Food, healthcare industries be main driver industrial gases market
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Food, healthcare industries to drive industrial gases market

9:50 AM, 17th July 2018
Nitrogen is the largest segment in the global industrial gas market at 28% of the market, worth $20.7 billion. © NiGen International
Nitrogen is the largest segment in the global industrial gas market at 28% of the market, worth $20.7 billion. © NiGen International

Industrial gases also referred to as bulk gases or commodity gases. are produced in large quantities for use in a variety of industrial manufacturing processes. The industrial gas industry comprises manufacturers of industrial organic and inorganic gases in compressed, liquid, and solid forms, according to a report by The Business Research Company.

The global industrial gas market is forecast to grow at a compound annual rate of 4.44% between 2017 and 2021. This growth is being driven by global economic growth, particularly in emerging economies, and by the increased use of gas in the food and beverages and healthcare industries.

Asia Pacific’s industrial gas market is the largest in the world at 35% of the total market, worth nearly $26 billion. Asia Pacific’s large market size results in part from the presence of the many electronic manufacturing companies in the region, especially in countries such as China, Japan, Singapore, Malaysia and Thailand. North America’s industrial gas market is the second largest in the world with a 31% share of the market, worth nearly $23 billion.

Nitrogen is the largest segment in the global industrial gas market at 28% of the market, worth $20.7 billion. Nitrogen has the largest share due to the presence of established pharmaceutical, food processing and general manufacturing industries that use nitrogen widely in their manufacturing.

The manufacturing industry is the largest end user in the global industrial gas market at 27% of the market, worth $19.5 billion. This is mainly due to the demand for industrial gases such as nitrogen and hydrogen. Metallurgy is the second-largest segment by end use and the chemicals industry is the third.

The global industrial gas market is benefitting from consumer demand for freshness in food products. Health-conscious consumers are demanding fewer additives and safer and fresher food products, which increases the demand for industrial gases such as carbon dioxide that can sometimes be used in place of chemical ingredients.

As a result, the food and beverage industry are buying increasing quantities of food-grade industrial gases to chill, freeze, and package a variety of food products such as dairy and frozen products, beverages, fruits, vegetables, meat, fish, seafood, convenience foods, bakery and confectionery. Food-grade gases are high purity gases that comply with food grade standards; they include nitrogen, oxygen, and carbon dioxide. Healthcare is another market where the demand for high-grade gases is buoyant.

The global industrial gas market is highly concentrated. L'Air Liquide S.A is the largest competitor with 24% of the market, followed by The Linde Group, Praxair Inc., Air Products and Chemicals Inc., and Taiyo Nippon Sanso Corp. Global industrial gas mergers and acquisitions (M&A) are expected to increase in the coming years, following on from strong activity in 2015 and 2016 when companies like L’Air Liquide and Praxair acquired other companies.

For example, L’Air Liquide acquired Air Gas for $10.3 billion in May 2016. Industrial gas companies are continuing to realign their portfolios and pursue profitable inorganic growth opportunities. In addition, M&A interest is likely to be fueled by stronger corporate balance sheets, liquid debt markets, and continuing favourable interest rates.

© Worldofchemicals News

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