Innovation to Drive Growth in Abrasives Market
The global abrasives market will likely reach over $5 billion by 2020.
The global abrasives market will likely reach over $5 billion by 2020, according to a recent research report released by Technavio. “The global coated abrasives market is highly competitive,” said Chandrakumar Badala Jaganathan, industry analyst. “Therefore, manufacturers are focusing on the development of innovative products to gain a competitive edge in the market and increase profit margins. Manufacturers have undertaken many strategic initiatives to survive in this intensely competitive market. For instance, manufacturers are pursuing forward integration strategies in the abrasives value chain.
“Rapid development in the e-business trading platforms is compelling vendors to directly market and distribute their products to eliminate intermediaries in the value chain. For example, sia Abrasives and Norton Abrasives are seeking to expand their distribution channels by taking the online route to build their international brand. These steps are envisaged to help vendors increase their revenue and maintain their profit margins over the next four years.”
Some of the other driving forces behind the growth of the global abrasives market are: product innovations and growing acceptance of complex medical devices; augmented demand for abrasives in automobiles; growing use of abrasives in the electronics industry; and growth in global industrial production.
The global coated abrasives market falls under the red ocean category, whereby competition among global and regional manufacturers is extremely intense. Manufacturers are focusing on the development of innovatively coated abrasive-based products to gain a competitive edge. For instance, in the wood industry, vendors are introducing fabric- and polyester-based abrasives. Automotive and metal fabrication sectors are also focusing on the development of advanced coated abrasives systems.
In the medical industry, abrasives are used to clean and provide finishing to devices such as osseointegrated implants. These complex devices are required to maintain high standards of cleanliness to adhere to health and safety requirements. Abrasive blasting is therefore used in cleaning implantable devices, catheters, guide wires, tubular components, needles, vascular stents, surgical instruments, and medical molding as it provides precise and efficient cleaning.
The global automotive market is expected to grow at a compound annual growth rate (CAGR) of 5-6% during the forecast period. Rapid urbanization and increased spending power from emerging economies are propelling growth in the automotive industry. Significant economic and industrial development, especially in Asia-Pacific, is also cited as a key reason that augments the increased demand for automobiles due to the need for better transport services. Efficient finishing in automobiles requires the use of abrasives. These are used for sizing engine parts, deburring, and cleaning. Abrasives are also used to repair and maintain auto body, interiors, and accessories. Abrasives are used to smooth welds, clean the interior of pipes, and roughen or smooth surfaces and edges.
The growth has been rather steep in the emerging economies of India, Brazil, Russia, Indonesia, Thailand, and China. China alone accounts for about one-fourth of the global automotive demand, and its share is expected to increase further over the forecast period. This continuous rise in demand for automobiles is therefore driving the expansion of original equipment manufacturers (OEMs), which play a crucial role in the automotive value chain. This expansion in the OEM base is driving the demand for industrial raw materials, particularly production machinery and abrasive tools, for finishing and fabricating purposes.
The demand for coated abrasives is high in the electronics industry due to low costs and provision of efficient finishing. Increasing sales of electronic devices are likely to boost the demand for coated abrasives in the electronic industry during the forecast period, especially in the consumer goods sector. In the consumer goods sector, coated abrasives are used to polish fiber optic connectors and to provide finishing to edges and flat surfaces of electronic devices and semiconductors. The electronics and semiconductors sector is expected to grow steadily during the forecast period due to the increased demand for consumer electronics, including mobile phones, computers, and related electronic equipment from the emerging economies.
For more information, visit http://technavio.com.