How Saudi Arabia Plastic Pipes and
Fittings Market is Positioned?
Saudi
Arabia Plastic Pipes and Fittings Market
is at its late growth stage. The market growth has stagnated as the decrease in
oil prices has impacted the demand of plastic pipes and fittings in the country
and there were not a lot of infrastructure opportunities coming up in the
recent years. The market is highly correlated with the development in the
infrastructural, mining and construction of new house dwellings in the country.
There has been a trend of substituting PVC pipes and fittings by PE pipes and
fittings in potable water distribution applications and by PPR pipes and
fittings in internal plumbing application in the past few years. The water
supply and sewage end use application continues to be the leading end user
application in the market. The market is concentrated with few organized
players dominating the market.
Saudi
Arabia Plastic Pipes and Fittings market augmented positively from 2012 to 2017
at a positive CAGR during the review period 2012-2017. The organized sector
dominates the market due to its superior product quality and enjoys competitive
advantage over the unorganized sector as it can provide product customization.
Government schemes such as Vision 2030 to emphasize on developing sectors such
as transport and logistics, boost private sector contribution to the economy
and transformation of the government’s Public Investment Fund (PIF) into a USD
2 trillion sovereign wealth fund have contributed majorly to the market. There
has also been a shift in consumer preference from steel pipes to plastic pipes
for various industrial uses as it is a more economical option.
Saudi Arabia Plastic Pipes and
Fittings Market Segmentation
By Type of Pipe
In
2017, UPVC pipes and fittings continued to be the most prevalent product
followed by CPVC and PVC pipes, PE and others including PPR, ABS and PVDF pipes
in terms of revenue in the Plastic Pipes and Fittings market in Saudi Arabia.
The demand for PVC pipes and fittings has been reducing continuously because of
the increase in application areas of PE and PPR pipes and changes in consumer
preferences. This trend is anticipated to continue in the next five years as
well.
By Type of Market Structure
In
2017, the organized players which consist of those companies which have their
own production capacity in the country and can produce in huge volumes occupied
a major market share in terms of revenue in the overall market. This is because
the big organized players enjoyed competitive advantage over small unorganized
players on the basis of product customization, availability of credit facility,
product innovation and better quality products.
By Type of End User Application
In
2017, Water supply and Sewage contributed the highest share to the Plastic
Pipes and Fittings market of Saudi Arabia. This was because of the new
construction activities, real estate development and also the alteration,
conversion and renovation activities on-going in the country. This was followed
by the plumbing sector, other applications such as oil and gas transmission,
cable protection, healthcare and automotive industries, chemical and oil
industries and Irrigation in terms of revenue.
Competitive Landscape
Saudi
Arabia plastic pipes and fittings market is concentrated with the presence of
few big players constituting majority of the market. Saudi Plastic Products
Company Ltd (SAPPCO), Saudi Basic Industries Corporation (SABIC), New Products
Industries Co Ltd. (NEPROPLAST), Arabian Gulf Manufacturers Ltd (AGM), Al
Watania Plastics, Munir Munif Plastic Factory (MMP) and Almona Plastic Product
Company Ltd. Co. are the major players in the market. These big and established
players compete with the other unorganized players on the basis of product
customization, availability of credit facility, better information about the
various products in the market, product innovation and better quality products.
Future Outlook and Projections in the
Saudi Arabia Plastic Pipes and Fittings Market
The
future outlook of the industry is positive because as the oil prices are
expected to recover in the coming years, it will give a boost to the Saudi
Arabia economy and the construction industry would continue to expand with
investments in infrastructure, residential, water and energy projects being the
growth drivers. The plastic pipes and fittings market growth will also be
driven by the country’s Vision 2030, under which the government aims to
diversify the country’s economy away from oil and support economic growth. The
transition in the preference for plastic type is set to reduce the market of
PVC pipes and fittings and consequently increase the market of PE and PPR pipes
by FY’2022 in terms of revenue. It is estimated that water supply and sewage
sector will still contribute the highest share to the revenue of plastic pipes
and fittings in Saudi Arabia as of FY’2022. As PPR and PE pipes and fittings
manufacturers in the country increase their production and are able to satisfy
the local demand, the proportion of imports are expected to fall in terms of
volume.
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