-- Falling gas prices will affect demand in the short term after which the market will bounce back, finds Frost & Sullivan
MOUNTAIN VIEW, California, July 28, 2015 /PRNewswire/ -- The North American gas detection market is on a steady growth path. The need to avoid industrial accidents caused by undetected gas leakage as well as increasing pressure from insurance companies is encouraging industries to install gas detectors. Investments in research and development will help manufacturers design cheaper, long-lasting and robust gas detectors, meet client-specific requirements and stay competitive.
Recent analysis from Frost & Sullivan, Analysis of the North American Gas Detection Market (https://www.frost.com/nf31), finds that the market earned revenues of $777.4 million in 2014 and estimates this to reach $900.4 million in 2019. Oil and gas, chemical and petrochemical industries are the major users of gas detectors. The study covers the demand for fixed gas detectors, portable gas detectors and detector tubes in these verticals as well as in water and wastewater treatment, food and beverage, mining and metals, and utilities.
"Increasing safety awareness and stronger enforcement of regulations on emission reduction are driving the gas detection market in North America," said Frost & Sullivan Chemicals, Materials and Food Research Analyst Alisha Basha. "Further, the willingness of many end users to pay a higher price for premium products that include features such as wireless gas detection, remote monitoring and software applications boosts market revenues."
However, a substantial segment of users still consider gas detectors a hefty investment. This, coupled with intensifying competition in the market, is restricting manufacturer profits and causing substantial price erosion. In addition, declining oil prices have significantly affected oil and gas activity, directly curbing the gas detection market since the oil and gas industry is a major end user. If the fall in oil prices persists, several oil rigs across North America might be shut down and the demand for gas detection systems further curtailed.
"On the plus side, the decline in oil prices is expected to increase downstream production, thus sustaining the adoption of gas detectors," noted Basha. "However, this trend will last for a short period of time and will lose its impact when oil prices improve."
Growth will be sustained by the demand for new, cost-competitive technologies that enable compliance with regulations and standards. Users will look for features such as wireless communication and remote monitoring. The market will also see a shift towards service-oriented business models.
"Although the market is already consolidated and dominated by a few participants, acquisitions will continue to change the mature North American gas detection landscape," added Basha.
Analysis of the North American Gas Detection Market is part of the Chemicals & Materials (http://www.chemicals.frost.com) Growth Partnership Service program. Frost & Sullivan's related studies include: Global Thermal Insulation Market, Top Technologies in Clean & Green Environment, and Global Impact and Implications of Low Crude Oil Prices. All studies included in subscriptions provide detailed market opportunities and industry trends evaluated following extensive interviews with market participants.
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