How do we understand the development trend of industrial valves?

1.The overall analysis of the industrial valve industry chain

Valves are important mechanical basic parts. Valve refers to a device that controls fluid flow, pressure and direction by changing the size of its flow channel. It is a control component in a fluid delivery system. Its functions include opening and closing, adjustment, and throttling. Valves are important mechanical basic parts. The upstream of the industry is industrial raw materials such as castings, forgings, seals, etc., which are in a state of full competition. The downstream is widely used in oil and gas, chemical industry, electric power, tap water and sewage treatment, papermaking, metallurgy, pharmaceuticals, food, etc. Mining, non-ferrous metals, electronics and other industries.

As far as the industrial valve industry chain is concerned, the upstream is mainly all kinds of raw materials, including plates, steel, castings and control components. The midstream is the production and manufacture of industrial valves. There are many types of valves, which are classified in various ways according to usage, engineering pressure, medium temperature, actuation and valve materials. The downstream is mainly the various application methods of industrial valves, including oil refining, chemical industry, electric power and wastewater.

Industrial valve industry chain map:

(1) Upstream materials

The overall production scale of castings in my country is relatively large, and the output has ranked first in the world for many years. According to data from the Foundry Industry Association, although the casting industry in 2019 was affected by the decline in the downstream automotive industry, it still maintained a huge output of nearly 50 million tons. In 2020, the output of castings continued to rise, reaching a new high of 51.95 million tons, an increase of 6.6 year-on-year. %. As a key component of industrial valves, castings have a stable upstream supply of raw materials, laying a solid foundation for the development of industrial valves.

(2) Downstream application structure

Valves are pipeline accessories used to open and close pipelines, control flow, adjust and control the parameters of the conveying medium. They are mainly used in oil refining, electric power, chemical industry, wastewater, steel and other fields, of which energy and chemical industries account for half of the total demand above. Valves are generally divided into gate valves, globe valves, throttle valves, ball valves, butterfly valves, etc. according to structural characteristics. Different types of valves account for a relatively fixed proportion of equipment investment, and there is less competition between each other.

2. The status quo of the industrial valve market

China is the world's largest valve demand market. According to Mcilvaine data, China's demand for valves accounted for 17% of the total global demand in 2018, making it the world's largest valve demand market. In 2019, the output growth rate of my country's valve industry rebounded. According to the data of China General Machinery Industry Association, the output of my country's valve industry in 2019 was 6,522,200 tons, a year-on-year increase of 34.11%.

Chinese valve manufacturers are mainly concentrated in Zhejiang, Jiangsu and Shandong. According to the China General Machinery Industry Association, the total revenue of China's industrial valve regulation enterprises in 2019 was 193.1 billion yuan, which was basically the same as the same period in 2018.

3. Valve market pattern

(1) Regional pattern

As far as the regional distribution of China’s industrial valves is concerned, major companies are located in coastal cities such as Shandong, Zhejiang, Shenzhen, Jiangsu, and Liaoning. Data show that valve manufacturers in these four provinces have revenues of more than 9 million. In addition, the transportation cost is relatively high. Low, conducive to the development of industrial equipment such as valves.

Schematic diagram of regional revenue distribution of industrial valve manufacturers:

2. Competitive landscape

The overall competition pattern of my country's valve industry is relatively fragmented, and the number of companies affected by the diversity of product types is large and the orientation of companies varies greatly. At present, the world's largest valve companies are mainly concentrated in developed countries such as Europe, the United States, and Japan, such as Emerson in the United States, KTIZ in Japan, etc. The leading companies in the overseas valve industry generally achieve product lines covering a certain downstream application field, so the market share is Economies of scale are higher. Most domestic valve companies generally choose one or several industrial fields as the focus of market development, so there is a certain gap in sales scale with foreign leading companies.

4. Development trend of industrial valves

(1) Stable growth is expected.

The market scale of China's valve industry has grown relatively smoothly. In 2018-2019, affected by factors such as Sino-US trade frictions and the decline in downstream demand, the industry's growth rate has declined. The valve industry will maintain steady growth in 2020. The valve branch of the China General Machinery Industry Association predicted in the January-February 2020 joint publication "Valve Association News" that the general machinery industry will continue to grow in 2020.

(2) The localization of the mid-to-high-end valve market brings growth opportunities for domestic valve companies.

The valve industry in China started relatively late, and there is a certain gap in the design, manufacturing, production and experimental testing capabilities of valves compared with developed countries, especially in the high-end valve market, some high-temperature, high-pressure, corrosion-resistant valves and special valves on key equipment There is still a certain degree of import dependence, and imported valves are mainly concentrated in the high-end market. Valves are important mechanical basic parts. In the context of Sino-US trade frictions, the autonomous controllability of valves for key equipment has become particularly important. With the release of guidance documents such as the "Several Opinions of the State Council on Accelerating the Revitalization of the Equipment Manufacturing Industry", The process of autonomy in China's mid-to-high-end valve market is expected to accelerate.

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