Industrial Alcohol Market Is Estimated To Witness High Growth
The Industrial alcohol market is estimated to be valued at US$ 199.19 Bn in 2023 and is expected to exhibit a CAGR of 10% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
Industrial alcohol has wide applications in industrial solvents, fuel additives, and manufacturing pharmaceuticals. The products like ethanol, methanol, propanol, butanol are commonly used in the market. Ethanol is widely used as a biofuel and fuel additive across various sectors like automobile, aviation fuel etc. due to its environmental benefits.
Market key trends:
The increasing demand for fuel additives from the automotive industry is a major trend driving the growth of the industrial alcohol market. Ethanol is blended with gasoline to produce gasohol, which is increasingly adopted as fuel across various countries. Gasohol provides various benefits like reduction in greenhouse gas emissions and improved engine performance. According to the Renewable Fuels Association, around 15 billion gallons of ethanol was consumed in the US in 2022 for blending with gasoline. Stringent regulations regarding carbon emissions and rising environmental concerns are further boosting the adoption of ethanol-blended fuels. Additionally, increasing consumption of industrial solvents from end-use industries such as paints & coatings and chemicals is also contributing to the market growth during the forecast period.
Porter’s Analysis
Threat of new entrants: The industrial alcohol market requires large capital investments to enter. Established companies enjoy economies of scale and have access to new technology which poses barriers for new entrants.
Bargaining power of buyers: Buyers have moderate bargaining power due to availability of substitute products. Buyers can negotiate for better prices and demand high quality.
Bargaining power of suppliers: A few major companies control the supply of raw materials like corn, barley and sugarcane. This gives them negotiating power over prices.
Threat of new substitutes: Emergence of biofuels is a threat as they can replace industrial alcohol in applications like fuels.
Competitive rivalry: The presence of established players has led to intense competition.
SWOT Analysis
Strength: Established distribution network and technical expertise gives advantage. Large scale production leads to cost leadership.
Weakness: Fluctuating raw material prices and stringent government regulations increase production costs. Dependence on agriculture increases supply uncertainties.
Opportunity: Increasing use in numerous end-use industries like pharmaceuticals, personal care and chemicals drives demand. Biofuel policies support usage in transportation fuel.
Threats: Changing consumer preferences towards substitutes like biofuels. Economic slowdowns can decrease demand from end-use industries.
Key Takeaways
The Global Industrial Alcohol Market Growth is expected to witness high, exhibiting CAGR of 10% over the forecast period, due to increasing use as biofuel in the transportation sector. The U.S dominated the North America region in 2023 due to presence of leading alcohol producers and growing ethanol production.
Regional analysis- Asia Pacific is expected to grow at the fastest pace during the forecast period owing to rising industrialization, urbanization and disposable income in major economies like China and India.
Key players operating in the industrial alcohol market are BASF SE, BIRLA SUGAR, CARGILL INCORPORATED., CRISTALCO, FLINT HILLS RESOURCES, GREEN PLAINS INC., GREENFIELD SPECIALTY, MGP INGREDIENTS INC., SIGMA ALDRICH, and THE ANDERSONS INC.