Food Grade Alcohol Market To Hit Value .14 Billion By 2027

Posted by Mrudula Anil Karmarkar on January 13th, 2021

The global food grade alcohol market size is expected to reach USD 3.14 billion by 2027, as per a new report by Grand View Research Inc., expanding at a CAGR of 3.8% from 2020 to 2027. The market is expected to be majorly driven by the changing consumer preferences in terms of food and beverage flavors supported by new product development by existing industry participants.

Food grade alcohols are used in the production of industrial and household cleaning chemicals. The recent outbreak of COVID-19 has resulted in a significant increase in the demand for hand sanitizers and surface disinfectants, thereby positively affecting the demand for the product. Various chemical and beverage manufacturing companies have started production of food-grade alcohol-based hand sanitizers and surface disinfectants in order to meet the surging demand. The updated report will account for COVID-19 as a key market contributor.

Growing population, coupled with rising number of people within the upper-middle class, has contributed to the increasing market penetration. The western influence on youth in Asia Pacific countries, such as India, has also contributed to the increased sales of the product from the alcoholic beverage segment. In Europe, the growth is majorly attributed to product innovation that has led to the development of RTD alcoholic beverages, which has played an important role in driving demand in the region.

Demand for flavor enhancing food additives from the food processing industry, coupled with demand from the beverage industry for alcohols and crafted beer, is a key factor boosting the market growth. Furthermore, ascending popularity of anti-aging creams has driven the product consumption from the personal care industry. In addition, COVID-19 pandemic has accelerated the product demand from the healthcare and pharmaceutical sectors for sanitizers, medical equipment, and sanitization applications, which is having a positive impact on the market growth. However, supply chain disruptions owing to lockdown in major countries, such as India and China, are likely to impact the market growth negatively.

Competition for new and innovative product launches is intense amongst the manufacturers. Furthermore, compliance with the national and international regulatory norms is one of the key concerns for the manufacturers. Compliance with these norms for sustainable manufacturing and distribution, along with acquiring certifications, such as USDA and GMP, is one of the major concerns among the manufacturers involved in domestic as well as offshore businesses.

Food Grade Alcohol Market Report Highlights

  • Growing awareness about consumer product ingredients among the customers, coupled with rising demand for new alcohol-based flavors, is expected to be a prime market driver
  • By function, the coloring and flavoring agent segment is expected to witness prominent sales supported by ascending demand for food additives that can enhance the flavor of food extracts
  • Based on application, food and beverages are expected to witness higher demand owing to rising popularity of alcoholic beverages and crafted beers
  • The healthcare and pharmaceutical application segment is expected to witness lucrative growth amid COVID-19 pandemic due to rising product demand for sanitization applications
  • Europe and North America are among the top consumers of food grade alcohol owing to significantly developed pharmaceutical and food and beverage processing industries
  • Strategic alliance with other players in order to increase product penetration and profit margins is likely to be a key strategy among players during the forecast period.

Alcoholic beverages, which were earlier considered a premium offering, are now gradually becoming an essential product that can be found in the majority of households globally. The introduction of new products and rising consumption in emerging economies due to the burgeoning population have helped in the growth of the market.

Growth in volume consumption has benefitted the food grade alcohol industry as it forms an important component of any alcoholic drink worldwide. The changing drinking habits of the millennial population and rising number of craft distilleries have fueled the growth of the alcoholic beverages industry.

Moreover, there have been changes in consumer preferences in terms of food and beverage flavors due to new product development by the existing market participants. This is further anticipated to boost the growth of the market in the forthcoming years.

The outbreak of COVID-19 in December 2020 and its deadly effects on North American, Asia Pacific, and European countries, especially China, Italy, France, Germany, Spain, Iran, and the U.S., are estimated to result in a demand-supply gap, and thus restrain the product demand. However, growth in the pharmaceutical sector, along with the growing need for hand rubs, is estimated to fuel the product demand.

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The market is fragmented with a significant number of market participants operating at the global or domestic levels. The market competition is intense as industry participants are engaged in maintaining a customer base to have a competitive edge over each other. This has resulted in high ethanol production and exports in the market, especially from the players with sugar manufacturing plants.

The players are trying to compete to gain a greater market share by adopting strategies such as mergers & acquisitions and new product launches. Leading players in the market are engaged in directing their growth strategies, thus heading towards the developing countries for augmenting their research capabilities to strengthen their distribution base and enhance their product portfolios. The market is further characterized by a manufacturer’s focus on R&D for product innovation and diversification. Manufacturers are inclined towards continuous investment in process improvement for consistently meeting the growing demand from the food and beverages and pharmaceutical sectors. Some of the prominent players in the food grade alcohol market are:

  •         MGP
  •         Cargill, Incorporated
  •         ADM
  •         Cristalco
  •         Grain Processing Corporation
  •         Manildra Group
  •         Wilmar International Ltd.
  •         Roquette Frères
  •         Extractohol  
  •         Greenfield Global Inc.
  •         Pure Alcohol Solutions
  •         Ethanolsa Pty Ltd.
  •         ILLOVO SUGAR AFRICA (PTY) LTD.
  •         Bartow Ethanol of Florida, L.C
  •         GODAVARI BIOREFINERIES LTD.

About Grand View Research

Grand View Research, Inc. is a U.S. based market research and consulting company, registered in the State of California and headquartered in San Francisco. The company provides syndicated research reports, customized research reports, and consulting services. To help clients make informed business decisions, we offer market intelligence studies ensuring relevant and fact-based research across a range of industries, from technology to chemicals, materials and healthcare.

For More Information:www.grandviewresearch.com

 

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Mrudula Anil Karmarkar

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Mrudula Anil Karmarkar
Joined: July 2nd, 2020
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