Food Grade Alcohol Market Report 2026

The food grade alcohol market size has grown strongly in recent years. It will grow from $6.67 billion in 2025 to $7.01 billion in 2026 at a compound annual growth rate (CAGR) of 5.2%. The growth in the historic period can be attributed to expansion of spirits and beverage production, rising use of alcohol-based food extracts, growth of pharmaceutical manufacturing, availability of agricultural feedstocks, advancements in distillation technologies.

The food grade alcohol market size is expected to see strong growth in the next few years. It will grow to $8.64 billion in 2030 at a compound annual growth rate (CAGR) of 5.4%. The growth in the forecast period can be attributed to increasing demand for clean-label solvents, rising pharmaceutical and cosmetic consumption, expansion of bioethanol applications, growing focus on sustainable alcohol production, increasing regulatory emphasis on quality standards. Major trends in the forecast period include increasing demand for bio-based and fermentation-derived alcohol, rising use of food-grade alcohol in extracts and flavors, growing adoption of sustainable distillation processes, expansion of pharmaceutical and cosmetic applications, enhanced focus on purity and traceability.

The rising consumption of alcoholic beverages is driving the growth of the food-grade alcohol market. Alcoholic beverages contain varying levels of alcohol by volume, and many are produced using food-grade or neutral alcohol derived from cereals, grapes, molasses, potatoes, and other agricultural products. For example, gin is made from neutral-grain alcohol infused with herbs and spices. In August 2025, according to the National Institute on Alcohol Abuse and Alcoholism (NIAAA), a US-based part of the National Institutes of Health (NIH), 85% of people aged 21 and older reported consuming alcohol at some point in their lifetime. Therefore, increasing alcohol consumption is boosting demand for food-grade alcohol.

Key companies in the market are investing in advanced production methods, such as high-quality grain-based ethanol, to replace traditional lower-purity sources. High-quality solutions enhance purity, improve efficiency, and support sustainable manufacturing by optimizing feedstock use and reducing waste. For instance, in January 2024, Associated Alcohols and Breweries Limited (AABL), an India-based alcohol manufacturer, commenced commercial ethanol production at its new grain-based distillery in Barwaha, Madhya Pradesh. The 130 KLPD plant uses multiple grain feedstocks to produce Extra Neutral Alcohol (ENA) of superior quality for food, beverage, and related applications. This facility strengthens AABL’s position in the premium alcohol segment, supports sustainable production, ensures consistent product quality, and enhances supply reliability to meet growing demand from food and beverage industries.

In December 2024, Allied Blenders & Distillers Ltd., an India-based alcoholic beverage manufacturer, acquired Minakshi Agro Industries LLP for ₹240 crore (approximately US$28-30 million). This acquisition strengthens Allied Blenders’ backward-integration capabilities by securing a consistent in-house supply of grain-based ENA, enhancing production efficiency, and reducing reliance on external suppliers. Minakshi Agro Industries LLP specializes in producing grain-based alcohol used in beverage-grade spirits and Indian-made foreign liquor (IMFL).

Major companies operating in the food grade alcohol market are MGP Ingredients Inc., Cargill Incorporated, Archer Daniels Midland Co., Cristalco SAS, Grain Processing Corporation, Wilmar International Ltd., Malindra Group, MOLINDO Group, Extractohol, Pure Alcohol Solutions, Ethimex Ltd., Roquette Freres SA, Glacial Grain Spirits LLC, Ingredion Inc., Ethanolsa Pty Ltd., Bartow Ethanol of Florida L.C., Greenfield Global Inc., Bartlett Grain Company, United Ethanol LLC, Pacific Ethanol Inc., Green Plains Inc., The Andersons Inc., White Energy, Big River Resources LLC, Southwest Iowa Renewable Energy LLC, Marquis Energy LLC, ICM Inc.

Asia-Pacific was the largest region in the food grade alcohol market share in 2025. The regions covered in the food grade alcohol market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East and Africa. The countries covered in the food grade alcohol market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Italy, Spain, Canada.

The food-grade alcohol market consists of sales of food-grade alcohol opted from grapes, potatoes. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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