Food Grade Alcohol Market Size is Growing at a CAGR of 5.4% and Reach $8.8 Billion by 2027

Rise in consumer spending & growth in urbanization have led to an increase in the consumption of processed & comfort food which, in turn, has driven the growth.

WILMINGTON, DE, UNITED STATES, August 4, 2025 /EINPresswire.com/ -- Food grade alcohol market size was estimated at $6.97 billion in 2019, and is expected to hit $8.84 billion by 2027, registering a CAGR of 5.4% from 2021 to 2027.

Increase in consumption of alcoholic beverages among consumers worldwide and rise in acceptance of alcoholic beverages in social gatherings, especially in Asia-Pacific, are expected to propel the demand for food grade ethanol. In addition, growth in adoption of low-calorie and sugar-free food products, owing to the rise in consumer health consciousness is one of the crucial factors that drive the growth of the global food grade alcohol industry.

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The production and consumption of alcoholic beverages globally are expanding. The trend of consuming alcoholic beverages, such as beer, wine, whiskey, among others, in social gatherings has propelled the market growth. This has been a crucial factor to drive the market for ethanol, which, in turns, fuels the market growth. In addition, the application of polyols (sugar alcohols) in the pharmaceutical & nutraceutical industry has risen exponentially. The rise in consumption of nutraceutical among consumers in the form of functional foods, dietary supplements, and functional beverages fuels the food grade alcohol market growth. This is attributed to the fact that polyols are used in numerous pharmaceutical and nutraceutical products, owing to their coating, sweetening, emollient, bulking, anti-crystallizing, and stabilizing properties. However, fluctuations in prices of sugarcane, corn, wheat, and others are expected to hinder the food grade alcohol market growth.

The market is expected to exhibit an incremental revenue opportunity of $1.8 billion from 2021 to 2027. Furthermore, rise in demand for alcoholic beverages as well as low-calorie food propel the market growth. Moreover, rise in demand for sugar substitutes or alternatives due to consumer preferences shifting toward a healthier lifestyle is expected to drive the growth of the global food grade alcohol market size.

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At the onset of the COVID-19 outbreak, the demand for the food industry has been significant. The demand, especially for pharmaceutical and nutraceutical products has benefited consumers who want to live a healthier life by improving their dietary habit. Therefore, the demand for polyols (sugar alcohol) has gained higher traction. Consumers have developed an increasing preference for food products manufactured with no or less sugar to ensure a healthy diet and prevent diseases such as obesity, diabetes, and others.

Based on geography, North America generated the highest share in 2019, garnering more than one-third of the global food grade alcohol market. This is attributed to tremendous popularity and substantial consumption of alcohol and processed food in the region Simultaneously, Asia-Pacific would register the fastest CAGR of 6.6% by the end of 2027, owing to rapid demand and acceptance of alcohol for social drinking coupled with rise in expenditure of young consumers.

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The key players profiled in this report include Cargill Incorporated, Cargill Incorporated, Archer Daniels Midland Company, Archer Daniels Midland Company, Ingredion, Manildra Group, MGP Ingredients, Inc., Molindo Group.

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