ground water.  

If solid waste is not treated properly, it could negatively impact the environment as the global accumulation of agricultural waste is around 2 billion tons in a year, whereas forest waste accounts for about 0.2 billion tons, municipal waste for about 1.7 billion tons, and industrial waste for 9.1 billion tons. The usage of biomass-related solutions globally is increasing, owing to the increasing prices of primary fuel for energy production. The global demand for biochar as a fuel is increasing significantly due to the high industrial and commercial demand. Moreover, the easy availability of biomass sources and low production cost has led to its higher consumption in the industrial sector.

Growing Demand for Climate Smart Agriculture to Increase Soil Fertility will Propel the Market

The product is manufactured from the residue of biomass, sawdust, and agricultural waste materials. Therefore, this is the solid product remaining after biomass is heated to temperatures typically known as pyrolysis. The biomass suffers from its high moisture content and low energy density, leading to major issues like high transport costs and poor grinding ability. The product produced from biomass pyrolysis can be a better fuel than biomass, addressing the key issues associated with direct biomass utilization.

According to World Bank data, three of the biggest challenges of the twenty-first century are the need to nearly double food production by 2050, to adapt and build resilience to a more challenging climatic environment, and simultaneously achieve a substantial reduction in atmospheric greenhouse gas concentrations. The rising interest in climate-friendly agriculture focused on solutions to a few challenges has sparked curiosity about using biomass to combat climate change while improving soil fertility. Moreover, it is relevant for developing nations and could address global challenges related to climate change.

RESTRAINING FACTORS

Lack of Knowledge Concerning the Manufacturing Process of Products to Hamper Market Growth

Biomass is used as the feedstock in the pyrolysis reactor, which has a set heating and gas flow rate, residence duration, and temperature. Following that, the biomass-residue product can be created. There are certain by-products of this process, such as gas and bio-oil. However, when the product is applied to agricultural land, several prior research identified the following drawbacks: loss of land due to erosion, soil compaction during the application, risk of contamination, removal of crop residues, and reduction in worm life rates; these factors are creating a negative impact on the environment and could affect the market.

Biomass is used as the feedstock that has a specified heating and gas flow rate, residence time, and temperature. Further, the negative impact of the product, such as the loss of land due to erosion, soil compaction during the application, risk of contamination, removal of crop residues, and reduction in worm life rates could affect the market.

Lack of knowledge of the sustainable char manufacturing process will continue to be one of the major constraints limiting this product's development and potential consumption. The lack of effective technology for low-emission char synthesis, particularly for distant or mobile production, has hampered the market value. The high cost of such products and underlying structural constraints, such as a shortage of finance for producers, an immature carbon market, and shorter timescales for mining land restoration bonds, continue to impede the biochar market growth. While the commercialization of this product is still in its early stages, this hard-to-sell product's lack of consistency and standardization impedes market expansion.

SEGMENTATION

By Technology Analysis

Pyrolysis Segment Holds the Dominant Market Share Owing to its Inexpensive and Convenient Aspects

Based on the technology, the market has been bifurcated into gasification & pyrolysis. Pyrolysis is likely to dominate the market owing to its widely preferred technology because it is inexpensive, convenient, and can handle various feedstocks. This technology helps to avoid greenhouse gas emissions. This drives the growth in the Pyrolysis Technology segment over the forecast period.

The gasification segment is expected to show significant growth during the forecast period. This technology produces smaller quantities of such char in a directly heated, air-introduced reaction vessel. Market demand and acceptance of this technology are increasing as it produces lower levels of air pollutants. However, this method is slightly less efficient than others.

By Application Analysis

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Agriculture Segment Holds the Dominant Share due to its Extensive Use in Agriculture for Fertilizer

Based on application, this market is segmented into Agriculture, Livestock, Power Generation, and Others. The agricultural segment is likely to dominate the market. Such charcoal is used extensively in agriculture for fertilizer as it helps to increase the natural rates of carbon in the soil and improves the quality of the soil. It also helps reduce agricultural waste and lowers greenhouse gas emissions from the soil. Farmers worldwide are increasingly using such char, driving the growth in the agriculture segment during the forecast period.

The power generation segment is expected to grow significantly over the forecast period. Governments in different parts of the world have encouraged the generation of energy from such coal as it reduces carbon emissions from different sectors like agriculture, forestry, etc.

REGIONAL ANALYSIS

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Asia Pacific held the dominant share of the global market. The potential importance of the region for soil improvement and carbon sequestration is the main driver behind this sector. In addition, the region's tremendous economic and agricultural development has contributed to the market expansion. In the Asia Pacific region, China is the leading producer of such char. The region addresses crop residue disposal, soil pollution, quality degradation, slash-and-burn, and greenhouse gas emissions. As a result, agricultural waste into this product and the use of this product as a soil conditioner in farmland is driving growth in this region to overcome these problems.

According to Nature Communication, the widespread application of zero-emission technologies (NETs) is essential to achieve CO2 reduction and renewable energy goals to meet the Paris Agreement goals of cost-effectively reducing global temperature rise to 2°C or possibly limiting 1.5 °C. Reductions in total GHG emissions could reach up to 8620 MtCO2eq by 2050 if a “moderate” scenario calls for charcoal processing 73 percent of crop residues with BIPP in the short term (2020-2030) and then coordinating deployment with BECCS will be beyond 2030.

North America is the second largest market for char in the world and is expected to expand significantly due to increasing demand for organic food and high meat consumption. The sector's growth has been supported by many local and large manufacturers operating on a national and global basis. According to USBI, the domestic char production represented by the survey participants ranges from 35,000 to 70,000 tons annually.           

KEY INDUSTRY PLAYERS

Key Participants are focusing on enhancing their Product Capacities to Gain a Competitive Edge

The market for biochar is highly fragmented, with the presence of numerous players. Chardust Ltd, Aries Clean Energy, Airex Energy, and Farm2Energy are the leading players with a strong presence across different countries. Their operational plants' success will help them acquire contracts and gain a market share in the coming years. In June 2021, Airex Energy and SUEZ Group partnered to provide solutions to regions and industries on their path toward carbon neutrality. The two groups' expertise will enable them to industrialize the recovery of biomass residues into biochar (a stable form of organic carbon), essential to urban and agricultural soil resilience, vitality, and fertility.

The other key industrial wood pellet market players are Oregon Biochar Solutions, Carboni GMBH, Chargrow, Charline, and SAFI ORGANICS. The competition among top players in the market is very high as they are targeting to expand across regions. The one with unique offerings in technology, portfolio, design, efficiency, and more will capture the maximum end-user attention.

LIST OF KEY COMPANIES PROFILED: 

• Airex Energy (Canada)


• Carbonis GmbH & Co. KG (Germany)


• Farm2Energy (India)


• Oregon Biochar Solutions (U.S.)


• CharGrow LLC (U.S.)


• Chardust Ltd (Kenya)


• Safi Organics (Kenya)


• Charline Gmbh (Austria)


• Cookswell Jikos (Kenya)


• Aries Clean Energy (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• November 2021 - Vale announced an investment of 60-70 million Chinese yuan in China Baowu Steel Group Corp.'s biochar pilot project. Ltd known. The parties committed to working together to develop a steelmaking program that reduces greenhouse gas emissions under the terms of the MoU.


• June 2021 - Wakefield announced that it signed an agreement with Vow ASA to install an industrial-scale Biogreen system in Georgia, USA. It will convert biomass and bioresidue into high-quality biochar, which will address the fast-growing high-quality biochar market.


• June 2021 - SUEZ Group announced that it has merged with Airex Energy to offer solutions to carbon neutrality to different industries. Their expertise will help them to industrialize the recovery of biomass residues into biochar, which is important for the resilience and fertility of agricultural soils.


• April 2021 - Drax announced that it had completed the acquisition of the share capital of Pinnacle Renewable Inc. Pinnacle will operate as a subsidiary of Drax and remain headquartered in British Columbia. Over 480 Pinnacle employees, including its existing leadership, will be welcomed into the Drax Group.


• July 2020 - Enviva acquired all of the limited liability interests in Georgia Biomass Holding LLC for total consideration of USD164.0 million in cash after accounting for certain adjustments.

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The market report provides a detailed analysis of the Biochar market share and focuses on key aspects such as leading companies, types, and system applications. Besides this, the report offers insights into market trends and highlights key industry developments. In addition to the abovementioned factors, the report encompasses several factors that have contributed to the market growth over recent years.

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