Get a Grip on the Industrial Market and Prepare for 2022

Researched by Industrial Info Resources (Sugar Land, Texas)--This year has been a follow-up to the global slowdown and economic recession brought about in 2020 by the onset of the COVID-19 pandemic. While economic growth and industrial project activity are accelerating, headwinds remain: A new COVID variant has become dominant. Semiconductors are in short supply. Crude oil producers and refiners are becoming increasingly edgy about the outlook for fuel demand because of a rise in COVID-19 cases in the near term, and the energy transition in the long term. Industrial Info can help you better prepare for the future by gaining an understanding of what is planned for 2022.

Industrial Info's Plant and Project business intelligence, complimentary webinars and outlooks, and broad range of analytics products, available off the shelf or customized to your needs, can help you navigate the currents of change.

Industrial Info can help you learn about the trends, market drivers and big questions facing today's industrial sectors. Throughout the world, Industrial Info is tracking details of more than 197,000 active projects, worth nearly $16 trillion, and 250,000 operational plants. Projects with a combined worth of $2.9 trillion and 79,000 plants are in North America.

Oil & Gas - The Oil & Gas sector suffered at the onset of the pandemic, with product demand drying up, causing several related projects to be placed on hold or cancelled. However, Industrial Info has seen about a 10% growth in spending from January in the upstream, midstream and downstream markets. The industry is looking for ways to become more "green," and much of the activity in these markets is for projects such as carbon capture and storage (CCS) technology and, in the downstream sector, renewable fuels.

A number of liquefied natural gas (LNG) production trains came online last year in the U.S., although no new construction was started. LNG exports took a dive last year, but are expected to rise by more than 3 billion cubic feet this year. Soaring Asian demand is causing a boost in feed gas to LNG production facilities. While only one North American LNG project reached a positive financial investment decision (FID) last year, the door is open for FIDs on additional projects this year.

However, uncertainty clouds the industry, with a rise of COVID-19 cases and uncertainty about future demand.

Industrial Info is tracking more than 20,500 active projects throughout the world in the Oil & Gas Production, Terminals and Pipelines industries, and 27,400 operational plants.

Chemical Processing - Most of the Chemical Processing Industry is closely tied to the consumer, and the pandemic has changed the industry significantly as the use of chemicals for packaging and electronic devices has risen greatly. The industry is enjoying high margins for plastics such as high-density polyethylene and linear low-density polyethylene. Growth in traditional sectors such as housing and agriculture also remains strong.

The construction of large, world-scale chemical projects was in full throttle in 2018 and 2019, but these projects took a severe hit as COVID-19 took hold of the world in 2020. While there are some world-scale projects being planned, Trey Hamblet, Industrial Info's vice president of research for Chemical Processing, expects the bulk of these projects will be moved into future years, to 2023 and beyond.

Power-to-X projects are becoming increasingly prevalent. These can not only develop green hydrogen from renewable energy but also can be used for further downstream products such as green ammonia and green methanol. Industrial Info is tracking about $64 billion of projects across the world in this developing sector.

Industrial Info's chemical forecast analyzer allows users to view all chemical activity over the next five years by country, drill down to North American market regions, or even view activity by industry sector. This forecast provides subscribers a dynamic market forecast using project spending intelligence to estimate market spending for the Chemical Processing Industry. Click here for more information.

Industrial Info is tracking nearly 24,000 active Chemical Processing projects, valued at $1.5 trillion, and 22,200 operational plants.

Food & Beverage - While the Food & Beverage Industry is facing some supply constraints, these are not expected to greatly hinder capital spending. The pandemic drove major spending in the at-home consumption sector, but the hospitality industry is regaining ground as more people travel and feel comfortable going out. Big trends include alternative foods from plant-based ingredients in the meat and dairy sectors. Randy Godet, Industrial Info's vice president of research for Food & Beverage and Pulp, Paper & Wood, says the growth of alternative foods is one is of the biggest changes in the industry and is expected to continue for years to come. Industrial Info is tracking 16,800 active Food & Beverage projects, worth $248 billion, across the world.

Pulp, Paper & Wood - The outlook for the Pulp, Paper & Wood Industry was strong at the start of the year and has remained so. Primary drivers are demand for paper and paperboard products. Certain products are in short supply even with manufacturing plants running at full capacity, opening the door for future capital expenditures. Demand also is strong for packaging materials as online shopping increases.

The construction sector is creating strong demand for wood products, and companies in this sector are expected to move forward with planned expenditures. Twelve new grassroot projects are planned in the North American wood sector this year. "Much of that capacity coming online will go toward the construction market, which is being driven by the housing market," says Godet. Strong spending is expected for the remainder of this year and 2022, perhaps moving into 2023.

Industrial Info is tracking more than $152 billion in Pulp, Paper & Wood projects across the globe.

Power - The U.S. is in a cycle of coal-fired and nuclear retirements as new natural gas and renewable energy buildouts occur. Industrial Info has identified 194 gigawatts (GW) of power units that have retired in North America since 2011, mostly coal-fired plants, representing about 106 GW. This year is expected to have a record amount of nuclear retirements. in the U.S. About 7 GW of nuclear power is expected to retire between now and the end of 2025. Most of the baseload capacity has been replaced by natural gas, which experienced unprecedented buildouts a few years ago, although this has slowed recently, and the buildout now has shifted toward wind and solar power.

Solar power is outpacing everything else in regard to new-build projects. Britt Burt, Industrial Info's vice president of research for the Power Industry, says about 16 GW of solar power is expected to come online this year in North America and 18 GW in 2022. Drivers of solar investments include national, state and company goals to decarbonize, and federal tax incentives. Solar power also provides a promising future for Power-to-X project opportunities. Wind power is also strong. Burt said Industrial Info is tracking about $6 billion in North American wind projects under construction, with about $35 billion earmarked for kickoff this year and next. Across the world, Industrial Info is tracking more than 56,000 active power projects of all types, worth more than $7 trillion, and 53,500 operational plants.

Industrial Info offers a range of analytics products focused on the Power Industry, including our Global Power Generation Forecast by Country, U.S. Transmission & Distribution Forecast Analyzer and U.S. Combustion Turbine Predictive Maintenance Cost Analyzer, among others.

Pharmaceutical-Biotech - The effects of COVID-19 on the global Pharmaceutical-Biotech Industry have been dramatic and seem here to stay. Industrial Info is tracking more than $11 billion in active COVID-related projects, more than half of which have a future kickoff date. In addition, COVID-19 has had a knock-on effect for demand for medications for other medical conditions; at the height of the pandemic, people were hesitant to seek medical treatment, causing these conditions to get worse over time.

Industrial Info is tracking more than 650 Pharma-Biotech projects, valued at $47.9 billion, that are under construction in North America, with a great deal of activity occurring in the U.S. Northeast, New England and Mid-Atlantic market regions. Among the trends being seen is the rise in projects by contract manufacturing organizations (CMOs) and contract development and manufacturing organizations (CDMOs), which serve other companies across the drug chain--from development through manufacturing. Industrial Info is tracking more than $247 billion worth of Pharma-Biotech projects worldwide.

Industrial Manufacturing - All things considered, the Industrial Manufacturing Industry made it through 2020 in relatively good shape. According to David Pickering, Industrial Info's vice president of research for the industry, across the world, spending in the industry declined by about $20 billion, which is relatively modest on a global scale. He views 2021 as a recovery year as sectors make adjustments to a changed world, with spending more or less at pre-pandemic levels next year.

Hotspots are data centers as more and more people turn online to learn, shop and socialize. Related to online shopping is a high buildout in distribution and warehouse facilities, especially from e-commerce giant Amazon.com Incorporated (NASDAQ:AMZN) (Seattle, Washington).

According to Pickering, projects in the semiconductor sector typically operate in 5- to 6-year cycles, where projects are developed as new technologies emerge. However, a global shortage of semiconductors has given this sector an artificial boost. In the spring of 2020, as COVID-19 grabbed hold of the world, chip demand declined and manufacturing closures occurred. However, by early summer, demand began to increase, especially as the world embraced the stay-at-home ethos. At industrial plants, new technologies were implemented, further driving up demand.

According to Goldman Sachs (NYSE:GS) (New York, New York), 169 sectors have been affected by the shortage, which has caused companies to boost semiconductor projects as they attempt to fill the gap. However, these projects take about 12 to 18 months to implement, so the shortage is expected to last into next year and possibly into 2023.

Across the world, Industrial Info is tracking nearly 25,000 active Industrial Manufacturing projects, valued at $1.9 trillion.

Metals & Minerals - Buoyed by strong GDP growth across the world, metals prices have been rising this year, with steel prices in the U.S. tripling. But other factors are driving project activity in the Metals & Minerals Industry, such as environmental, social and governance (ESG) policies. Joe Govreau, Industrial Info's vice president of research for Metals & Minerals, says: "Decarbonization, electrification and productivity initiatives will continue to drive project spending as the North American market looks to increase metals and minerals supply in this age of energy transition."

Not only is the energy transition driving the production of metals and minerals needed for alternative forms of energy, but it is changing the way metals and minerals companies operate, with decarbonization initiatives being taken by several companies. Examples of activity in this area include the conversion of diesel-fueled mining trucks to battery-powered vehicles.

Industrial Info saw an 8.3% increase in North American Metals & Minerals project activity from the start of 2021 through mid-July, much of this due to activity in the steel sector. Project realization rates are expected to increase this year, and Govreau forecasts about $18.3 billion in North American spending for 2021, decreasing somewhat in 2022.

Industrial Info is tracking 31,500 active Metals & Minerals projects, valued at $2 trillion across the globe, and 35,000 operational plants.

Industrial Info's Global Mining Industry Forecast provides access to capital and maintenance spending estimates for 11 mining categories. Subscribers can analyze past, present and future spending for a 10-year view, five years forward and five years historical. Click here for more information.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.