Copper (Cu) Tubes Market in MENA, 2017

Copper (Cu) Tubes Market in MENA, 2017

11% Growth in HVACR Contributed by Smart Cities is a Key Driver

RELEASE DATE
11-Oct-2018
REGION
South Asia, Middle East & North Africa
Research Code: 9AB4-00-1C-00-00
SKU: CI00578-SA-MR_22429

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Description

Opportunity assessment of Copper tubes in MENA covers growth trends and future market potential for copper tubes in the fast growing HVAC segment. LME stabilisation of copper price has made copper tubes projects attractive and increased demand from the HVAC segment has led to OEM expansions. For a new market entrant, it is imperative to note that LME price of copper is very volatile and hedging is required to offset risk. Prudent project management for establishing new plants and new geographic entries is important to offset price fluctuations. OEMs expansion plans to meet attractive HVAC growth rates make this market an attractive entry option.

Table of Contents

Global copper tubes consumption expected to grow at 2% mainly driven by demand from housing and infrastructure development

Global Snapshot

Key Takeaways

Scope & Limitations

MENA Overview

Key Driver in MENA for Cu Tubes

Growth in Demand

Large pool of suppliers will assist the price sensitive MENA market to shift to renewable energy

Copper tubes will continue to be a major component of all cooling equipment in the long term; low threat of competition from substitute material in MENA

MENA has traditionally been an import dependent market; quality and price competitiveness are important criteria to be successful

LME accounts for 80% of cost component and has a direct impact on material carrying cost; copper remains the material of choice in MENA

Long term contracts exist for large OEMs; smaller producers procure 2MT MOQ

Large supplier base – differentiating factors are product quality, specifications, and brand image

Working directly and maintaining touch points with OEMs for product development will ensure higher returns

Successful Entry Strategies

Substitute Material—Aluminium Tubes Penetration to be “Low”, despite Copper’s LME Price Fluctuations

Copper continued to be in use despite LME price fluctuations; replacement threat with aluminium is low in MENA

Compactness and improved quality of ACR systems achieved with the Microgroove technology can make strides in future construction and infrastructure – increased consumption of Copper tubes

Consumption Driver 1

Consumption Driver 2—Mega Cities of the Future

Consumption Driver 3—Future Smart City Projects in the GCC by 2025

40% growth in air conditioner and refrigeration (ACR) due to smart city projects

Developments in GCC

Oil prices adversely impacted government budgets in 2016 and 2017; 5% VAT introduction in 2018 and 2019 as part of corrective measure

Decision Makers Spotlight—CEOs Perspective (1/2)

Decision Makers Spotlight—CEOs Perspective (2/2)

List of Acronyms Used

Maximize opportunities from existing products and markets; systematically explore new products, markets, including Inorganic Opportunities

Our Growth Consulting Canvas

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Related Research
Opportunity assessment of Copper tubes in MENA covers growth trends and future market potential for copper tubes in the fast growing HVAC segment. LME stabilisation of copper price has made copper tubes projects attractive and increased demand from the HVAC segment has led to OEM expansions. For a new market entrant, it is imperative to note that LME price of copper is very volatile and hedging is required to offset risk. Prudent project management for establishing new plants and new geographic entries is important to offset price fluctuations. OEMs expansion plans to meet attractive HVAC growth rates make this market an attractive entry option.
More Information
No Index No
Podcast No
Author Maya Abraham
Industries Cross Industries
WIP Number 9AB4-00-1C-00-00
Is Prebook No
GPS Codes 9B14