Argentina expects record ethanol production in 2026

Argentina’s fuel ethanol production could reach a record 1.35 billion liters in 2026, driven by rising domestic consumption and expanded corn processing capacity, according to a forecast by USDA’s Foreign Agricultural Service (FAS).

Around 60% of ethanol output will be corn-based, with the remainder produced from sugar. The industry received an additional boost from a regulation introduced in March allowing fuel distributors to voluntarily increase ethanol blending to 15%, above the mandatory 12% rate.

Growth in corn ethanol production is being supported by Argentina’s record 2025/26 corn crop and additional production capacity. Around 3% of the country’s total corn output is expected to be used for bioethanol production in 2026. Argentina currently has 12 corn-based ethanol plants, although one operates almost exclusively for industrial ethanol.

Biodiesel production is also forecast to increase by 8% to 1.2 billion liters. At the same time, exports could fall to their lowest level since 2007, declining by around 26% from 2025. Despite higher production, Argentina’s biodiesel plants are expected to operate at only about 27% of installed capacity.

Further growth in the sector will depend on changes in government policy. Argentina is considering legislation that would raise the mandatory ethanol blending rate to 15% and the biodiesel mandate to 10%. According to FAS, higher blending requirements, together with the development of SAF and other advanced biofuels, could boost domestic feedstock consumption and encourage new investment in the sector.