by Industrial alcohol, also known as denatured alcohol or methylated spirits, is an ethanol product rendered undrinkable through the addition of additives like methanol. It finds extensive usage in personal care and household cleaning products like perfumes, aftershaves, lotions, disinfectants, soaps and surface disinfectants due to key attributes like evaporation, sterilizing ability and cost-efficiency. The global industrial alcohol market is gaining traction due to rising requirements in personal care sector attributed to growing preference for naturally formulated personal care products. With heightened awareness regarding hygiene amidst the ongoing pandemic, demand for surface disinfectant sprays and wipes containing industrial alcohol is witnessing a spike.
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 key trends:
One of the major trends in the industrial alcohol market is growing adoption for production of ethanol fuel or biofuel. Ethanol is blended with gasoline to manufacture gasohol, which is being promoted as a cleaner alternative to conventional gasoline fuel. Governments across regions like Europe and North America are offering incentives and tax credits for production and usage of ethanol blended fuel to reduce dependence on fossil fuels. Moreover, with depleting crude oil reserves and fluctuating prices, focus on development of renewable fuel sources is increasing. This is anticipated to drive the need for industrial alcohol in fuel production procedures over the coming years. Another trend gaining significance is rising consumption of industrial alcohol in pharmaceutical formulations. It is widely used as an antiseptic in medicines, mouthwashes and hand sanitizers due to germ killing properties. In wake of COVID-19, pharmaceutical grade ethanol demand registered a spike for manufacturing hand rubs and disinfectants.
Porter’s Analysis
- Threat of new entrants: The threat of new entrants is moderate. New entrants require large capital investment for production facility, distribution network, and brand recognition. Regulations also create barriers for new players.
- Bargaining power of buyers: The bargaining power of buyers is moderate to high. Buyers have alternatives and can switch between suppliers as industrial alcohol has substitutes. Buyers prefer reliable suppliers and competitive pricing.
- Bargaining power of suppliers: The bargaining power of suppliers is moderate as suppliers have access to raw material. However, suppliers have less influence as raw material sources can be substituted.
- Threat of new substitutes: The threat of new substitutes is moderate to high as products like biofuels and other sustainable chemicals pose threats. Technology advancements may lead to newer substitutes.
- Competitive rivalry: Competitive rivalry is high as the market is consolidated and competition intense between major players. Companies differentiate through innovation, product quality, and distribution reach.
Key Takeaways
The global industrial alcohol market is expected to witness high growth over the forecast period driven by increasing demand from end use industries. 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.
Regional analysis: North America is expected to dominate the industrial alcohol market during the forecast period. Large presence of end use industries like fuel, pharmaceuticals favors market growth in the region. Asia Pacific is expected to grow at fastest pace led by China and India owing to increasing manufacturing activities and rising disposable income.
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. Companies are focusing on expanding production capacities and developing innovative products to gain higher market share.
