The global ethanol market is estimated to increase at a CAGR of 1.77% from a market size of USD38.826 billion in 2019 to achieve a market size of USD43.136 billion by the end of 2025.
Ethanol, also known as ethyl alcohol or grain alcohol is a clear, colorless 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 contribute to reducing carbon emissions. Ethanol is either produced naturally or through synthetic mode. It is naturally produced from corn grain, sugarcane, or from cellulosic feedstocks like woodchips or crop residues. For household applications, ethanol is used for varied cleaning applications. For maintaining safety and discourage drinking of pure ethanol from the household cleaning products, a bitter flavored, denaturant is added. This makes the product unfit for consumption, while the properties of other substances remain the same. As ethanol is highly flammable, it is recommended to not use the products close to open flames. Additionally, ethanol inhalation has the capability to cause coughing, headaches as per the CDC. The product gained recognition as Generally Recognized as Safe, GRAS for use in food products. This is due to the fact that 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.
The current novel coronavirus pandemic situation led to a decline in ethanol production, causing a decline in market as well. The supply chain disruptions of the raw material, workforce shortages, forced shutting down of manufacturing plants, and travel bans have put an impact on 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 a steady growth till the end of the forecast period. 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 an increasing production of hand sanitizers. Hence, ethanol producers round the globe are geared to fulfill this high demand, further providing an opportunity for the market growth between late 2020 and by the end of 2025.
On the basis of 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 manufactures 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 is continuing to increase from 2013 to 2019.
The USA and Brazil are estimated to produce over 80% of the total global ethanol. 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 is augmenting the market growth during the forecast period.
A collaboration between Attis Industries Inc and Novozymes was announced in 2019 for the production of renewable fuel. Novozymes is geared to offer enzymes that are required by Attis for conversion, sugar out of pulp in all the planned biorefineries. Novozymes contain a broad product portfolio of biotechnology for supporting the commercial biofuels production, in addition, there is a capability to increase the 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 through the utilization of 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 for the manufacturing of cellulosic ethanol, thus, helping in contributing to the growing market for cellulosic biofuels. This, is in accordance with 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 for the production of sustainable biofuels and chemical commodities. Praj industries, based in India aims for scaling, integration, and optimization of 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 that are based on agricultural residues. To combat climate change issues, the two companies are geared for production of sustainable biofuels, biochemicals, and materials. The partnership is further focused on the enhancing the production of bioethanol at the global level.
The collaboration between ADM and Dupont Industrial Biosciences, a subsidiary of DowDuPont was announced on 2018 for the development, production, and marketing of cellulase enzymes for grain-based ethanol plant operators. The enzymes help in hydrolyzing corn fiber for fiber breakdown, further 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 renewable identification number.
In 2020, a strategic partnership was announced among the Clariant’s Business Line Biofuels and Derivatives and Chemtex Global Corporation for second generation biofuel projects. The two parties collaborated for 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 in the world; 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 is poised to provide an extensive package of 2G ethanol technology licenses and EPC services. Thus, enabling consumers in China for successful designing, building, and operation of their own full-scale plants. Clariant will be offering its technology licenses and technical services along with starter cultures from its proprietary enzyme and yeast platform. Chemtex, on the other hand, will be providing EPC services.
Recent product launches by companies for ethanol production or launch of ethanol products are further providing an impetus in surging the market growth during the forecast period.
It was announced in 2019 that Phibro animal health Corp’s ethanol performance group expanded their customer solutions portfolio by releasing the novel yeast products for addressing the needs of the evolving market. The yeast products are launched for ethanol production, realizing the important 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 that include fermentation, infection management, and animal feed co-products. The product portfolio includes cleaning aids, corn oil recovery, processing aids and now the company announced the proprietary yeast products, namely phibroADY and fortiphi. These represent the state-of-the-art product offerings. PhibroADY has the capacity to 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 fermentations for the production of ethanol. The product consists of premium organic and inorganic compounds that are selected for assisting in improving the fermentability of standard grain mashes. Furthermore, the inclusion of inactivated yeast culture, vitamins, and essential minerals help in providing a balanced supplement for supporting the 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 the 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 latest yeast product for utilizing carbon-efficient pathway leading to an increased growth of around 3%, in comparison to the conventional yeasts.
The other product, Distillase DXT is an advanced glucoamylase blend, the new member of the Distillase line. The product is developed for the providing help to consumers for 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 that 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 that increases liquefaction. It is an addition to the popular Optimash range.