The Salts & Flavors Segment Held a Dominant Position in the Global Alcohol Ingredients Market

Alcohol Ingredients

According to Coherent Market Insights, France recorded the highest per capita consumption of whiskey, accounting for 2.36 liters in 2014. Uruguay was placed second, with a per capita consumption of 1.85 liters, while the U.S. ranked third with 1.32 liters. Furthermore, the South Asian Nations consumed over 1.8 billion liters of whiskey in 2015. These countries are majorly responsible for the high demand for alcohol ingredients. Additionally, rising young adult demographic and rising purchasing power of consumers are major factors boosting the demand for alcoholic beverages, in turn fuelling growth of the alcohol ingredients market.

However, excessive consumption of alcohol has adverse effects on human health such as the development of head and neck cancers irregular heartbeat, increased risk of strokes and liver cell inflammation, which hampering growth of the alcoholic beverages sector, which in turn, is expected to restraint growth of the alcohol ingredients market. According to the World Health Organization (WHO), over 3.6 million deaths occurred each year across the globe, due to excess consumption of alcohol.

Among ingredients type, the salts & flavors segment held a dominant position in the global alcohol ingredients market in 2016. Dominance of this segment is attributed to the extensive use of natural or artificial flavors in alcoholic beverages, including spirits, beers, and wines.

Among beverage type, the distilled spirits segment is expected to record the fastest growth during the forecast period, owing to the rising consumption of distilled spirits worldwide. According to Coherent Market Insights’ analysis, the global distilled spirits market is expected to cross over US$ 37 billion by 2025.

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Alcohol Ingredients Market Outlook

• Europe held a dominant position in the alcohol ingredients market in 2016, owing to the high consumption of alcoholic beverages in the region. According to the Organization for Economic Co-operation and Development (OECD), in 2012, Lithuania recorded the highest alcohol consumption in European Union and in 2014, the consumption of alcohol among adults was recorded at 15.2 liters per capita. Furthermore, according to the World Bank, in 2015, the per capita consumption of alcohol in Belarus was recorded at 17.1 liters, compared to the global average of 6.3 liters.
• Asia Pacific is expected to witness fastest growth in the global alcohol ingredients market during the forecast period. This is majorly attributed to the steadily growing food and beverage industry and the increasing expenditure on alcoholic beverages in the region. According to Food Industry Asia (FIA), in 2014, the food industry contributed US$ 10.91 billion to the economy of Singapore, while according to the European Union, the total consumer spending on food and beverages in Singapore is expected to grow by 5 percent annually, from 2016 to 2018. This in turn, is expected to increase growth of the retail food sector in the country. South Korea is the fourth-largest economy in Asia Pacific and according to the Agriculture and Agri-Food Canada, the off-trade volume of total alcoholic beverage consumption in South Korea increased from 2085.0 million liters in 2015 to 2136.3 million liters in 2016.

The alcohol ingredients market is marked by intense competition from the major players operating in this market. Frequent mergers and acquisitions, joint ventures and partnerships, product innovation, and geographical expansions are among the key strategies adopted by these players, to ensure long-term sustenance in the market. In 2014, Chr. Hansen Holdings A/S launched a new range of viniflora products such as viniflora NoVA. It is a new generation lactobacillus plantarum, best suited for the production of red wine in warm climate conditions.