Chipping & Grinding Equipment Manufacturing in the US Industry Market Research Report Now Available from IBISWorld

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Decline in residential construction as a result of the recession led to demand declines from the forestry sector, the main market for chippers and grinders. However, rebounds in forestry and increased demand for paper products have led to recent industry revenue growth. In addition, increased regulation regarding alternative energy sources will likely increase demand for biomass, which will positively influence demand for the industry's products. As a result, downstream markets are expected to increase capital investment in chippers and grinders in the coming years. For these reasons, industry research firm IBISWorld has added a report on the Chipping & Grinding Equipment Manufacturing industry to its growing industry report collection.

IBISWorld Market Research

IBISWorld Market Research

Rebounds in residential construction and forestry will lead the industry back to growth

The Chipping and Grinding Equipment Manufacturing industry faced adverse conditions during the five years to 2012. The industry manufactures commercial-use equipment that is primarily used to process wood into wood chips, wood shavings and sawdust. These products are mainly used by the forestry sector and recycling facilities to produce wood-based products for paper manufacturing, agricultural purposes, landscaping and energy sources. However, with the downturn in the residential and commercial construction markets, the forestry sector contracted sharply, limiting capital investment in industry machinery. The result was a sharp downturn in industry revenue during the recession. Over the five years to 2012, industry revenue contracted at an average annual rate of 3.4% to an estimated $374.3 million. “With the modest rebound in the forestry sector following the recession and greater demand for paper products, demand for wood chippers and grinders has begun to improve, leading to an estimated 8.9% revenue increase during 2012,” says IBISWorld industry analyst Caitlin Moldvay.

IBISWorld analysis reveals the Chipping and Grinding Equipment Manufacturing industry exhibits a high level of market share concentration. The top companies include Vermeer, Continental and Morbark. Beyond them, the remaining firms are estimated to be small independent companies manufacturing machinery on a local or regional scale. Industry concentration is forecast to increase in line with a falling number of companies. “In addition to ongoing hikes in steel prices that pressure operator margins and force inefficient firms out of business, merger and acquisition activity will likely occur as leading firms seek to expand their geographical reach,” says Moldvay.

Over the five years to 2017, industry revenue is forecast to rebound. The primary factor leading to greater industry demand will be improvement in the forestry sector, which will result in greater capital investment in chippers and grinders used by sawmills, logging companies and timber service providers. Furthermore, the industry will benefit from rising demand for biomass as an alternative energy source. This will boost demand for wood chippers and grinders, which can process pulp wood and discarded wood from landfills. Further regulations requiring utilities companies to increase usage of alternative energy, including biomass, will positively affect demand for the industry's processing equipment. For more information, visit IBISWorld’s Chipping and Grinding Equipment Manufacturing in the US industry report page.

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IBISWorld industry Report Key Topics

This industry manufactures large-scale chippers and grinders for trees, logs and other brush. These large-scale machines are capable of processing one whole tree at a time.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.

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Gavin Smith
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