Alcohol that is can be used for consumption is known as food grade alcohol. These are the principal type of alcohols that are used in alcoholic beverages. They are usually flammable, volatile, and colorless in nature with a distinct odor. They occur naturally and are also produced by fermentation and hydrogenation of sugar either by yeast or by petrochemical process. This type of alcohol is consumed in food & beverages and also for medicinal purposes. The global market for food grade alcohol is segregated on the basis of type, source, function and application. Based on type, the market is divided into polyols and ethanol. Polyols are sugar alcohol that has a low calorie content as compared to sugar and is therefore, used as artificial sweeteners. They are also added to chewing gums as they do no break down by bacteria and therefore helps prevent tooth decay. Common types of polyols include erythritol, xylitol, sorbitol, maltitol and various others. Ethanol also known as drinking alcohol is primarily used in alcoholic beverages. It is an addictive drug and can cause neurotoxicity if consumed in sufficient quantities. Most common uses of ethanol include fuel, solvent and feedstock among others. Ethanol held the major market share in 2016 and is anticipated to witness a similar trend during the forecast period from 2017 to 2025, owing to its wide range of uses in alcoholic beverages and application in pharmaceutical and food industry. On the basis of source, the global market for food grade alcohol is segregated into fruits, grains, sugarcane & molasses and others. Sugarcane & molasses held the majority market share in 2016 due to abundant availability of sugarcane from which sucrose is derived and is fermented into alcohol. In addition, low cost of production is another major reason that is fuelling the demand for sugarcane & molasses. Based on function, the global market for food grade alcohol is segregated into coatings, preservative, coloring/flavoring and others. Coloring/flavoring held the majority market share in 2016 and is anticipated to witness similar trend during the forecast period. Based on application the global food grade application is segregated into pharmaceuticals, food and beverages. Beverages are further segregated into spirits, beer, wine and others. Beverage held the majority market share in 2016 and is anticipated to witness a similar trend during the forecast period. This is attributed huge demand for alcoholic beverages among consumers across all age groups and across all countries.
Increasing demand for craft & draught beer globally and increased beer production is a major factor driving the global market for food grade alcohol. In addition, rising demand for food grade alcohol as preservatives is also stimulating the growth of the market. Rising awareness about the harmful effects of alcohol when consumed in larger quantities is one of the key factors barring the growth of the market at present. Stringent government regulations regarding the usage of alcohol in food and pharmaceutical products is another reason that is hindering the overall market growth. Usage of co-products of ethanol in the feed industry offers great opportunity tfor the growth of the global food grade alcohol market.
Geographically, the global market for food grade alcohol market is segregated into North America, Europe, Asia Pacific, Middle East & Africa and Latin America. In 2016, the majority market share was held by North America and is it is projected to maintain a stable growth rate during the forecast period. Asia Pacific is forecasted to have the most rapid growth rate during the forecast period due to increased demand for craft beer in the region.
Major players of the global food grade alcohol include Cargill, Inc., Archer Daniels Midland Company, Roquette Frères, Sigma-Aldrich, Grain Processing Corporation, Cristalco S.A.S, MGP Ingredients, Wilmar International Limited, Manildra Group and Fonterra Co-Operative Group among others.
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