Cyclical swing moves process gas compressors market forward
25 Apr 2001
The oil and gas industries are driving the European process gas market forward as it recovers from a downward phase in capital investments by key end-users and loss of revenues owing to falling prices.
The latest research from international marketing consulting company Frost and Sullivan valued the market at $911.2 million in 2000: a marginal increase on the last three years.
Frost & Sullivan anticipates moderate but stable growth in future years as the market continues to recover. It is expected to increase by 2.4 percent to $1.06 billion in 2007.
The growth has and will mainly be driven by the cyclical nature of the end-user industries, particularly oil and gas which are currently enjoying the upward stage of the general five to eight year cyclical swing with a phase of higher investment to increase production levels to meet demand.
The study segments the European process gas compressors market into six sections: turbo process gas compressors (worth $495.9 million in 2000), reciprocating process gas compressors, screw process gas compressors (worth $41.1 million), diaphragm process gas compressors, liquid ring process gas compressors, and process gas compressors spare parts (worth $279.1 million).
It showed a fall in demand for reciprocating and turbo process gas compressors, sectors strongly influenced by severe competition and price discounting in many European regions. In contrast, the other product markets covered by the study - screw, diaphragm and liquid ring process gas compressors, and process gas compressor spare parts - experienced stable growth, although their small overall size in comparison to the reciprocating and turbo process gas compressors markets meant this had less impact on the market.
The main market developments are expected in the spare parts markets, while demand for reciprocating and turbo process gas compressors are forecast to stabilise as the core end-user market maintains growth
However, Frost and Sullivan forecasts market growth will be restrained by several factors, especially fierce price competition, globalisation, market maturity, and the dominance of a small number of leading manufacturers who collectively generated over 60 percent of Europe's market revenues in 2000.
Leading countries include Germany, which remains the largest market for process gas compressors, representing 24.4 percent of European revenues in 2000. This was due to the large number of end-users and the region's strength in industrial processing. The UK was second with 16.4 percent of revenues, Italy third with 14.5 percent, and France fourth with 12.4 percent.
