Rise in Investments and Business Expansions Expected to Boost the Global Automation Market in Chemicals and Petrochemicals Industry by 2020, Says Technavio
Technavio
analysts expect the global
automation market in chemicals and petrochemicals industry for
2016-2020 to grow at a CAGR of over 7% and exceed USD 7 billion,
according to their latest report.
The global automation market in the chemicals and petrochemicals
industry is expected to register positive growth during the forecast
period due to capital and R&D investments in developing and implementing
automation solutions.
According to Bharath Kanniappan, a lead research analyst at Technavio
for automation,
“Organizations are deploying automation solutions to enhance
productivity. Automation solutions, such as distributed control systems,
programmable logic controllers, manufacturing execution systems, and
supervisory control and data acquisition systems, enable fast and highly
responsive actions and prevent plant operational failures.”
Technavio’s market research analysts for the industrial
automation industry have identified the following three factors
that will drive the global automation market in chemicals and
petrochemicals industry through 2020:
-
Rise in investments and business expansions
-
Reduction in machine downtime
-
Need to comply with government policies and regulations
Rise in investments and business expansions
The chemicals and petrochemicals industry globally is embracing
automation as part of its growing investment allocations in R&D and new
projects. Rising market competition, globalization, and the need to
conform to quality benchmarks have expanded the use of automation
solutions in the chemicals and petrochemicals industries.
Industry-based automation solutions offer scalability and modularity and
help integrate the existing infrastructure with new frameworks.
Automation solutions also help compile details that are specific to
industrial processes from start to finish, thus helping enterprises make
better, faster, and more competitive decisions.
Many chemical and petrochemical vendors such as Sasol and Royal Dutch
Shell are the front-runners in the implementation of automation
solutions in their manufacturing plants. The rise in business expansions
and investments in regions such as the Middle East, the Americas, and
APAC will likely boost the demand for automation solutions in the
chemicals and petrochemicals industry. For instance, in Saudi Arabia, an
investment of USD 20 billion is powering a fully integrated
petrochemical plant in Jubail. A major portion of the investment was
used to implement automation solutions designed by ABB.
Technavio predicts high adoption of automation solutions in APAC, which
was the largest global chemicals producer in 2015. The region will
generate high demand for chemicals following rising demand from other
industries such as aerospace and defense, automotive, and electrical and
electronics. The high growth of these industries in Japan, China, India,
and South Korea will contribute to the growth of the market.
Reduction in machine downtime
The breakdown of machinery has a negative impact on production
processes, which may lead to the loss of substantial revenue for
manufacturing companies. The lack of automation in traditional chemical
and petrochemical industries increases downtime in production activities
and disrupts the manufacturing process.
Disruptions such as frequent power outages on an average, cost USD
700,000 per hour due to production downtime which is reduced to USD
20,000 with the use of automation systems. “This has enhanced the
adoption rate of automation systems in production lines, which has
enabled operators to take corrective actions or send signals to floor
personnel to identify and mitigate issues and reduce machine downtime,”
says Bharath.
Need to comply with government policies and regulations
The US government has enacted stringent regulations and policies for
manufacturing industries such as automotive, foods and beverages,
consumer packaged goods, chemicals, and pharmaceuticals. It has imposed
regulations and policies for good manufacturing practices with a view to
improve public safety and to meet international quality standards.
Stringent regulations designed to curb CO2 emissions, lower power
consumption, and reduce wastage by industries have also been imposed.
Automation systems can directly detect the emission of toxic gases and
help to cut those emissions. Technavio notes that the chemicals and
petrochemicals industries globally are using automation systems to meet
government regulations and boost safety systems.
Automation solutions offer companies real-time information about
production processes and aid in streamlining various aspects of their
processes. Certain automated systems help detect impurities and other
constituents in chemical and petrochemical products. These systems also
detect hydrocarbon liquids before they are transformed into natural gas.
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About Technavio
Technavio
is a leading global technology research and advisory company. The
company develops over 2000 pieces of research every year, covering more
than 500 technologies across 80 countries. Technavio has about 300
analysts globally who specialize in customized consulting and business
research assignments across the latest leading edge technologies.
Technavio analysts employ primary as well as secondary research
techniques to ascertain the size and vendor landscape in a range of
markets. Analysts obtain information using a combination of bottom-up
and top-down approaches, besides using in-house market modeling tools
and proprietary databases. They corroborate this data with the data
obtained from various market participants and stakeholders across the
value chain, including vendors, service providers, distributors,
re-sellers, and end-users.
If you are interested in more information, please contact our media team
at media@technavio.com.
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