The improving economic climate is expected to maintain the price growth for pipeline inspection services
Los Angeles, CA (PRWEB) October 21, 2014
Pipeline inspection services have a buyer power score of 3.1 out of 5, which indicates moderate purchasing power for buyers. Although small-size suppliers dominate the market, there is also a significant level of market share concentration, which generally restricts buyer power. In addition, the highly specialized nature of pipeline inspection services limits the availability of substitutes, which leaves it up to the vendors' discretion to dictate prices. Alternatively, vendors are financially stable, which minimizes buyers' risk. Furthermore, according to IBISWorld procurement analyst Agiimaa Kruchkin, “the price of pipeline inspection services has risen at a relatively slow rate during the past three years while price volatility has remained low, which has provided relief to buyers.”
The price of pipeline inspection services is expected to increase steadily during the three years to 2014, largely on the back of external demand drivers. Namely, rebounding industrial production and higher construction value have supported the growth in pipeline inspection service prices. As industrial activity picked up following the recession, demand for mined commodities, crude oil and natural gas, all of which are transported via pipelines, has mounted. This trend, in turn, stimulated demand for pipeline construction activity as well as for pipeline maintenance services, which include routine inspections. “On the back of recovering downstream demand, service prices have expanded. In the meantime, input cost drivers such as wages and overhead costs have increased moderately, driving up vendors' operating costs, which has further supported the upward trend in service prices.
In the next three years, demand for pipeline inspection services is projected to remain strong, primarily due to the expected growth in the oil drilling, natural gas extraction and mining sectors. However, price increases for these inspection services are anticipated to stay slow and steady, which will maintain buyer power. Because prices are still increasing, buyers can enter into long-term contracts with suppliers to lock in current prices during the term of the agreement.
For more information, visit IBISWorld’s Pipeline Inspection Services procurement category market research report page.
Follow IBISWorld on Twitter: https://twitter.com/#!/IBISWorld
Like IBISWorld on Facebook: http://www.facebook.com/pages/IBISWorld/121347533189
IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of pipeline inspection services. Suppliers assess the condition of pipelines via in-line inspection tools, such as pipeline pigs, as well as using nondestructive testing methods. These assessments include measurements of wall thickness in cast-iron, ductile-iron and steel pipelines, which are used to transport a variety of products, including crude oil, natural gas, ores, coal and water. Pipeline inspection services help buyers identify internal and external corrosion, cracking and manufacturing flaws. Vendors offer a variety of inspection services, including visual, X-ray, magnetic particle and ultrasonic methods, among others. This report excludes interior pipeline inspection equipment.
Recent Price Trend
Product Life Cycle
Total Cost of Ownership
Supply Chain & Vendors
Supply Chain Dynamics
Supply Chain Risk
Market Share Concentration
Buying Lead Time
Key RFP Elements
Buyer Power Factors
About IBISWorld Inc.
IBISWorld is one of the world's leading publishers of business intelligence, specializing in Industry research and Procurement research. Since 1971, IBISWorld has provided thoroughly researched, accurate and current business information. With an extensive online portfolio, valued for its depth and scope, IBISWorld’s procurement research reports equip clients with the insight necessary to make better purchasing decisions, faster. Headquartered in Los Angeles, IBISWorld Procurement 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.