Infrastructure Construction Triggers Huge Demand For Valve Market

From the perspective of scientific development, in order to ensure the need to improve people's lives and coordinate economic development in the future, China must give top priority to infrastructure construction, such as water, electricity, gas, and heat, which is exactly where Lined Valve comes in. In addition, there are many projects such as the South-to-North Water Diversion Project, the West-to-East Gas Transmission Project, the transformation of old industrial bases, urban pipe network construction, sewage treatment, residential projects, and farmland water conservancy, which will trigger huge demand in the valve market.

First of all, China's South-to-North Water Diversion Project, the amount of money used for valve procurement in the 70-kilometer distance from the suburbs of Beijing to the urban area alone is as high as tens of millions of yuan, so the demand for valves in the entire South-to-North Water Diversion Project can be imagined. Secondly, in order to solve the problem of electricity shortage, large-scale hydropower projects are not only the top priority of the Chinese government, but also a long-term task.

However, facing such a huge future market, how many orders can Chinese valve manufacturers get from it? In the competition with foreign capital, how big is their gap? These issues are probably what Chinese valve manufacturers are most concerned about.

In my country's current valve market, except for low-pressure valves that have reached the level acceptable to the international market, high-pressure valves still need to rely on imports. Under the situation of continued optimism in the macro-economy, the production and sales indicators of most enterprises in the valve industry have maintained rapid growth, but affected by the price war, the industry's sales revenue and profits have dropped sharply compared with the same period last year.

The gap in the overall industrial chain

As a mechanical equipment, valve production is at the downstream of the entire industrial chain, including the development level of industries such as steel, sealing materials, and mechanical processing, which will have an important impact on the technical parameters of the valve. The strength, ductility, and corrosion resistance of steel directly affect the valve's ability to resist high pressure and corrosion; the production level of sealing materials determines the medium applicable to the valve and the pressure it can withstand; the precision of mechanical processing is an important factor affecting the interface seal, valve head and valve seat sealing level.

The gap in the degree of specialization

As a general pipeline equipment, valves are widely used in many fields, including water conservancy and hydropower, urban pipelines, petroleum and petrochemicals, sewage treatment and many other industries. Due to the different conditions in working conditions, media, sealing, etc. in different industries and projects, the technical requirements for valve equipment models, materials, pressure levels, etc. are also different, which has also led to further market segmentation of valve equipment for different industries.

Gap in industrial structure

my country's valve manufacturing enterprises are too small and the industrial concentration is too low. According to data from Watts, there are currently more than 3,000 valve manufacturing companies in China, ranking first in the world. However, most of them are low-level, small-scale, and family workshop-style enterprises. There are less than 500 companies with annual sales revenue of 5 million yuan, and only a dozen companies with annual sales revenue of more than 100 million yuan. The total market share of the top 10 companies is only 8% to 9%. Due to the low industrial concentration, many unfavorable factors such as backward technology, low-price competition, and lack of influential brands have caused such a huge Chinese valve market to still have no real famous brands.

Gap in brand influence

According to data, many foreign valve manufacturers have significantly surpassed domestic companies in brand effectiveness in various professional fields. In the water treatment industry, power field, petrochemical industry, and high-pressure working conditions, some foreign brands have already established their leading position in the market. In this case, various valve manufacturers have chosen a professional development path. They are no longer satisfied with only producing a single valve equipment, but are committed to providing overall solutions for the entire project through product line expansion or seeking cooperation. The American Watts mentioned above is a typical representative. Initially, they only produced valves dedicated to the water treatment field, but now, they can even build a water plant independently.

As the world economy recovers, the import and export of my country's valve products has also increased, but because there is still a large gap in high-end technology compared with foreign manufacturers, product technology will become a bottleneck restricting the development of my country's valve products in the future.