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The chemicals segment is projected to witness the fastest growth

The chemicals segment is projected to witness the fastest growth



Pressure vessel sector to reach $185bn

Growth in the global pressure vessel (PV) market is expected to be driven by the increasing upstream and downstream activities in the oil and gas industry

June 2017

The global pressure vessel market is expected to reach $184.87 billion by 2021, growing at a compound annual growth rate (CAGR) of 5.38 per cent from 2016 to 2021, according to a new report.

This growth is attributed to growing demand for electricity and power generation capacity additions. Increasing upstream and downstream activities in the oil and gas industry is the major factor expected to drive the pressure vessel market, said a report by Markets and Markets.

Pressure vessels are containers designed to hold liquids or gases at high pressure. They have wide applications across various industries including chemicals, oil and gas, petrochemicals, power in the form of compressed air receivers, distillation towers, hot water storage tanks, nuclear reactor vessels, and natural gas storage systems.

They form an integral part of industry infrastructure for safe handling of gases and liquids. Increasing investment to build high performance-infrastructure for oil exploration activities is expected to drive the industry. The tanks are also used to store propane which is a by-product of liquefied gas processing.

Their application as boilers in thermal energy production is further anticipated to augment the industry volume in near future. These boilers are also used for the domestic hot water system. Many companies need water in the purest form and use fractional distillation. Overall product usage in distillation towers is anticipated to provide great opportunities for overall industry growth, the report said.

In addition, they find their applications in the hydraulic and pneumatic reservoir under pressure, rail vehicle airbrake reservoir, and in storage vessels for liquefied gases, such as ammonia, chlorine, and liquid petroleum gas (LPG).

 

MARKET ECOSYSTEM

The pressure vessel market starts with raw material suppliers, which include steel, other alloys, composite materials, and welding equipment. In the later stage, suppliers of pressure vessels use these raw materials to fabricate the pressure vessels. Fabricated vessels are then offered to different industries such as oil and gas, power generation, chemicals, mining, and water and wastewater Wsectors.

The pressure vessel market is segmented on the basis of end-user industry, type, material, and region.  By end-user industry, the market is split as per: chemicals, oil and gas, power and others. By type, it is divided into: boilers, nuclear reactors, separators and others. By material: steel alloys, other alloys composites and by region: Asia-Pacific, North America, Europe, Middle East and South America.

In the pressure vessel market, by material, the steel alloys segment is expected to lead during the forecast period. Steel alloy dominated the market with an approximate share of 40 per cent in 2015 and is expected to continue its dominance owing to easy availability of steel and superior qualities. The composite materials sector is anticipated to witness the highest growth over the forecast period. Some composite based vessels are expected to offer better performance than steel, which is expected to increase its preference in the near future.

 

CHEMICALS END-USER

Chemicals manufacturing is anticipated to witness the highest growth rate of 5.8 per cent on account of increasing chemical projects in developing regions including the Middle East and Asia Pacific.

The chemicals industry requires pressure vessels to store industrial liquids and other materials that are required in the production of their final products; sometimes they are also used to store the final product until shipped. Additionally, the chemicals industry utilises pressure vessels to convert raw materials by mixing, blending, and heating to produce the final product. The chemicals segment is projected to witness the fastest growth during the forecast period. This growth is attributed to increased annual production growth in the global chemicals industry. This in turn would require deployment of pressure vessels.

 

Pressure vessels: an integral part of industry infrastructure

Pressure vessels: an integral part of industry infrastructure

BOILERS SEGMENT TO LEAD

Boilers are anticipated to grow at significant rate over the forecast period on account of its wide industrial applications, especially in fractional distillation. Around one-fourth of the industry in 2024 is expected to be captured by in nuclear reactors on account of increasing atomic energy implementations.

Boilers are primarily employed in power plants for generating high pressure steam to produce electricity. It is estimated to be the largest segment, by type, for the pressure vessel market in 2016. Increasing demand for electricity in Asia-Pacific requires integrated equipment for power generation, which in turn, is likely to drive the pressure vessel market. With majority of applications in power generation, this segment has a prospective market in Asia-Pacific.

 

AP - THE LARGEST MARKET

Asia Pacific (AP) was the leading regional market and accounted for 38.3 per cent of total market revenue in 2015. Growth of power and chemicals industry in China and India coupled with government support to expand power generation capacities are anticipated to drive the regional market.

Asia-Pacific is expected to grow at the highest rate from 2016 to 2021. Countries such as South Korea, Japan, and Malaysia also have high-growth prospects in the Asia-Pacific pressure vessel market. Increasing focus on renewable power generation and modernisation of existing power infrastructure is likely to further boost the demand for pressure vessels in the Asian region.

 

COMPETITIVE LANDSCAPE

The global pressure vessels market is characterised by the presence of international, regional, and local vendors. At present, several local and regional vendors provide high-tech and highly customised products at lower prices than international vendors. There are new vendors emerging in this market. However, they find it difficult to compete with existing vendors in terms of quality, features, functionalities, and services.

“In the next few years, the competitive environment in this market is expected to intensify because of an increase in product extensions, technological innovations, and mergers and acquisitions,” said Gaurav Mohindru, a lead unit operations research analyst from Technavio.

Some of the leading players in the pressure vessel market, namely, Mitsubishi Heavy Industries, Ltd (Japan), Babcock and Wilcox Enterprises (US), Doosan Heavy Industries & Construction (South Korea), Bharat Heavy Electricals Limited (India), and Larsen & Toubro Limited (India) have been the most active in terms of strategic developments from January 2014 to April 2016. Most of these market players are present in Asia-Pacific and the US and have been actively participating in competitive developments.

Technavio has announced the top five leading vendors in their recent global pressure vessels market report.

The major end-users of pressure vessels are the chemical, power, and fuel processing industries. In 2016, the growth in the manufacturing sector was another major contributor to the global pressure vessels market. This growth is expected to increase the demand for power, chemicals, mineral and ores, and oil and gas, thereby, attracting investment towards these industries.

 

TOP FIVE MARKET VENDORS

Alfa Laval: Alfa Laval develops and supplies specialized products and engineered solutions for heat transfer, separation, and fluid handling applications including pressure vessels. Its products are designed to optimize processes such as cooling, heating, separation, and transportation of products, including chemicals, oil, water, beverages, and foodstuff.

Amec Foster Wheeler: Amec Foster Wheeler supplies engineering, construction, and project management contractor and power equipment including pressure vessels. It designs and constructs infrastructure and processing facilities for industries such as oil and gas, LNG and gas monetization, refining, chemicals, pharmaceuticals, minerals and metals, and power.

Halliburton: Halliburton is one the major players in the global pressure vessels market offering three-phase separators. The company offers surface well testing and three-phase test separators to provide safe and efficient separation. The three-phase separator measures the separation of oil, gas, and water phases produced in the reservoir. It is used for well-testing applications and clean-up operations for stimulated walls.

Kelvion: Kelvion is the successor to the GEA Heat Exchangers Group. The company offers one of the world›s largest product portfolio for heat exchangers which are a key type of pressure vessels. Kelvion produces various heat-exchanger products for end-user application and complex environmental conditions.

Mitsubishi Hitachi: Mitsubishi Hitachi is a joint venture of Mitsubishi Heavy Industries and Hitachi. The company manufactures thermal power generation systems. It offers fossil fuel power plant solutions, including gas turbines, conventional power plants, industrial boilers, boiler machinery, industrial steam turbines, steam turbines, turbine generators, and flue gas equipment.




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