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The pumps market in Europe has grown consistently, riding on high oil prices and the resulting boom in process industries, according to a Frost and Sullivan research analyst.

Ram Ravi, a research analyst with the company’s European Industrial Process Control and Automation practice, focuses on monitoring and analysing emerging trends, technologies and market dynamics in the pumps, valves and compressors market in Europe.

In 2008, the pumps market for process industries in Europe was valued at approximately USD5bn (GBP3bn).

However, with the onset of the economic crisis towards the end of 2008, the demand for pumps saw marginal decline in certain end-user industries where projects were delayed or postponed as a result of the credit crunch.

With Europe’s major economies sinking into recession, industrial production in the region has declined during 2008-09.

Among the various process industries, the chemical industry and its subsectors will be the worst hit.

With customers’ spending confidence anticipated to be low, this trend is expected to continue into 2010.

As a result, pump suppliers have seen orders go down by nearly 30 per cent.

However, growth opportunities exist in the water and power sectors as many governments in Europe are directing a majority of the stimulus package towards infrastructural development.

The increase in demand for pumps from the water and wastewater sector is attributed to the rising need for clean drinking water and proper sanitation in drought-affected regions such as Iberia, the UK and Italy.

Government regulations focusing on improving standards and efficiency drive the need for upgrading existing water and wastewater plants, especially in Eastern Europe.

Some key application areas offering opportunities are desalination and reverse osmosis.

Although desalination is considered a high-growth subsector, reverse osmosis has been gaining prominence during the recession because of its comparatively low cost of production.

In the power generation industry, the target of reaching higher energy output levels by 2012 is expected to drive demand for pumps both in terms of new equipment sales and upgrades.

An enhanced focus on third-generation fuels production offers long-term growth opportunities in this sector.

Currently, Western Europe leads the pump services market.

However, with new entrants such as Romania and Bulgaria, Eastern Europe is rapidly developing and attracting more foreign investments across various end users.

Lifecycle costing and energy efficiency are key factors that suppliers must focus on to last in this market during the recession.

Ravi said: ‘As customers strive to cut down production costs, focus has shifted from initial product cost to total lifecycle costs.

‘This, coupled with increasing energy prices, is boosting the adoption of energy-efficient pumps and systems,’ he added.

The trend is expected to enhance growth prospects for peristaltic pumps among the various positive-displacement pump types as it offers a relatively better lifecycle advantage to customers.

Similarly, rotary lobe pumps are preferred for hygienic applications due to the minimal contamination of the medium being pumped.

Technologies such as multi-phase pumping are expected to drive demand for screw and progressing cavity pumps.

In applications involving viscous fluids, positive-displacement pumps such as progressing cavity and screw pumps are likely to replace centrifugal pumps purely on the basis of energy efficiency.

Nonetheless, barring certain applications, centrifugal pumps still hold a major share of the total market.

Overall, the trend towards automation will provide mid- and long-term benefits for the European pumps market, with customers expecting increasingly sophisticated solutions.

Given the current economic scenario, factors such as supply chain, product portfolio, lead times, service network and regional presence are crucial for growth.

Although there is an inclination towards upgrades and maintenance, customers do not seem to be in favour of stocking products.

This leaves suppliers to focus on the ready availability of products and minimising lead times.

Extensive sales and service networks across the region will cater for this need.

In the short term, suppliers must focus on enhancing product-and-service portfolios through the addition of intelligent pumps, energy-efficient products and strategic services that enhance sustainability in this market.

Frost and Sullivan

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