Manufacturers of pipe systems have enjoyed strong growth over the past couple of years driven by the recovery in the German building industry and strong growth in Central and Eastern European markets, but face challenging times ahead as residential building activity drops steeply and commercial and infrastructure project investment slows down. The position and status of Europe�s leading suppliers of plastics pipes is reviewed in a new report by Applied Market Information.
Plastic pipe production in Europe is dominated by a few major groups. Wavin is the
clear market leader and has further consolidated its position in recent years with
acquisitions which have included Hepworth Building Products in the UK and Pilsa
Plastic in Turkey, which will give it an important foothold to target the rapidly
developing markets in the Balkans, the CIS and the Middle East. The current
challenging business climate though has resulted in some downsizing and restructuring in the Irish and UK markets. Pipelife, Europe�s second largest producer
has also made a number of acquisitions over the past five years, as well as expanding into Russia.
A notable change since the last edition has been the restructuring at Uponor.
Following a series of disappointing results in the early 2000s the company changed
strategy and decided to divest some of its commodity businesses in soil and waste and concentrate on higher value systems for residential markets. These changes have resulted in the closure and disposal of several operations over the past five years. While in volume terms it is now outside the top 10, it remains one of the market leaders in value terms.
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The industry is estimated to use over 3 mln tons of polymer, accounting for around 8% of total European demand for thermoplastics.
Of the suppliers of both gravity pipes and pressure pipes across Europe listed, around 420 manufacture pressure pipes and more than 460 non-pressure pipes. Pressure pipes include gas and water transmission and hot and cold water plumbing. Gravity pipe covers sewerage, drainage, guttering, downpipes and cable protection systems. The gravity pipe sector is by far the largest in terms of both volume and value accounting for more than 70% of the total demand for plastics pipes in Europe. PVC is the main material used in gravity pipes although it is expected that its share of the market will decline slowly as PE and PP systems penetrate the market. The building cycle is also expected to take a strong downward turn in the face of the global �credit crunch� and a slowing of European economic growth which will further impact on demand for PVC gravity pipes.
Polyethylene gravity pipe is expected to benefit from investment in storm water and
road drainage with twin wall pipes making progress against concrete in the larger
diameter sector. The cable protection sector is extremely volatile because of
fluctuations in telecom and cable network investments but remains an important
segment of the market.
For pressure pipes the main plastic material used is polyethylene (PE 80 and PE 100).
Growth has largely been driven by the replacement of metal pipes (ductile iron for
water pressure, copper and steel for hot and cold plumbing) and PVC. There has been particularly strong growth in PE 100 systems. In water pressure pipes it has made gains at the expense of ductile iron but has also replaced some PE 80 systems. The market for gas pressure pipes tends to fluctuate significantly from year to year
depending on the investment plans of the gas providers. In hot and cold water
plumbing and heating applications the main polymer material used is cross-linked
polyethylene (PEX) although recent years has seen considerable growth in the use of
multilayer composite pipes of PEX/aluminium or raised temperature polyethylene
(PE-RT)/aluminium.
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In another study by Freedonia, global demand for plastic pipe will grow 4.4% pa through 2010 based on better prospects in developed nations coupled with continued strong growth in many developing countries, particularly China. This will be primarily due to increased construction activity, expanding use of plastic pipe in crop irrigation and natural gas distribution, replacement of competitive pipe materials and recovery in electrical conduit applications.
China and other developing regions will pace overall growth. In North America, Western Europe and Japan, growth will derive from expanding construction activity and marginal increases in market penetration. Nevertheless, these geographic markets for plastic pipe are well established and comparatively mature. As a result, gains in these regions will trail overall growth. Developing markets, such as the Asia/Pacific, Latin America, Eastern Europe and Africa/Mideast regions, will continue to post above average gains as plastic pipe materials displace other materials. Growth will benefit from a range of factors, including rapidly growing construction activity, increased market penetration by plastic materials, expanding irrigation of crop land and greater use of plastic pipe materials in natural gas transmission. In particular, China will continue to post outsized gains through 2010, reflecting strong building construction, infrastructure modernization, expanded crop irrigation and the displacement of other pipe materials. Polyvinyl chloride (PVC) pipe, which dominates demand, will continue to be the largest volume plastic pipe material in use, due to its durability, low cost and ease of installation. Nevertheless, demand for other types of plastic pipe will post greater rates of growth through 2010. High density polyethylene (HDPE) pipe, for example, will benefit from growing use in natural gas transmission, electrical conduit and in corrugated drain and sewer pipe applications. |
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