Vietnam to Restart Idle Ethanol Plants to Meet Rising Demand

Vietnam is accelerating its shift to E10 RON95 biofuel, but a growing gap between ethanol demand and domestic production is emerging as a key challenge, according to Vietnamnet Global.

Rising Ethanol Demand for E10 Biofuel

At a conference on March 26, the Ministry of Industry and Trade discussed implementing the Prime Minister’s directive on expanding E10 fuel use. Industry estimates indicate that monthly ethanol demand for blending could reach 92,000–100,000 cubic metres.

Domestic Production Shortfall

Do Van Tuan, Chairman of the Vietnam Biofuels Association, said the country’s six ethanol plants have a combined design capacity of 41,000 cubic metres per month, but only three plants are currently operational, producing around 25,000 cubic metres.

Even at full capacity, domestic production would meet just 41% of the required demand, leaving a significant shortfall that must be filled through increased production and imports.

Plans to Maximise Production

Producers at the meeting indicated that several plants could expand or resume operations if financial support and assured demand are provided.

Key Plant Updates

• Dong Nai Ethanol Plant: Currently producing 7,000 cubic metres per month; potential to raise output to 130% of capacity due to flexibility in feedstocks, including corn, cassava, and broken rice.
• Dung Quat Ethanol Plant: Produces 6,000 cubic metres per month; can increase to 9,000 cubic metres with favourable conditions, dependent on firm purchase agreements.
• Binh Phuoc Plant: Idle with a capacity of 6,000 cubic metres per month; requires timely financial and policy support to prevent past investments from going to waste.

Reliance on Imports

To address the shortfall, Vietnam will need to maximize production at existing facilities and supplement supply with imports. Expected sources include the US and Brazil, with shipping routes strategically avoiding conflict-hit regions.

Global Competition and Risks

Tuan highlighted potential risks from timing and international competition. As countries like India, the Philippines, Thailand, and China expand biofuel usage, demand pressure on transit hubs such as South Korea and Singapore may increase, affecting supply chains.

Industry Appeal for Support

Ethanol producers urged the authorities, including the central bank, to introduce financial support measures to revive idle capacity. Such measures are seen as crucial to ensure that investments in the biofuel sector are not wasted and to meet the growing demand for E10 fuel in Vietnam.