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News Release from: ARC Advisory Group | Subject: Control valve market
Edited by the Processingtalk Editorial
Team on 03 October 2006
Current boom in control valve sales to
slow
Driven by strong project activity, the worldwide control valve market experienced double-digit growth in 2005, but the market is only expected to grow at 5.5%pa for the next five years
Driven by strong project activity, the worldwide control valve market experienced double-digit growth in 2005 Over the next five years, the worldwide market for control valves is expected to grow at a compounded annual growth rate (CAGR) exceeding 5.5%
This article was originally published on Processingtalk on 30 Nov 2007 at 8.00am (UK)
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The market was roughly US$3.5 billion in 2005 and is forecasted to exceed US$4.5 billion in 2010, according to a new ARC Advisory Group study.
The global control valve market is in the midst of a phase of unprecedented growth due to booming greenfield plants in developing countries and exploding investment in oil and gas exploration and production.
Senior ARC Analyst David Clayton advises: "Consequently, nearly all control valve suppliers are experiencing double-digit growth, while pressured to meet demand.
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This expansion phase will not last forever, so control valve suppliers would do well to prepare themselves now for the inevitable market downturn".
David Clayton is the principal author of an ARC report entitled: "Control Valve Worldwide Outlook".
As demand for control valves has skyrocketed after years of decline, many control valve suppliers are struggling to meet the demand.
The leading obstacle to meeting demand in the control valve market is limited manufacturing capacity in the foundry industry.
Foundries are a necessity in the manufacture of control valves because they are used to forge steel into finished valve bodies.
Several factors contributed to the decline in the number of foundries in operation between 2000 and 2005 including high prices for raw steel and the overall shift in emphasis towards software-based products.
While the control valve market was focused on developing software and digital positioner products, the decline in foundry capacity was not a problem.
With the industry's renewed emphasis on hardware sales, however, the limited number of foundries available is a challenge for control valve suppliers.
How effectively control valve suppliers can address the drive toward integrating information technology with process plant operations are key differentiators for the success of control valve suppliers today.
As process manufacturers work to add intelligence in production assets to improve process control and visibility, many control valve providers have strained to adequately address this need.
To compensate for the lack of a single source automation solution, many control valve suppliers have joined forces with leading control system suppliers.
Working together, control valve and control system suppliers are able to exchange asset and process knowledge for enriched asset management solutions.
Using process data and device application knowledge to identify issues and problem areas, analysis of assets provides potential solutions that are presented to both operators and maintenance personnel.
The success of these initiatives will determine the market landscape for years to come.
China and India Lead Growth.
China and India have dynamic and expanding economies, and these are the main driving factors behind growth occurring in control valve, actuator, and positioner investments worldwide.
Chinese production is skyrocketing, reflecting its strong economic growth and signaling its emerging status as a major global manufacturing force.
China is the fastest growing economy in the world, and is expanding its industrial infrastructure at breakneck speed to meet growing demand from increasing consumption.
Large chemical and petrochemical plants, grass-root oil and gas refineries, and new power plants are fueling much of the market growth in China.
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