Steel Pipes & Tubes Market Growth & Trends
The global steel pipes & tubes market size is anticipated to reach USD 231.1 billion by 2027 registering a CAGR of 6.2%, according to a new report by Grand View Research, Inc. Long-term demand for energy on the global level is anticipated to boost the market growth. According to the EIA, global energy consumption is projected to reach 736 quadrillion BTU by 2040 from 575 quadrillion BTU in 2015, witnessing an increase of 28%. The use of liquid fuels and petroleum is likely to grow from 90 million b/d in 2012 to 1000 million b/d by 2040 on a global level. The growth in demand for these liquid fuels is mainly due to the industrial and transportation sectors.
Steel tubes are used in different applications in the oil & gas sector, wherein they are used in conveyor belt rollers, concrete pilings, and bearing casings. Dimensions including straightness, roundness, diameter, and wall thickness are crucial while selecting steel tubes in the oil & gas sector. The oil & gas application segment is anticipated to remain the dominant application segment over the forecast period. However, with the emergence of the global pandemic, the prices of crude oil tumbled, which directly impacted the industry. In addition, due to the imposed lockdowns and shutdowns, the global oil rig count plummeted over the first quarter of 2020, thereby leading to a decline in demand for steel pipes & tubes.
As per the stats released by Baker Hughes, the global rig count in March 2020 was evaluated around 1,964 as compared to 2,213 in March 2019, a year on year (Y-o-Y) decline of nearly -11.3%. The emergence of coronavirus is projected to severely impact the dynamics of the industry over the short-term period. The key application segments including oil & gas, automotive & transportation, chemicals & petrochemicals, and others are projected to observe a negative trajectory in FY 2020 owing to the weakening of macro-economic factors and industrial operations.
Despite the rising content of steel in vehicles, the overall dynamics of the global automotive sector are under severe distress since 2018. Reducing sales volume coupled with weak macroeconomic trends led to the decline in production rate from 2018 to 2019. Since then, the dynamics of the global automotive sector further dampened with the emergence of COVID 19. Reduced production of automotive vehicles is likely to directly impact or restrain the growth of the global steel pipes & tubes industry.
Steel Pipes & Tubes Market Report Highlights
- ERW segment is projected to witness a growth rate of 6.1% from 2020 to 2027, in terms of revenue, on account of low price and modest performance of this technology
- Oil & gas accounted for the highest market share and is projected to register a significant CAGR during the forecast period
- The increasing number of oil rigs and consistent demand for petroleum products is the main contributing factor for the growth of the oil & gas segment
- North America is projected to record the second-fastest CAGR of 6.0% from 2020 to 2027, in terms of revenue
- Growing drilling activities and automotive sectors are likely to push the product demand in the North America regional market
- The global market is fragmented in nature with the presence of several global and regional companies operating in different parts of the world
- In 2018, ArcelorMittal invested in a new cut-to-length line for precision tubes in Karvina, Czech Republic. They are also investing in capacity expansions to meet the growing product demand