Analyses on Development Factors of the Chinese Valve Industry (2)
The mid-range industrial valve market becoming more mature
The valve products on the mid-range industrial valve market are mainly the industrial valves made of carbon steel or the stainless steel, which are applied to the not very harsh working environments. The market demand for this kind of valve is very large, and all the valves on the mid-range industrial valve market must meet the quality requirements of the industrial standard. The industrial valve usually have high technical content, and the end customer of the industrial valve set the market entry barrier for the supplier, only the qualified supplier owning the qualification of entering the mid-range industrial valve market. The competition of the mid-range industrial valve market is lower than the low side valve market’s and the civilian valve market’s, and the profit of the mid-range industrial valve market is high. Some large valve enterprises in China have entered the international market for a long time. They have already been mature in the production technology and process, and have established the stable partnership with many international customers, which help them occupy advantageous positions in the mid-range valve market.
(1) The overall market concentration of the valve industry being low
There are a great number of valve enterprises worldwide, and the the overall competition is becoming more and more intense. From a global perspective, most of the world’s leading valve companies have entering the capital market and gone through the process of promoting and achieving the industry integration by utilizing the capital markets. In contrast, the overall scale of the domestic valve enterprise is too small, and even the leading valve enterprises have not entering the capital market. Lacking long-term financial support makes it difficult for them to achieve the industry integration.
(2) Most of China’s valve enterprises being in the low side valve market
The main valve products on the low side industrial valve market and the civilian valve market are the cast steel valves and the bronze valves. These two kinds of valves have large demand on the above mentioned two markets, but the technical content of these two kinds of valves is very low, which makes it easy for the valve enterprises to enter the market and makes the low side industrial valve market full of the small family valve manufacturers. The competition of the low side industrial valve market is the fiercest and the profit is relatively low. At present, 90% of the export-oriented valve enterprises are the valve parts manufacturers or the OEMs, and there are a great number of valve companies belonging to the low side industrial valve market and the civilian valve market.,
Source: China Valves Manufacturer – Yaang Pipe Industry (www.ugsteelmill.com)