Transformer oil: Key market research findings
- APAC dominates the market geographically
- Mineral-based segment accounts for a majority of the market’s revenue
- Key vendors – Apar Industries, Ergon Energy, Nynas, PetroChina, and Sinopec
Technavio’s market research analysts expect the global market for transformer oil to grow at a CAGR of around 9% between 2016 and 2020. The market’s growth can be accredited to recent T&D expansion and the resultant increase in transformer installations. Countries like China, Thailand, the Philippines, Vietnam, India, Japan, and Australia are witnessing extensive growth in their economies along with industrial development and commercialization. Due to these trends, demand for power in these countries is also increasing. During 2015, the APAC region accounted for almost 51% of the market share to dominate the global transformer oil market. The growth in electricity consuming sectors in this region is expected to fuel the demand for transformer oil in APAC during the forecast period.
The new market research report from Technavio presents a breakdown and analysis of the transformer oil segments based on the product.
“Transformer manufacturers are focusing their R&D efforts on the development of transformers that operate on non-mineral transformer insulating liquids. Major players like Siemens have increased their research on the development of alternative transformer insulating liquids as it is a step towards a safe and eco-friendlier future. Mineral oil is considered to be the most significantly used type of transformer insulating medium as well as a heat transfer medium. However, this type of fluid has several disadvantages, such as limited resources, limited biodegradability, and low combustion point,” says Anju Ajaykumar, Lead Analyst, Heavy Industry, Technavio Research.
By 2020, the mineral-based transformer oil segment will account for 90% of the market’s revenue to maintain its position as the key revenue generating segment in the global market for transformer oil. This is due to its widespread availability and also the large-scale manufacturing of transformers that operate using this insulating medium. The growth of this segment can be accredited to the wide-scale use of mineral-based transformer oil in power and distribution transformers, switchgear, and circuit breakers, especially in APAC. This oil is priced reasonably compared to other forms and is, therefore, popular among the cost-sensitive customers in the region.
The key vendors in the market include Apar Industries, Ergon Energy, Nynas, PetroChina, and Sinopec. The market comprises of a diverse group of international and regional transformer oil manufacturers and appears to be moderately fragmented. Most of the vendors lack product differentiation and mainly compete on the basis of product pricing and services. Moreover, the established vendors also face a threat from regional vendors who offer low-priced, customized solutions to customers. Since the market requires massive capital expenditure, the coming years will not witness the entry of many new vendors. The new entrants will also find it difficult to compete with the large established companies in terms of product quality, features, design, services offered, turnaround time, and maintaining customer relationships.
A more detailed analysis is available in the Technavio report, Global Transformer Oil Market 2016-2020.
We can customize reports by other regions and specific segments upon request.
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