Global Ethanol Market - Forecasts from 2022 to 2027

The global ethanol market is estimated to increase at a CAGR of 3.97% from a market size of US$ 33.703 billion in 2020 to achieve a market size of US$44.261 billion by 2027.

Ethanol, also known as ethyl alcohol or grain alcohol, is a clear, colourless liquid used in varied real-life applications. Potential applications include personal care and cosmetics, beverages, solvents, fuel, and many other applications. The market is projected to grow during the forecast period owing to the growing demand for clean fuel that contributes to reducing carbon emissions. Ethanol is either produced naturally or through synthetic mode. It is naturally produced from corn grain, sugarcane, or cellulosic feedstocks like woodchips or crop residues. For household applications, ethanol is used for varied cleaning applications. A bitter-flavoured denaturant is added to maintain safety and discourage the drinking of pure ethanol from household cleaning products. This makes the product unfit for consumption, while the properties of other substances remain the same. As ethanol is highly flammable, it is recommended not to use the products close to open flames. Additionally, ethanol inhalation can cause coughing and headaches, as per the CDC. The product gained recognition as Generally Recognized as Safe, GRAS for use in food products. This is because ethanol is a pure form of alcohol, and its use in food, along with consumption, is regulated by the US Food and Drug Administration and other organizations.

Furthermore, the increasing demand for hand sanitizers is further offering an opportunity for market growth as many hospitals, government organizations, and households are looking forward to increased production of hand sanitizers. Hence, ethanol producers around the globe are geared to fulfil this high demand, further providing an opportunity for market growth between late 2020 and the end of 2025.

Based on geography, the United States from the North American region is predicted to be the largest producer. This is followed by Brazil, the European Union, China, and Canada. In addition, most of the major manufacturers are based in the United States, further bolstering the market growth in the country during the forecast period. According to the U.S. Department of Energy, the global production of ethanol was anticipated to increase from 2013 to 2019.

The USA and Brazil are estimated to produce over 80% of the total global ethanol. The majority of ethanol in the United States is produced from corn; on the other hand, in Brazil, most of the ethanol production is done via sugarcane.

Significant partnerships and collaborations by the companies for expanding ethanol production are augmenting the market growth during the forecast period.

A collaboration between Attis Industries Inc and Novozymes was announced in 2019 to produce renewable fuel. Novozymes is geared to offer enzymes required by Attis for the conversion of sugar out of pulp in all the planned biorefineries. Novozymescontains a broad product portfolio of biotechnology for supporting commercial biofuel production; additionally, there is a capability to increase production as required for supporting Attis' growth plans. The company, Attis, has converted the pulp extracted from the patented biomass processing into high sugar yields by utilizing Novozymes' enzymes. The strategic partnership is further focused on improving the value, yield, and process efficiencies. Also, the sugars utilized for producing the Novozymes enzymes will be used to manufacture cellulosic ethanol, thus, helping contribute to the growing market for cellulosic biofuels. This is by the EPA renewable fuel standard.

A collaborative partnership was announced in 2020 between Sekab E-technology AB and Praj Industries. The organizations signed a partnership agreement to produce sustainable biofuels and chemical commodities. Praj Industries, based in India, aims to scale, integrate, and optimization of the CelluAPP technology platform that is developed by the Sekab. The technology is advanced for coniferous residue conversion into biofuels, bio-based materials, and green chemicals. The company, Praj, is experienced in delivering ethanol plants based on agricultural residues. To combat climate change issues, the two companies are geared toward producing sustainable biofuels, biochemicals, and materials. The partnership is further focused on enhancing bioethanol production at the global level.

The collaboration between ADM and Dupont Industrial Biosciences, a subsidiary of DowDuPont, was announced in 2018 for the development, production, and marketing of cellulase enzymes for grain-based ethanol plant operators. The enzymes help hydrolyze corn fibre for fibre breakdown, allowing more sugars for liberation and fermentation into ethanol. The ethanol produced may qualify for D3 RINS under the Renewable Fuel Standard, where D3 refers to cellulosic ethanol, and RINS is an abbreviation for a renewable identification number.

In 2020, a strategic partnership was announced between Clariant's Business Line Biofuels and Derivatives and Chemtex Global Corporation for second-generation biofuel projects. The two parties collaborated on the marketing and sales of Clariant's sunliquid technology licenses, in addition to the services for advanced biofuel plants located in China. The country is the largest passenger vehicle market globally; hence, the environmental impact has become a challenge for the government of China. The state government in 2017 endorsed a novel strategic plan for utilizing bioethanol generated from agricultural residue for motor vehicles. The joint offerings of the two companies are poised to provide an extensive package of 2G ethanol technology licenses and EPC services. Thus, enabling consumers in China to successful designing, build, and operation of their own full-scale plants

Recent product launches by companies for ethanol production or the launch of ethanol products are further providing an impetus to surging market growth during the forecast period.

It was announced in 2019 that Phibro animal health Corp's ethanol performance group expanded its customer solutions portfolio by releasing novel yeast products to address the needs of the evolving market. The yeast products are launched for ethanol production, realizing the critical role of yeasts in the production of biofuels. The group is a long-time industry pioneer in antimicrobials and offers solutions for various ethanol producers on the basis of its core competencies, which include fermentation, infection management, and animal feed co-products. The product portfolio includes cleaning aids, corn oil recovery, and processing aids, and now the company has announced the proprietary yeast products, namely phibroADY and fortiphi. These represent state-of-the-art product offerings. PhibroADY can perform robustly throughout a wide range of operating conditions. The yeast has an efficient performance characteristic for higher ethanol production. In addition, the yeast has a fast fermentation kinetic and shows higher longevity, staying viable late in fermentation. On the other hand, Fortiphi yeast is a specialized nutritional supplement for industrial yeast. This is particularly designed for grain mash fermentation for the production of ethanol. The product consists of premium organic and inorganic compounds selected to improve the fermentability of standard grain mashes. Furthermore, the inclusion of inactivated yeast culture, vitamins, and essential minerals help provide a balanced supplement for supporting yeast growth and metabolism.

DuPont Industrial Biosciences announced the launch of three next-generation yeasts in 2018 through its innovation hub for the enhancement of yields, speeding up fermentation, and reduction of energy and chemical consumption. The novel products comprise DuPont Synerxia Thrive, next-generation in yeast for the fuel alcohol industry, DuPont Distillase DXT for advanced glucoamylase blend, and DuPont Optimash AX. The three products are game-changers for the ethanol fuel market. Synergia Thrive GX is the advanced version of the company's Synerxia fermentation systems. This helps in offering a novel option in high-yield yeasts for assisting in the development of ethanol. The product is the latest yeast product for utilizing a carbon-efficient pathway leading to increased growth of around 3% compared to conventional yeasts.

The other product, Distillase DXT, is an advanced glucoamylase blend, the new member of the Distillase line. The product is developed the providing help to consumers in extracting more value from the liquefied grains via a combination of advanced glucoamylases, trehalase, and cold cook alpha-amylase. The product is optimized for the complete conversion of starch to sugar, which is poised to increase the yield to around 1% compared to other trehalase-based blends. Also, it is designed to pair with synergia thrive GX.

The third product increases liquefaction. It is an addition to the popular Optimash range.

COVID-19 Impact

The COVID-19 pandemic situation led to a decline in ethanol production, causing a decline in the market as well. The supply chain disruptions of the raw material, workforce shortages, forced shutting down of manufacturing plants, and travel bans have impacted fuel demand, further contributing to impacting the market growth amid the pandemic in 2020. However, post-covid, i.e., after the adoption of the new normal, the market is predicted to experience steady growth till the end of the forecast period.

Segmentation:

• By Grade

95% Ethanol

Absolute (99-100%) Ethanol

Denatured Ethanol

• By Source

Natural

Synthetic

• By Application

Personal Care & Cosmetics

Pharmaceutical

Food and Beverage

Transportation

Energy

Others

• By Geography

North America

• USA
• Canada
• Mexico

South America

• Brazil
• Argentina
• Others

Europe

• UK
• Germany
• France
• Spain
• Others

Middle East and Africa

• UAE
• Saudi Arabia
• Others

Asia Pacific

• Japan
• China
• India
• South Korea
• Malaysia
• Thailand
• Philippines
• Others