A recent research report said North America was the biggest market for water and wastewater pipes, following a revival, but China and India hold the key for future market trends.
Labeled the “Water and Wastewater Pipe Market: Global Industry Analysis and Forecast to 2020” the report by Persistent Market Research said that while Europe was number two, China and India, with their rapid urbanization and rise in living standards, were budding markets. According to one expert forecast, by 2050, India was expected to add more than 400 million urban dwellers while China will add 292 million. With more people staying in cities and towns, their water and wastewater system meant an increase in the demand for water and wastewater pipe.
While a water pipe is basically there to supply water, a wastewater pipe flushes wastewater into sewers. These are normally made of steel, cast iron, and copper, though recently, Polyvinyl Chloride (PVC) and High Density Polyethylene (HDPE) pipes have started making inroads in the market.
In the US, wastewater pipe demand was estimated to grow at over 7% per year to $17.8 billion by 2018, creating much needed demand from the US metals market. Another report by the Freedonia Group had pegged the demand in the US to grow by 7.7% per year to $18.1 billion in 2018.
US Market Needs Upgrades
According to the Environmental Protection Agency, utilities need to spend $633 billion over the next two decades to supply water and to treat sewage. A revival in the US construction market was expected to drive fresh impetus, though many analysts felt that eventually, the plastic pipe segment would retain the largest hold of the new pipe networks.
One of the biggest multinational players in the US market in this segment, Aegion Corporation, too, had forecasted strong growth. Its 2015 second quarter financial results declared late in July that its infrastructure solutions platform was benefiting from increased expenditures for municipal wastewater pipeline rehabilitation in the US. Municipal expenditures for wastewater pipeline rehabilitation remained at attractive levels led by improved financial health and several large EPA consent decree enforcement actions, it added.
Incidentally, Aegion Corporate has several joint ventures and subsidiaries throughout the Asia-Pacific region including Australia, Singapore, Hong Kong and India.
Indian Water Market
In India, on the other hand, analysts said there were huge private sector opportunities in the Indian water market. Capital expenditure itself in the water and wastewater sector was expected to touch US $9.1 billion in 2018.
The Indian government, sensing the opportunities, had proposed a total budget of US $23.3 billion for water and wastewater infrastructure between 2013 and 2017.
- Growth in India is coming in several ways:
- Municipal and industrial wastewater treatment: A high priority in recent government policies, and water reuse. This is also where foreign companies like those in the US are expected to play a big role.
- Private sector: Expected to play a crucial role in the efforts to improve India’s water supply and wastewater treatment.
India lagged in water infrastructure and sewerage development with only about 35% of the total population having access to improved sanitation. In rural areas, where about 65% of India’s population lives, only about 25% has coverage for sanitation.
With traditional players in the ductile iron pipe business such as Jindal Saw Pipes, Jai Balaji, Tata Metaliks Kubota, and Electrotherm, the market is set to see the entry of new players, some of whom will laterally integrate Indian infrastructure projects with their existing core business activities.