Market For Industrial Cross-flow Membrane Products Will Exceed $10 Billion Next Year

Municipalities and industrial facilities will spend over $10 billion in 2017 for reverse osmosis (RO), nanofiltration, ultrafiltration and microfiltration. This includes the equipment and the replacement membranes. This does not include the residential or commercial market for the small filters.

The largest investment will be for desalinating seawater. The fastest growing geographical market will be China which is embarked on a massive program to provide desalinated drinking water to arid areas from coastal treatment facilities.

Microfiltration is taking market share away from granular media filters in the purification of drinking water due to the reduction in waterborne illnesses with this technology.

The pharmaceutical market continues to grow at a pace exceeding GDP. Cross-flow filtration is used to separate product from broth as well as for provision of ultrapure water for injection in products which will be injected into humans.

For more information on N020 RO, UF, MF World Market click on: http://home.mcilvainecompany.com/index.php/markets/2-uncategorised/120-n020

Here are the some headlines from the Utility E-Alert – April 15, 2016

UTILITY E-ALERT

#1268 – April 15, 2016

COAL – US

• Peabody Energy files for Bankruptcy
• Clyde Bergemann Power Group receives Order for ELG & CCR related Ash Handling Systems for a Major Utility in South Carolina
• Second SCR at Hayden to be completed in 2016

COAL – WORLD

• B&W awarded $80 Million Contract to Supply Boiler to Philippines Power Plant

§  Natural Draft Cooling Tower Order for 450 MW Turow awarded to Hamon

• 600 MW Coal Gasification Power Plant possible in South Australia

§  China's Harbin and Saudi ACWA near Loan for Dubai Clean Coal Power Plant

§  EPTL’s Power Plant Project

The 41F Utility E-Alert is issued weekly and covers the coal-fired projects, regulations and other information important to the suppliers. It is $950/yr. but is included in the $3020 42EI Utility Tracking System which has data on every plant and project plus networking directories and many other features.

International Strategy is Critical for Survival in the Flow Control and Treatment Industries

Whether you sell pumps, valves, filters, fans, compressors, treatment chemicals, scrubbers or centrifuges, you cannot focus on just the U.S., China, or EU market. Here are some examples of major opportunities elsewhere:

The U.S. has placed a moratorium on new coal-fired power plants but China will build far more than the EU or that the U.S. will retire. Vietnam, Indonesia and Myanmar are building power plants with a combined capacity of 150,000 MW.

China is the largest fish farming country, but Indonesia is also large. The industry is moving to sophisticated recirculating systems with a big investment in flow control and treatment equipment.

Australia, a leader in iron ore and coal mining, has become a recent player in LNG with successful conversion of coal bed methane.

Individual projects can measurably impact the market in a given year. There are nine large Canadian potash projects underway with a combined capital investment of over $30 billion. The largest project will require a $4 billion investment. Algeria’s state-owned Sonatrach has let a series of contracts to Amec Foster Wheeler to provide front-end engineering and design (FEED) for three grassroots refineries that will add a total of 15 million tons/year in refining capacity in the country. These few projects represent a significant percentage of the yearly flow control and treatment revenues for the worldwide industry.

Coal-fired projects in Indonesia could result in an investment of over $100 billion. Vietnam is vacillating on plans which would require a coal-fired power plant investment of over $200 billion. Delay or cancellation of large projects can materially affect the revenues of the flow control and treatment suppliers.

Flow control and treatment companies need to pursue the world market. There are 196 countries with more than 50 major industries who purchase flow control and treatment equipment. Many of these countries are quite small. McIlvaine forecasts divide the world into 80 purchasing entities which include 72 separate countries and 8 country groups. The pump forecast example below shows pump sales in Pakistan will be $216 million in 2021, but sales will only be $22 million in a group of countries labeled “Other Western Europe.”

The countries aggregated in the Other Western Europe category are Andorra, Faroe Islands, Gibraltar, Greenland, Guernsey, Iceland, Isle of Man, Jersey, Lichtenstein, Luxembourg, Malta, Monaco, San Marino and Vatican.

The average for the 80 entities in a $60 billion annual market is 0.75 percent. While, as individual countries, many in the “other” category are insignificant, as a group they are relevant. This is particularly true for the Other Africa group which accounts for 0.75 percent of the total market and the Other Middle East group which in the aggregate is bigger than the average.

McIlvaine has created a program to help international flow control and treatment suppliers maximize the global opportunity. It is described at:  Detailed Forecasting of Markets, Prospects and Projects

Bob McIlvaine is available to answer your questions and can be reached at: 847-784-0012 ext. 112  rmcilvaine@mcilvainecompany.com.

Flow Control and Treatment Companies will benefit from a Digital Crystal Ball

The digital age has created the ability to make fortune telling a reality. The real life version of a crystal ball is the wealth of information available to predict markets, projects and identify decision makers. This information can be used to change the way flow control and treatment products are marketed.

Long range purchasing plans can be determined by an organized analysis of information which can be obtained directly from available documents or through individuals who have specific insights.

The local salesman can make a call on a municipal wastewater treatment plant but would be unlikely to provide the same value gained from the directors meeting minutes which outline the failure of the competitor’s equipment and his proposal to fix it.

The power plant modification permit request which details the cost and performance of various options provides the needed insights on product and timing for a potential supplier.

One way suppliers take advantage of the availability of information is to purchase sales leads.  Typically the company spends lots of money on these leads and not on market research.  In one sense, the leads are the market research.  In fact, published studies purport to link the number of sales leads to the size of future markets.

This approach has a number of undesirable aspects:

1.     The large expenditure for sales leads draws funds away from critical market research.

2.     Sales leads are not qualified.  High margins and order conversion result from picking and choosing projects.

3.     Since the sales lead is also being viewed by the competitors, there will be pricing pressure and lower success rates.

4.     The timing of sales leads is often right if you are selling a commodity, but if you are selling based on your product differentiation, you are too late.

5.     Many companies have distributors and representatives who are being paid to uncover leads.  Sales lead expense is justified based on evaluating distributor performance rather than on boosting sales.

If you are selling a commodity, product and price is the basis of success then the sales lead route is probably still the best option. But, if you sell a product based on lowest cost of ownership and not initial price, then you should consider a whole new route using the digital crystal ball.

Detailed Forecasting of Markets, Prospects and Projects is your digital crystal ball because:

1.     Forecasts can be provided for the precise product at the State and province level.

2.     Project alerts provide the time to convince the customer to consider total cost of ownership and to issue bid specifications accordingly.

3.     The large end users, OEMs, and AEs are identified.  Since they purchase more than 50 percent of the flow control and treatment equipment, the focus on them is critical.

4.     The opportunity to connect with the end user through white papers and webinars improves the margin and success potential.

5.     The ability to demonstrate lowest cost of ownership is the secret to success in the global market.

For more information on this program contact Bob McIlvaine 847-784-0012 ext. 112 rmcilvaine@mcilvainecompany.com

Bob McIlvaine
President
847-784-0012 ext. 112
rmcilvaine@mcilvainecompany.com
www.mcilvainecompany.com