Vietnamese conglomerate to invest nearly 2,000 billion VND in ethanol production as the $100 billion ethanol market looms

From June 1, 2026, lead-free gasoline blended into E10 for use in gasoline engines nationwide will be required under the Ministry of Industry and Trade’s Circular 50, using ethanol as the key biofuel component.

The shift is intended to reduce carbon emissions by replacing part of fossil fuels and supporting a plan to cut traditional gasoline consumption by about 10%, with net-zero emissions targeted by 2050.

Ethanol demand outpaces domestic supply

Domestic demand for ethanol used in biofuel blending is currently high, while domestic production capacity meets only about 40% of requirements, leaving the remainder dependent on imports.

MarketsandMarkets estimates the global bioethanol market at $83.4 billion in 2023, projected to reach $114.7 billion by 2028, growing at a CAGR of 6.6% from 2023 to 2028.

QNS moves to expand ethanol output

To capitalize on the market outlook, at its 2026 annual general meeting, Quang Ngai Sugar Joint Stock Company (QNS) said it is implementing an Ethanol project with a designed capacity of 200,000 liters per day. The project has been approved by the board of directors, and the company is completing legal procedures to seek investment approval.

At an investment promotion conference in Gia Lai province in 2026, QNS received a memorandum of investment cooperation for the An Khê Ethanol Plant project, and international tender documents were issued to select an implementation partner. The company described this as the largest investment project it has undertaken to date, with total approved investment of more than VND 1,740 billion.

Under the plan, the plant is expected to produce about 30% food-grade ethanol and 70% fuel ethanol for blending gasoline. With domestic gasoline consumption estimated at around 25 million tons per year and the E10 transition advancing, management views the ethanol fuel market potential as very large.

The company said investing in the project will also help secure molasses and by-products from sugar production and increase operational flexibility, allowing adjustments between sugar and ethanol output depending on market conditions.

QNS expects the project to be completed and put into operation from the start of 2028.

2026 outlook: cautious targets amid industry pressure

QNS management assessed that 2026 will still present challenges, including slow recovery in purchasing power, cautious consumer sentiment, volatile production costs, and intense competition.

Within the sugar industry, the company cited pressure from falling sugar prices, high inventories, smuggling and trade fraud, and rising imports of liquid sugar and HFCS. In fast-moving consumer goods, it noted narrowed margins and higher demand for product innovation.

Company targets and dividend plan

Against this backdrop, QNS plans for 2026 with a cautious approach, targeting revenue of VND 10,500 billion and after-tax profit of VND 1,512 billion, down about 5% and 21% respectively from the previous year. Management said this would be the lowest profit level for the company since 2022. The dividend payout is expected to remain at least 15%.

For 2025, the AGM approved the remaining cash dividend payout of 20%, equivalent to VND 2,000 per share. The closing date to finalize the shareholder list is 17/04/2026, and the payment date is expected on 28/04/2026.