Published by TMR Research Insights
Posted on October 11, 2021
5 min readLast updated: January 29, 2026
The global ethanol market is set to grow at a 7.9% CAGR from 2017 to 2022, driven by demand in the automobile sector and North America's leading role.
The global ethanol market is characterized by the prominent presence of companies such as Solvay Group, Flint Hill Resources, LP, POET, LLC, Valero Energy Corporation, The Andersons, Inc., Green Plains, Inc., Pacific Ethanol, Inc., Mitsubishi Chemical Corporation, Cargill, Incorporated, and Archer-Daniels-Midland Company, finds Transparency Market Research (TMR). Players strive to tap on vast lucrative opportunities arising out of the burgeoning demand from several end-use industries, notably automobile and alcoholic beverages. Several manufacturers are focusing on technology advancements in production technologies to thrive.
The global market for ethanol stood at US$71.8 bn in 2017 and is anticipated to garner a revenue US$105.0 bn by end of the forecast period of 2017–2022. The global market is projected to rise at a CAGR of 7.9% during the period.
According to the type of feedstock used, the key segments are coarse grain-based, sugarcane-based, and wheat-based ethanol. Of these, coarse grain-based ethanol is projected to emerge as the most attractive segment, rising at a healthy CAGR of 8.0% during 2017–2022. Of note, during the period, the absolute prospect created by this segment could supersede all other types of feedstock.
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Regionally, North America is anticipated to account for the major revenue share of the global market. The regional market is projected to clock a CAGR of 8.1% during the assessment period and is expected to touch a valuation of US$48.3 billion by 2022 end. Europe is a prominent regional market for ethanol and is forecast to generate a revenue of US$3.4 billion, in absolute terms, in between 2017 and 2025.
Demand for Cleaner and Cost-Effective Fuel in Automobile Sector to Bolster Uptake
The ethanol market is driven primarily by the extensive demand for the chemical compound in the automobile sector. The use of ethanol as a clean-burning fuel and as a fuel additive is instrumental in reducing greenhouse gas emissions and reducing dependence on oil in various economies world over. The staggering rise in automobiles in a number of industrialized nation is providing a robust thrust to the adoption of ethanol as an eco-friendly fuel in the automobile sector.
The ethanol market is as also garnered huge gains from the rising number of gasoline stations in advanced nations, particularly the U.S., providing blended ethanol. The growing number of ethanol biorefineries in developed regions is also catalyzing the growth of the market. Ethanol is deemed to be safer and eco-friendly option than most hydrocarbon octane sources, thereby accounting for its vast popularity in the automobile sector.
The emerging popularity of alcoholic beverages is also stoking the demand for ethanol. The rising application of ethanol in making premium quality alcoholic beverages is boosting the market. The miscellaneous use of ethanol in making explosives, paints, and perfume is also accentuating the global market.
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Prevailing Regulations in Some Nations may hinder Growth
The prominent use of ethanol in making a variety of personal care products and household cleaning products is also boosting the market. The market also benefits from the popular use of ethanol as a key ingredient in sanitizers as it can wipe out microorganisms.
However, the highly flammable nature of ethanol elevates the cost of its transportation, which negatively impacts the growth of the market. The unfavorable regulatory landscape in a number of developed nations regulating its end-use applications may also hinder the growth of the market. Nevertheless, the rising popularity of ethanol as biofuels in supporting a low-carbon economy is expected to create lucrative prospects in the years to come. Furthermore, the rise in production of ethanol in supporting the economic growth of several countries is a key factor working in favor of the ethanol market.
The study presented here is based on a report by Transparency Market Research (TMR) titled “Ethanol Market (Feedstock – Coarse grain-based, Sugarcane-based, and Wheat-based; End Use – Fuel, Industrial Solvents, Beverages, and Cosmetics) – Global Industry Analysis, Size, Share, Growth, Trends and Forecast 2017–2022”
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The article discusses the growth and key players in the global ethanol market from 2017 to 2022.
The demand for ethanol in the automobile sector as a clean fuel is a primary growth driver.
North America is anticipated to account for the major revenue share of the global ethanol market.
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