The biofuels market in China that includes bioethanol and biodiesel, is estimated to reach a production capacity of 10 million and 2 million tones by 2020 respectively, according to a report by Market Research. Biofuels has huge growth potential in China. Recently, domestic and foreign players have formed joint ventures to start developing second generation biofuels. The Chinese government is taking initiatives by investing in the development of marginal land on which non-food crops can be grown for the production of biofuels. The demand for clean energy sources along with government’s support will drive the biofuels market in China. The factors contributing to the growth of biofuels market including depleting and dependency on oil reserves, rising automotive sector, degradation of environment, international partnerships and social impact. The key challenges identified include scarcity of land and water, and food security. The government's initiatives have been discussed, indicating subsidies being given to develop the biofuel market. According to another report, the Biofuels Market 2010-2020, by Market Research the global spending in 2010 on biofuels will total $41 billion.