Industrial Ethanol Market Intelligence

Industry Outlook & Drivers

Industrial Ethanol Global Market Outlook

The global industrial ethanol market is set to grow at a CAGR of 2 percent over the next five years

•  Non-fuel ethanol accounts for approximately 20 billion litres of the total ethanol production. In other words, 15-20 percent of the total ethanol consumption is for non-fuel applications such as chemicals, plastics, pharmaceutical and beverage industries, including cosmetics, cleaning products, paints and alcoholic drinks
•  Key regions driving growth: Growth in Asia, Brazil and Europe will be driven by the demand from the solvents and chemical intermediates sector

Industrial Ethanol Demand Market Outlook

The global non-fuel ethanol market is balanced in mature markets like the US and Europe, having sufficient supply; while demand is marginally higher in the emerging markets like China and Brazil

•  Brazil is looking to leverage on the existing capacities and reducing exports, while China is dependent on imports from other Asian markets

Industrial Ethanol Global Market Production 

Non-fuel ethanol (or ethyl alcohol) is used in the manufacturing process for a wide range of products in industries across chemicals, plastics, pharmaceutical and beverage industries, including cosmetics, cleaning products, paints and alcoholic drinks. Its use in applications other than fuel blending accounts for approx. 5.4 billion gallons (20 billion litres) of ethanol.

Industrial Ethanol Global Supply-Demand Analysis

Demand and production is expected to grow in tandem and the market is expected to remain balanced with a very narrow supply-demand gap

• Asia is the center for industrial ethanol market, as it is the largest producer as well as consumer of industrial grade ethanol, accounting for slightly over 50 percent of the market
• Europe, with its large base of pharmaceutical, personal care and food & beverage industries, is the second largest consuming region for industrial grade ethanol, accounting for more than 2.5 billion litres
  

Market Outlook 

• Between 2014 and 2021, non-fuel ethanol demand is expected to continue growing at the rate of 2 percent, driven by growth in demand from the Asian region, which is the biggest consumer of industrial ethanol
• Recent capacity additions in Europe, which is a major consumer (importer) of non-fuel ethanol, will bring down its dependency on other exporting markets such as South America and Asia (Pakistan)

Industrial Ethanol Global Demand by Application 

• Globally, solvents occupy the lion's share of the industrial ethanol demand market, at 63 percent, and is expected to grow at a CAGR of 3 percent . Chemical intermediates, which account for 37 percent of the global demand share, is expected to grow at a slightly higher growth rate of 3.5 percent over the next three years
• Applications pertaining to CPG & FBT markets have a significant share in the total demand market: Personal care (15 percent), cleaning products (10 percent) and food & beverage (10 percent). Hence, growth in these sectors significantly impact the ethanol demand market