Big Shift In Process Equipment Markets In The U.S.

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Source: The McIlvaine Company

The market for process equipment, instrumentation, and services will slow in the traditionally strong regions of the South East, South Central and Pacific Regions.  Instead, the growth will be in the Midwest, North Central and Western regions.  This is the prediction resulting from findings in four McIlvaine publications including, World Market for Your Products, North American Analysis and Forecast, Biofuels Markets, and World Power Generation Projects.  Details are also available as a Market Analysis Webinar.

California and Texas have been the two top state markets for the process equipment and service providers.  The big growth of the chemical industry in Texas was a result of cheap natural gas.  The soaring price of natural gas will make this area unattractive for energy intensive industries.  A desperate move to quickly build coal plants has been effectively blocked by environmentalists.

California is on a path to make it the highest energy cost state and has been losing market share in the process segment for some time.

Ethanol is now the big growth market for process equipment.  This market is centered in the Midwest and North Central regions.  This same area is benefiting from a very big coal-fired power plant building program.  With the very extensive air pollution control equipment required in a modern coal-fired plant, the process equipment and service sales potential is an order of magnitude higher than that required for a gas-fired generation plant.

Iowa is the leading market for ethanol plants.  It also is experiencing activity in coal-fired boiler construction which is 2.3 times greater than that of the average state.  Illinois is the second largest ethanol plant market and has a coal-fired generator activity of 2.6 times greater than the average state.  Other states in the Midwest, North Central, and Western regions are also benefiting from both the ethanol and coal-fired activity.

The recent development which allows ethanol plants to utilize the waste heat from coal-fired plants will likely become popular.  This will further bolster the market in these three regions.

State                       Coal Activity Level                Ethanol Ranking

Illinois                                 2.6                                           2

Iowa                                   2.3                                           1

Montana                             1.6                                           -

Nebraska                            0.8                                           4

Nevada                               3.0                                           -

Kansas                                2.1                                           7

South Dakota                      0.6                                           5

Wisconsin                            1.1                                           6

Wyoming                             2.1                                           -

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