August 2017 - McIlvaine Insights 27

Join us on August 23 to Discuss the Guide, Control, and Measurement Markets in Pulp and Paper

In 2018 the pulp and paper industry will spend an estimated $1.1 billion for guide, control, and measure products and services. This is the latest forecast in IIoT and Remote O&M published by the McIlvaine Company. The "guide" category includes automation consulting, software and services. This will generate revenues of $330 million. Control which includes automation products will result in purchases of $550 million. $220 million will be spent on measurement including analyzers.

The report provides forecasts for 550 companies in 12 industries including 50 in the pulp and paper segment.

You can register for the August 23 pulp and paper IIoT and Remote O&M webinar. at Weekly IIoT Webinars

Hundreds of Product Forecasts for 550 Largest Combust, Flow and Treat Purchasers

In the new IIoT environment purchases and specifications will increasingly be made at the corporate home office and not in the plants. These decisions will be based on a flow of knowledge from remote monitoring at the plant sites. This requires a new marketing approach shown at Marketing Program for Combust, Flow and Treat.

Product decisions will be greatly impacted by the IIoT environment at each of the 550 companies. Eight automation companies will have an impact on purchases at just under 10% of the purchases.

Sales of IIoT and Process Equipment to the Pulp and Paper Industry 2018 - $ millions
Product	Total Product Revenues		IIoT Impact
	All suppliers	8 companies	All suppliers	8 companies
Guide	330	25	330	25
Control	550	45	550	45
Measure	220	20	220	20
*Total Direct IIoT*	*1100*	90	*1100*	90
Valves	1500	65	150	7
Air Pollution Control Systems	300	10	40	2
Pumps	1200	30	150	3
Water Treatment	2000	50	200	5
Wastewater Treatment	1000	30	100	3
Variable speed drives and motors	1800	120	200	12
Turbines, Fans, and Compressors	3500	600	350	60
Other Process Equipment, Chemicals, and Services	10,000	140	1000	14
*Indirect IIoT*	21,300	1045	2190	106
*Ratio of Indirect to Direct*	19	12	2	1.2

The eight automation companies will have a direct IIoT market in pulp and paper of $90 million. They will also sell another $1 billion of combust, treat, and flow products and services to this industry. By making these products smarter they can boost revenue by $106 million.

With better collaboration between the divisions, the eight companies can use their direct IIoT products to increase market share for all their products. With a 10% increase in market share along with the higher product revenue they could boost revenue by $212 million.

Product suppliers who are not starting to leverage IIoT will lose market share and the potential to increase revenues per unit of product with better and smarter offerings.

Only two of the 8 companies (Emerson and GE) are major valve suppliers. The other six can be pursued for purposes of collaboration.

GE could be a formidable competitor in air pollution control with the Alstom acquisition. Siemens sold Wheelabrator. So, the other seven are collaboration prospects.

Sales of IIoT and Process Equipment to Specific Pulp and Paper Producers 2018 - $ millions
	All Producers	International Paper	Nine Dragon	Stora Enso
Guide	330	16	8	6
Control	550	33	16	12
Measure	220	11	5	2
*Total Direct IIoT*	*1100*	60	29	20
Valves	1500	90	45	30
Air Pollution Control Systems	300	18	9	6
Pumps	1200	72	36	24
Water Treatment	2000	120	60	40
Wastewater Treatment	1000	60	30	20
Variable Speed Drives and Motors	1800	108	54	36
Turbines, Fans, and Compressors	3500	210	105	70
Other Process Equipment, Chemicals, and Services	10,000	600	300	200
*Indirect IIoT*	22,800	1278	639	426
*Ratio of Indirect to Direct*	21	21	21	21

Forecasts of sales for specific products to each of 50 pulp and paper producers as well as 500 manufacturers in 11 other industries will provide a basis for collaboration among divisions within multi product companies as well as for setting up sales programs for each.

The IIoT & Remote O&M report has the forecasts for guide, control and three measurement segments for each of 550 companies x 3 continents = 8250 forecasts.

The Valve report has forecasts for 550 companies' x 8 control valve types plus 8 on/off valve types x 3 continents = 26,400 forecasts.

The scrubber, fabric filter, precipitator, thermal/catalytic, liquid filtration, cartridge, RO/UF/MF, ultrapure water, cleanroom, sedimentation and centrifugation market reports also have detailed forecasts for the 550 companies.

· Level 2 is the market reports with the forecasts of each product for the 550 companies. Markets

· Level 3 is the industry analyses with profiles of each of the 550 companies and continuing project information on each. Oil/gas/refining/petrochemicals is one report. Pharmaceutical, semiconductor and food are in another. Municipal water and wastewater are in one service. The other profiles are in the N031 report.

· Level 4 would be a knowledge system for each of the 550 purchasers funded by the suppliers.