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Electric Resistance Welded (ERW) Pipes and Tubes - Global Market Trajectory & Analytics

  • ID: 2498178
  • Report
  • April 2021
  • Region: Global
  • 337 Pages
  • Global Industry Analysts, Inc

Collateral Damage of COVID-19 Spreads to ERW Pipes & Tubes, Eliciting a -10.6% Slump in Demand

The global market for Electric Resistance Welded (ERW) Pipes and Tubes is expected to slump by -10.6% in the year 2020 highlighting a 7.3 million ton erosion in consumption. Thereafter the market is expected to recover and reach 90.4 million tons by the year 2027 trailing a post-COVID-19 CAGR of 5.6% over the analysis period 2020 to 2027. The human cost of the pandemic is continuing to grow and is expected to deal an unprecedented blow to people, businesses and economies worldwide. Seven months into the pandemic, infections worldwide are continuing to spiral. Continuing lockdowns, labor shortages, mobility challenges, supply chain disruptions, financial distress and plummeting investments have impacted a bulk of construction activity worldwide. Diversion of government funds from infrastructure development to pandemic firefighting has additionally impacted the construction industry, which is dependent to a large extent on infrastructure projects. In several countries, all non-essential construction projects have been put on hold with the exception of building emergency hospitals for COVID-19 care. Residential construction is taking a beating with millions of people worldwide pushed into unemployment as businesses either go bankrupt or layoff workforce to stay afloat. Unemployment rates are climbing to worrisome levels in both developed and developing economies alike. The loss in consumer confidence and erosion of household wealth and discretionary spending will impact virtually every industry and business worldwide. With unemployment rates rising amid the virus induced economic crisis, consumers are cutting spending budgets. Social outlook against this background remains grim with households expected witness erosion in wealth. Personal financial outlook, community, economy, job security confidence, purchasing and investment confidence are all tumbling as the human and economic cost of the global pandemic rises. For the construction industry, this brings bad news as new housing starts go into deep freeze. The long shadow of the coronavirus is thwarting home-buying plans of consumers. With countries seeing a second wave of infections, the Covid-19 resurgence is likely to undermine the much awaited chances of a V-shaped recovery. Challenges of maintaining social distancing at construction sites is resulting in difficulties in obtaining project clearances from regulatory authorities. Ensuring raw material availability still remains a challenge for most construction contractors.

The shattered oil & gas industry is facing its worst ever crisis, an overstocked supply market and a steep decline in demand. Choking economic activity over the last few months is sending shockwaves of disruption through the industry. From prices dipping to subzero to oil producers in the first time in history having to pay to dispose excess stocks, the industry has seen the worst. In this crisis of unimagined magnitude, CAPEX spending is worst hit. As business confidence plummets rapidly, major oil companies have already slashed planned CAPEX spending by almost US$89 billion in 1st quarter 2020. Travel bans, manufacturing shutdown of all non-essential plants, closure on offices have wielded the most severe demand shock. A mistimed price war between Russia and Saudi Arabia following Russia`s decision to pull out of a joint production cut agreement additionally aggravated the demand supply imbalance. China in early February during the heat of the pandemic banned entry of oil tankers while tightening the lockdown measures. OPEC talks to cut back on production failed as Russia refused to cooperate. Saudi Arabia during this period offered US$6 to US$9 discount per barrel for European, Asian, and U.S customers. Currently for most oil giants worldwide higher prices are needed to breakeven. Breakeven prices for Saudi Arabia, UAE, Iraq, Azerbaijan, Kuwait, Kazakhstan, and Russia include US$85, US$65, US$64, US$51, US$49, US$42, and US$40 respectively. As a culmination of these factors, the world witnessed negative oil prices become a shocking reality. As rising stockpiles overwhelmed storage facilities, the amount of oil stored on massive tankers on sea skyrocketed to over 160 million barrels in April 2020 as compared to the less than 100 million in April 2009 during the Great Recession. The entire O&G value chain is feeling the pain as upstream, midstream and downstream operations collapse under a domino effect. Under this scenario, demand for ERW Pipes & Tubes is expected to decline.

Post COVID-19, Here`s How Market Growth Drivers Will Regroup

In the post COVID-19 period, refocus on infrastructure projects such as water and sewage systems and oil and gas pipeline networks will help bring growth back. Recovery in oil prices from the prolonged slump and a parallel improvement in spending on exploration and production (E&P) activities will brighten the outlook for oil pipeline infrastructure projects. Few of the benefits driving the preference for pipelines as a transport and distribution mechanism to get oil-to-market include cost effectiveness as it is decupled from transport fuel prices; safer and easier to transport; more reliable than rail or road; ensures stable supply to remote areas with inadequate road connectivity; eliminates the risk of pilferage, spills and wastage; reduced risk of environmental disasters; consumes less energy and has a relatively smaller carbon footprint compared to rail, road or ship transport; proposed pipeline projects are cheaper than the expansion of road transportation infrastructure. Other major factors which will driving growth include aging water, sewage and gas pipeline infrastructure in developed countries and the ensuing need for replacements and upgrades; shale gas exploration growth in North America and the ensuing demand for high strength casing pipes; rapid industrialization in developing countries and the ensuing need for pipeline constructions in new industrial facilities; pressure applications in boilers and oil stills and the ensuing demand for pressure tubings; growing opportunity for ERW Pipes in agriculture in line with the increased adoption of micro irrigation methods; growing concerns over water shortages and the ensuing focus on efficient water management and distribution. Hazardous operation of liquid and natural gas transmission pipelines will encourage governments worldwide to develop and implement comprehensive pipeline integrity management programs including mandatory continuous assessment of pipelines, which is expected to fuel replacements and upgrades. Asia-Pacific will remain a key market supported by the emphasis on smart city initiatives, growing population and increased demand for infrastructure that ensures optimum distribution of resources such as electricity, energy, and water. Densely populated urban cities are also driving demand for underground carriage systems for transporting sewage from buildings and homes. In the United States growth will come from government policy focus on remedying the country`s crumbling infrastructure.

Select Competitors (Total 118 Featured):

  • Al Jazeera Steel Products Company SAOG
  • APL Apollo Tubes Limited (APL)
  • Arabian Pipes Company
  • ArcelorMittal SA
  • ChelPipe
  • Choo Bee Metal Industries Berhad
  • EVRAZ North America
  • JFE Steel Corporation
  • Maharashtra Seamless Limited
  • Nippon Steel & Sumitomo Metal Corporation
  • PAO TMK
  • PT Bakrie Pipe Industries
  • Salzgitter Mannesmann Line Pipe GmbH
  • Surya Roshni Ltd.
  • Tata Steel Europe
  • Techint Group SpA
  • Ternium S.A.
  • Tenaris S.A.
  • TenarisSiderca (Siderca S.A.I.C.)
  • United States Steel Corporation
  • United Metallurgical Company /OMK
  • Welspun Corp Ltd.
  • Wheatland Tube Company
Note: Product cover images may vary from those shown
I. METHODOLOGY

II. EXECUTIVE SUMMARY

1. MARKET OVERVIEW
  • Influencer Market Insights
  • World Market Trajectories
  • Impact of Covid-19 and a Looming Global Recession
  • Exhibit 1: Global Reduction in CAPEX (in %) by Industry for FY2020
  • Exhibit 2: World Economic Growth Projections (Real GDP, annual % Change) for 2019, 2020 & 2021
  • Exhibit 3: Global PMI Index Points for the Years 2018, 2019 & 2020
  • Impact on ERW Pipes
  • COVID-19 Creates Supply-Demand Crisis in Oil and Gas Industry
  • Exhibit 4: Global Brent Crude Oil Price Trends in US$/barrel: May 2019 -June 2020
  • Exhibit 5: Global Daily Crude Oil Demand in Million Barrels for the Years 2015 through 2020
  • Global E&P Industry Revenues Set to Drop Significantly amidst COVID-19 Pandemic
  • Global Oil & Gas E&P Industry Spending (2015-2021E)
  • Russia and OPEC Plus Allies Pledge to Curb Oil Production to Prevent Oil Market from Collapsing
  • Electric Resistance Welded (ERW) Pipes & Tubes: An Introduction
  • Production of ERW Pipes
  • Types of ERW Welding Processes
  • Applications/Uses of ERW Pipes
  • Classification of ERW Pipes
  • Outlook
  • Recent Market Activity
2. FOCUS ON SELECT PLAYERS

3. MARKET TRENDS & DRIVERS
  • Rig Counts and Drilling activity Trends Define the Demand for OCTG Pipes
  • Exhibit 6: World Average Rig Count by Region: 2020 (1H)
  • Exhibit 7: World Average Rig Count by Region (2015-2019)
  • Exhibit 8: Global Rig Count by Region (20201H): Percentage Share Breakdown of Average Rig Count
  • Unconventional Oil & Gas Resources Trigger Demand for High Grade OCTG Products
  • Deep Water Drilling Offer New Growth Opportunities
  • Growth in Pipeline Projects to Drive the Demand for Line Pipes
  • Tough Operating Environments Drive Demand for High Quality Line Pipes
  • Shale Plays Drive Demand for High Strength Pipes
  • Exhibit 9: Technically Recoverable Shale Gas Resource (in tcf) by Country
  • Aging Pipelines Drive Replacement Demand
  • Prospects in Manufacturing Sector to Shape Growth
  • Global Manufacturing PMI Index Score January 2020 to May 2020
  • Mechanical Tubing Market Prospects
  • Anemic Improvement in Automotive Industry Supports Demand
  • Exhibit 10: World Automobile Production in Million Units: 2008-2022
  • Exhibit 11: Automobile Production % YoY Change Across Select Countries: 2020 Vs 2019
  • Revival in the Construction Sector to Lend Opportunities
  • Exhibit 12: Global Construction Spending (In US$ Trillion) for 2019, 2020 & 2021
  • Pressure Application to Drive Demand for Pressure Tubings
4. GLOBAL MARKET PERSPECTIVE

III. MARKET ANALYSIS
  • UNITED STATES
  • Market Overview
  • Oil & Gas Sector Dynamics Alter the Demand for OCTG and Line Pipes
  • Exhibit 13: Domestic Production of OCTG Pipes: Percentage Share Breakdown by Type, Welded & Seamless
  • Exhibit 14: US Crude Oil Production in Mbpd: 2010-2020P
  • Exhibit 15: US Monthly Rig Count: 2020 (January-June)
  • Exhibit 16: Oil and Gas Drilling Rigs Count* in the US (2011-2018): Breakdown of Average Number of Rigs for Oil Rigs, Gas Rigs, and Others
  • Exhibit 17: Oil and Gas Drilling Rigs Count in the US (2015-2020): Percentage Breakdown of Number of Rigs for Land-Based Rigs and Offshore Rigs
  • Increasing Complexity of Drilling Activity Holds Opportunities for OCTG Tubes
  • Exhibit 18: Conventional Vs. Unconventional Shale Gas Drilling in North America
  • Exhibit 19: Oil and Gas Drilling Rigs Count in the US (2015-2020): Percentage Share Breakdown of Average Number of Rigs for Directional Rigs, Horizontal Rigs, and Vertical Rigs
  • Exhibit 20: The US OCTG Consumption Per Rig 2013 -2019
  • Shale Plays Transforms US Energy Mix
  • Exhibit 21: Annual Production of Shale Gas (In Trillion Cubic Feet) in the US for 2010-2040
  • Natural Gas Exports Drive New Pipeline Constructions
  • Exhibit 22: U.S. Natural Gas Pipeline Exports to Mexico (Billion Cubic Feet): 2010-2020*
  • Replacement Market Holds Strong Potential
  • Water Infrastructure Development Drives Demand for Pipes
  • Important Water Infrastructure Projects Underway Amidst Coronavirus Crisis
  • Manufacturing Sector: An Important Market for Mechanical Tubes
  • Revival in Construction Industry Post Covid-19 to Improve Prospects
  • Exhibit 23: NAHB/Wells Fargo Housing Market Index: July 2019 - July 2020
  • Exhibit 24: Residential Construction in the US (Jan 2020-June 2020): Number of Housing Starts in Thousand Units by Type for Single-Family Units and Multi-Family Units
  • Exhibit 25: Residential Construction in the US (2008-2019): Number of Housing Starts in Thousand Units by Type for Single-Family Units and Multi-Family Units
  • Competitive Landscape
  • Market Analytics
  • CANADA
  • Oil & Gas Industry : A Review
  • Exhibit 26: Canadian Monthly Rig Count - 2020 (Jan-May)
  • Exhibit 27: Canadian Average Rig Count: 2016-20201H
  • Remote Location of O&G Reserves Drive the Need for New Pipeline Infrastructure
  • Market Analytics
  • JAPAN
  • Market Overview
  • CHINA
  • Market Overview
  • Production Scenario
  • Exhibit 28: Chinese Seamless Pipes Market (2019): Percentage Share Breakdown of Production Volume for Welded Pipes and Seamless Pipes
  • Energy Needs to Drive Demand
  • Exhibit 29: China Primary Energy Consumption by Source: 2019 & 2040
  • Market Analytics
  • EUROPE
  • Market Overview
  • Exhibit 30: Construction Industry in Europe - Year-on-Year (YoY) % Change in Construction Output for the Period 2014 through 2021E
  • Market Analytics
  • FRANCE
  • GERMANY
  • ITALY
  • UNITED KINGDOM
  • SPAIN
  • RUSSIA
  • Market Overview
  • Russian Oil Output Experiences Major Setback from COVID-19 and Global Supply Agreement
  • Exhibit 31: Crude Oil Production in Russia (2018-May 2020) (in Million Barrels Per Day)
  • Exhibit 32: Drilling Activity in Russia (2011-2019): Percentage Breakdown by Horizontal Drilling vs. Vertical Drilling
  • Drilling Complexity Drives Demand for High-Value Products
  • Opportunities from Exploration of Untapped Oil & Gas Reserves
  • vGreenfield Oil Projects to Boost Demand for Line Pipes
  • Exhibit 33: Oil Production in Russia (2020,2025, 2030): Percentage Share Breakdown of Production Volume by Brownfield and Greenfield Projects
  • Competitive Landscape
  • Exhibit 34: Leading Manufacturers of Welded Line Pipes in Russia (2019): Percentage Share Breakdown of Sales for TMK, and Others
  • Exhibit 35: Leading Manufacturers of Welded Industrial Pipes in Russia (2019): Percentage Share Breakdown of Sales for TMK, and Others
  • Market Analytics
  • REST OF EUROPE
  • ASIA-PACIFIC
  • Oil & Gas industry in Asia Faces Uncertainty amid COVID-19 Pandemic
  • Market Analytics
  • INDIA
  • Market Overview
  • Drop in Construction Sector to Impact Demand for ERW Pipes
  • Long-term Prospects
  • Escalating COVID-19 Pandemic to Cripple Indian Demand for Petroleum Products
  • Water and Irrigation Infrastructure Development to Benefit Pipe Manufacturers
  • International Projects: Opportunity for Pipe Manufacturers
  • Decline in Automotive Industry to Impact Demand
  • Exhibit 36: Quarterly Automobile Sales in India in Million Units: FY 2018 - FY 2020
  • Market Analytics
  • SOUTH KOREA
  • REST OF ASIA-PACIFIC
  • LATIN AMERICA
  • COVID-19 Pandemic Set to Dampen Investment in Oil & Gas Industry in Latin America
  • Exhibit 37: Rig Count in Latin America: 2020 Jan-June
  • Exhibit 38: Average Rig Count in Latin America (2011-20201H)
  • Market Analytics
  • REST OF WORLD
  • Market Overview
  • OCTG Pipes Scenario
  • Exhibit 39: Average Rig Count in the Middle East: 2016-20201H
  • Adoption of Desalination Technology to Drive Pipeline Infrastructure
  • Construction Sector in the Middle East
  • Market Analytics
IV. COMPETITION
  • Total Companies Profiled: 118
Note: Product cover images may vary from those shown
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