The explosives industry is expected to benefit from strong commodity demand from China and India
Los Angeles, California (PRWEB) November 10, 2011
Over the five-year period to 2016, growth in revenue for the US Explosives Manufacturing industry is projected to remain moderate, reaching an estimated $2.3 billion by the end of the period and growing an average of 2.9% per year, according to IBISWorld, the nation’s largest publisher of industry research. With the exception of 2012, when revenue is expected to grow 5.1%, year-on-year growth rates are anticipated to be in line with those of the general economy. A key driver will be the level of activity in various mining and quarrying industries, particularly the coal mining industry, which is currently contending with a slowdown in electricity consumption and increases in alternative energy generation sources, including natural gas and hydroelectric power.
Since the invention of dynamite and the blasting cap, explosives have played a small but important role within the United States' economic development. They have performed a dominant role not only in shaping the nation's mining and minerals industries, but also in oil and gas exploration, power production and the construction of pipelines, tunnels and motorways. The US Explosives Manufacturing industry is a relatively small component of the nation's overall chemical sector, comprising roughly 45 enterprises and employing about 5,900 people.
With growing demand for base metals, minerals and coal driving increased mining activity, industry revenue is expected to grow 2.7% to $2.0 billion in 2011. Booming demand in prerecession years, however, inflate average annual industry revenue growth to 5.0% over the five years to 2011. Over the same period, the industry was characterized by consolidation activity and increased globalization. For example, the Australian chemicals and explosives firm Incitec Pivot Ltd. acquired the largest industry firm, Dyno Nobel, in 2008 for $2.7 billion. Over the five years to 2011, the total number of domestic industry firms is projected to decrease at an average annualized rate of 3.2%.
According to IBISWorld analyst, Brian Bueno, in 2016, the Explosives Manufacturing Industry is forecast to generate revenue of roughly $2.3 billion, which represents a five-year annual growth average of 2.9%. “In the near-to-long term, the industry is expected to benefit from strong commodity demand from China and India, which will help fuel a new commodities growth cycle,” says Bueno. Growth in value-adding explosives services (such as virtual blasting or product delivery) will continue to underpin growth in the industry, especially in mature market sectors, as well as provide a means for differentiation.
For more information, download the full report from IBISWorld on the Explosives Manufacturing Industry
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