Industrial Alcohol Market Size and Share Analysis: Regional Perspectives and Market Segmentation

Industrial Alcohol Market Size and Share Analysis: Regional Perspectives and Market Segmentation

Industrial alcohol, also known as denatured alcohol or denatured ethanol, refers to ethanol that is rendered undrinkable by adding toxic or unpleasant chemicals. It is commonly used as fuel for heaters, stoves and fireplaces. Industrial alcohol finds wide applications in the production of fuels, solvents, disinfectants and more. The rising demand for biofuels provides a huge opportunity for industrial alcohol manufacturers. Ethanol is a popular biofuel used to reduce dependency on fossil fuels. Blending ethanol into gasoline reduces emissions and improves air quality.

The global Industrial Alcohol Market is estimated to be valued at US$ 180.75 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 Opportunity:

The growing concern towards environmental pollution and climate change has pushed several governments to promote the usage of green fuels. Many countries have mandated fuel blending targets requiring a certain percentage of gasoline and diesel to be replaced by biofuels annually. Ethanol derived from sugarcane and corn is one of the most widely used biofuels globally. Strong policy support for biofuels development is expected to drive the demand for industrial alcohol substantially in the coming years. Countries are offering incentives and subsidies to industrial alcohol manufacturers to increase ethanol production capacity. This presents a huge opportunity for industrial alcohol producers to cater to the rising needs of fuel companies and expand their production facilities for green fuels. Investments in advanced technologies to produce cellulosic ethanol from agricultural residues and wood will further augment the industrial alcohol market growth over the next decade.

Porter's Analysis

Threat of new entrants: The threat of new entrants in the industrial alcohol market is moderate. High capital requirements and established distribution channels are some barriers for new players.

Bargaining power of buyers: Buyers have moderate bargaining power due to availability of substitutes. Buyers can negotiate on price and purchase in bulk.

Bargaining power of suppliers: Suppliers have moderate power as raw materials like molasses, corn and other sources are widely available. Suppliers can exercise their power in terms of pricing and quality standards.

Threat of new substitutes: Threat from substitutes is moderate as industrial alcohol has diverse applications in chemicals, personal care and pharmaceuticals which are difficult to substitute.

Competitive rivalry: Competition in the market is high owing to presence of global players. Players compete on pricing, product innovation and expanding applications.

SWOT Analysis

Strengths: Industrial alcohol has wide applications in various end use industries. It is cost effective to produce and has substitutes over conventional fuels.

Weaknesses: Heavy dependency on agricultural commodities prices volatility. Stringent regulations regarding production and quality standards.

Opportunities: Growing personal care and chemical industry boosts demand. Alternate production sources like cellulosic help reduce raw material dependency.

Threats: Rising crude oil prices and development of biofuels pose threat. Vulnerable to climate change impacting agri commodity prices.

Key Takeaways

The global industrial alcohol market is expected to witness high growth during the forecast period of 2023-2030. The market size for 2024 is estimated to be US$ 180.75 Bn registering a CAGR of around 10%. Growth will be driven by expanding end use industries and focus on sustainable fuels.

Regional analysis - North America dominates the global industrial alcohol market currently owing to high demand from chemical industry in the US. Asia Pacific is expected to be the fastest growing market during the forecast period led by China, India and other Southeast Asian countries. Growing pharmaceutical sector and manufacturing activities support market expansion in the region.

Key players - 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. Players focus on capacity expansion, new product launches and partnerships to strengthen market presence.