Fuel Ethanol Market - Global Industry Analysis

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Fuel ethanol or ethyl alcohol is a compound produced by the process of fermentation of biological materials like corn, sugarcane, wheat, wood, and barley. Mostly, starch based crops and corn are used for the production of ethanol. The most common raw materials used for the production of ethanol are cellulosic materials, starches, and sugar rich feedstock. Ethanol blends well with most of the organic solvents and also with water. Fuel ethanol is a very important part of several industries as ethanol acts a great solvent for many substances. Ethanol is widely used as an automobile fuel.  Fuel ethanol requires less fossil fuel inputs as compared to gasoline refining. For the production of 20 barrels of fuel ethanol it takes only one barrel of crude oil and hence, fuel ethanol is considered a cleaner fuel alternative. It is used in several countries as an additive for gasoline. The legal mixing for ethanol and gasoline in Brazil is 25% and 75% respectively. The global demand for fuel ethanol is anticipated to experience substantial growth over the forecast period especially in the automobile industry owing to its advantages like low cost and eco-friendly nature.

The growth drivers of the global fuel ethanol market are a rapid rise in crude oil prices, rise in green house gas emissions and encouragement from the government through incentives for the production of ethanol. An enormous growth in the automobile sector is likely to boost the growth of the global fuel ethanol market over the coming years. Moreover, the automotive industry has initiated the development of vehicles with engines based on fuel ethanol. Also, the rise in growth of fuel ethanol application in the aviation industry, to improve the fuel efficiency & lower the ecological dangers, is anticipated to enhance the global fuel ethanol market demand over the forecast period. However, the major hindering factor in the global fuel ethanol market is the quantity of agricultural products required to create an amount of ethanol. Rapid growth in the automobile sector and development of vehicles with fuel ethanol based engines is likely to serve as an opportunity for the global fuel ethanol market over the forecast period.

The global market for fuel ethanol is segmented on the basis of applications and region. According to the application, it is divided into pharmaceutical, alcoholic beverages, automotive, chemical feedstock and others. Of all sectors, the automotive sector is experiencing the highest growth in consumption of fuel ethanol. On the basis of the region, the global market for fuel ethanol is divided into North America, Europe, Asia Pacific, Latin America and Middle East & Africa. North America was the leading regional market for fuel ethanol, in terms of its production as well as consumption in the region. Owing to strict rules applied by regulatory agencies to use ethanol as a preservative to automobile fuel, the global fuel ethanol market experienced a huge growth in North America in the last few years. Canada & United State are the major markets for ethanol in the North America region.

The key players in the global market for fuel ethanol are Stake Technology, The Andersons Inc., Advanced Bioenergy LLC., Mascoma Corp., Alternative Energy Sources Inc., Panda Energy International, Blue Fire Ethanol Inc., British Petroleum, DuPont, Pure Energy Inc., Pacific Ethanol, VeraSun Renewable Energy Corp., Range Fuels, NewGen Technologies Inc., Archer Daniels Midland Company, Cargill Corp., Xethanol Corp. and Aventine Renewable Energy Inc, among others.