ASIA PACIFIC WATER TREATMENT CHEMICALS MARKET 2014 - 2019 Market Shares, Forecasts & Trends
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1.2 RESEARCH METHODOLOGY The research methodology can be put into the following sequence: 1) Secondary Research: Information was collected from a number of public and paid data sources. Public sources involved GWP, WWC, WHO, Ministry of Water Resources (MWR) in China, CPCB-India, India Water Portal, Japan Water Agency, company annual reports, white papers and research publications by recognized industry experts. Paid data sources include authentic industry databases.
2) Primary Research: After collecting data from secondary sources, primary interviews were conducted with stakeholders at different points of the value chain like manufacturers, distributors, companies producing chemicals, end-product users and key opinion leaders of the industry. Primary research was used both to validate the data points obtained from secondary research and to fill the data gaps after secondary research.
3) Market Engineering: The market engineering phase involves analysing the data collected, market breakdown and forecasting. Macroeconomic indicators and bottom-up and top-down approaches are used to arrive at a complete set of data points that give way to valuable qualitative and quantitative insights. Each data point is verified by the process of data triangulation to validate the numbers and arrive at close estimates.
4) Expert Validation: The market engineered data is verified and validated by a number of experts, both in-house and external.
5) Report Writing: After the data is curated by the mentioned highly sophisticated process, the analysts begin to write the report. Garnering insights from data and forecasts, insights are drawn to visualize the entire ecosystem in a single report. VIEW THIS REPORT ON OUR WEBSITE
3.2 FACTORS DRIVING THE WATER TREATMENT CHEMICALS MARKET: 3.2.1 GOVERNMENT REGULATIONS AND SCHEMES Government regulations, schemes and investments have a major role in driving the water treatment industry as well as aiming to provide water connectivity to all citizens. The Chinese government is encouraging the investments in China’s water treatment market. The Chinese water treatment market is expected to reach $50 billion by 2015, making it the world’s largest. Further, the government had announced in 2011 that it intends to invest $636 billion through the year 2020 in projects to harness water and prevent water-related disasters. The Chinese water treatment market is largely decentralized, regionalized, and dependent on foreign investment in new technologies. The Sino-Israel Water Industrial Park in Guangdong Province, is one of the ways the Chinese government is seeking to develop advanced water technologies and which is expected to serve as a gateway for Israeli and western companies to enter and invest in China’s water market. Veolia and Suez Environnement are the major foreign investors and Beijing Capital, China Everbright International, Tianjin Capital Environmental Protection are the largest domestic investors. According to the Ministry of Housing and Urban-Rural Development (MOHURD), out of the 4,000 water treatment plants in China, the quality of the source water at less than half of them meets the national standard. The Ministry has plans to upgrade about 2,000 water plants between 2011 and 2015, as well as build an additional 2,358 water plants with a combined capacity of 40 million cubic metres per day, to meet the demands of urbanisation. This represents a major opportunity for water treatment equipment manufacturers and private developers of water plants. In India, the National Rural Drinking Water Programme (NRWDP) came into force since April, 2009 with a vision "Safe Drinking Water for all, at all times in rural areas." In 2012-13 a total sum of $ 3.5 billion was allocated under the NRWDP, out of which over $ 1.86 billion were spent through various central and state water supply schemes. The World Bank finances a number of projects in urban and rural areas that are fully or partly dedicated to water supply and sanitation. In urban areas the World Bank supports the $ 1.55 billion National Ganga River Basin Project approved in 2011 and funds VIEW THIS REPORT ON OUR WEBSITE
most Indian states in various projects each amounting to hundreds of million dollars. In February, 2014 the government of India and World Bank signed a $500 million agreement to improve rural water supply and sanitation services in four Indian states of Assam, Bihar, Jharkhand and Uttar Pradesh. In Japan multiple entities are responsible for the water supply- the Ministry of Health, Labor and Welfare; the Health Bureau; the Water Supply Division; the Ministry of Internal Affairs and Communication and the Local Public Financial Bureaus. For sewerage services, the Ministry of Land, Infrastructure, and Transportation, the City and Regional Development Bureau, the Sewerage Department, and MIAC are responsible. The Ministry of Health, Labour and Welfare (MHLW) gives a license to water utilities with the service population of 50,001 or over, or water utilities for bulk water supply with the maximum distribution volume of more than 25,000 m3/day .
3.2.2 POWER AND INDUSTRIAL SECTORS AS GROWTH DRIVERS The power industry is one of the greatest consumers of water worldwide and in Asia Pacific, thus making industrial water and wastewater treatment of vital importance. Asia Pacific regions predominantly depend on thermal energy for electricity although hydroelectricity and renewable energy sources are on the rise. Power and industrial usage accounted for 35 % of the total water used in 2013. The highest consumption of water treatment chemicals is seen by the Oil and Gas Industry. Although Power and Industrial Sector is expected to have a healthy growth in Asia Pacific, international players are somewhat restrained by project approval bureaucracy, lack of project management skills in government, 2-3 years as typical time from project to start-up cycle time for sanitation companies, strong local currency devaluation, government stimulus plans designed to protect local industry, high import costs leading to loss of pricing competitiveness. More industrial growth is to be witnessed if these factors are addressed and lessened.
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The water treatment chemicals consumed in total value ($ billions) by different Industrial sectors is given in the table below.
CAGR%
Industrial Sectors
2012
2013
2014
2020
Oil, Gas and Coal Power Plants
xx
xx
xx
xx
xx
Pulp and Paper
xx
xx
xx
xx
xx
Food and Beverage
xx
xx
xx
xx
xx
Chemicals
xx
xx
xx
xx
xx
Mining
xx
xx
xx
xx
xx
Others
xx
xx
xx
xx
xx
(2014-2020)
In industries, water treatment is done mainly for coolant water, effluent water and other industrial machinery water. The technologies used in treatment vary with the type of effluent and also on the industry choice and suitability. The major amount of specialty chemicals is generally used up during the pre-treatment stage to enhance settling, process performance and to minimise scaling and corrosion. Technologies, of which generally more than two are involved in a complete water treatment process are Coagulation and Settling, Aerobic and Anaerobic Biological Treatment, Reverse Osmosis, Ion exchange, Thermal Oxidation, Adsorption in Granular Activated Carbon, Air Stripping, Evaporative Crystallisers, Evaporative Brine Concentrators and Spray Drying. Chemicals used up in these processes are generally Coagulants- Alum, Ferric Chloride, Ferric Sulphate; Flocculants- Carboxylates, Polyampholytes; Corrosion Inhibitors- Hydrazine, Morpholine, Silicates, Phosphates, etc; Scale Inhibitors- Polyacrylic Acid, Phosphoric Acid, Phosphate Esters; pH regulators- Sodium Hydroxide, Natrium Hydroxide, Calcium Carbonate, Calcium Hydroxide, Sulphuric Acid, Hydrochloric Acid; Resin Cleaners- Sodium Chloride, Potassium Chloride, Citric Acid, Chlorine dioxide; Biocides and Disinfectants- Chlorine and Chlorine Compounds, Ozone; Oxidants- Hydrogen Peroxide, Ozone, Oxygen, Chlorine; Oxygen Scavengers- Hydrazine, Carbohydrazine, Hydroquinone, Sodium Sulphite, etc.
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The major end users industries and organisations for water treatment chemicals are Ecolab, Nalco, Hydration Technology Innovations, Tri-Tech, PT Beta Pramesti, United Envirotech, Siemens, Hindustan Dorr-Oliver Ltd, Ovivo (Formerly Eimco Water Technologies), Veolia, EnviroChemie GmbH Technology for Water, Hitachi Plant Technologies, WABAG, Hyflux, Clarke Energy, Aquatech International Corporation, Calgon Carbon Corporation, ThermoEnergy Corporation, Lenntech Water Treatment, Beijing Capital Co. Ltd, Sound Group, Sino French Water Development Co. Ltd, Tianjin Capital Environmental Protection Ltd, Indian Oil Corporation Ltd, Nuclear Power Corporation of India Ltd, China National Nuclear Corporation, China General Nuclear Power Group.
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5. MARKET SEGMENTATION 5.1 BY PRODUCT Asia Pacific’s water and wastewater treatment chemicals market was worth about $ 8.1 billion in 2013 and due to a current and expected CAGR of about 8.8 % it should double over the next eight years. Over the last decade, several investments and regulations in this sector have been made in order to meet the growing pressures by both society and environmental agencies seeking the protection of the environment, quality of life, and social welfare. Although remarkable advances of up to 98% coverage in certain countries like Japan and Australia have been made in areas of drinking water coverage, sanitation, domestic piping and other issues in the last few decades, the growth in water treatment industry is far from being saturated and is expected to show a healthy growth over the next two decades although towards the end, mainly fueled by the huge and fast growing markets in China and India and propelled by government fundings. Ion Exchange Resins constitute the major product type consumed in water treatment. The water treatment chemicals consumed in total value ($ millions) by different product types is given in the table below. CAGR%
Chemical Types
2012
2013
2014
2020
Biocides and Disinfectants
xx
xx
xx
xx
xx
Coagulants and Flocculants
xx
xx
xx
xx
xx
Corrosion & Scale Inhibitors
xx
xx
xx
xx
xx
Ion Exchange Resins
xx
xx
xx
xx
xx
Anti Foams
xx
xx
xx
xx
xx
pH Adjusters & Softeners
xx
xx
xx
xx
xx
Membrane Products
xx
xx
xx
xx
xx
Other Chemicals
xx
xx
xx
xx
xx
(2014-2020)
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9. COMPANY PROFILE 9.18 KURITA WATER INDUSTRIES LTD Kurita Water Industries Ltd Nakano Central Park East Tokyo Tokyo 164 Japan http://www.kurita.co.jp/
Kurita Water Industries Ltd. is a Japanese water treatment company, founded on July 13, 1949 and is headquartered in Tokyo, Japan. It provides water treatment-related products, technology, maintenance, and services. It operates through two business segments - water treatment chemicals and water treatment facilities. Kurita Water Industries has 24 subsidiaries and one affiliate in Japan and has established 14 overseas subsidiaries and affiliates- in China, USA, Malaysia, Brazil, Indonesia, South Korea, Thailand, Germany, Taiwan and Singapore. Since 2003 Kurita Water Industries is listed in the Nature Stock Index. The company generated sales of $ 520 million in 2012 in the water treatment chemicals segment and $ 1.25 billion in treatment facilities segment.
ANALYST VIEW The water treatment facilities segment provides ultrapure water production system, water treatment systems, and wastewater reclamation systems. The water treatment chemicals segment of the company provides chemicals for boiler water treatment, cooling water treatment, wastewater treatment and also process treatment chemicals for various industries. Kurita Water Industries Ltd. has been an highly innovative company catering to the needs of a broad spectrum of industries including - pharmaceutical, pulp and paper processing, petroleum refining, petrochemical, steel, boilers, cooling water and air conditioning, civil engineering processes, heavy
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metal fixatives among others. In July 2014, Kurita developed and begun sale of a high-performance, low-cost purified water production system for pharmaceutical manufacturing processes which was highly effective for blocking proliferation of living microbes and improving the quality of water used in manufacturing pharmaceuticals. This water treatment system developed produces pure water through ultraviolet sterilization, reverse osmosis membrane treatment and continuous electric deionizer and without the use of an activated carbon filter. Similarly in June 2014, Kurita has also developed and commenced the sale of Kuritight CW and Kuritight CX, which are safe cooling water treatment chemicals produced solely from food additives.
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