Fluid Power Industry Trends in 2017 and Beyond
Global Fluid Power Industry Trends Forecast
The National Fluid Power Association (NFPA) recently published its annual Global Fluid Power Report and Forecast. The report, produced by Oxford Economics, outlines expected demand trends in hydraulic and pneumatic end-use markets across the globe.
In summary, global demand for fluid power products is up, and demand is forecasted to grow for several more years. Via the report:
Fiscal policies proposed by President Trump would benefit American manufacturers and improve already growing markets. In addition, global manufacturing has begun on a strong note thanks new fiscal policies in Europe, currency stabilization in Asia and new developments in the Middle East. However, the report notes rhetoric from President Trump, unsustainable growth in Asian markets and the encroaching reality of Brexit introduce incalculable variables.
| 2016 | 2017F | 2018F | 2019F | 2020F | 2021F | |
|---|---|---|---|---|---|---|
| North America | -1.3 | 2 | 2.7 | 2.2 | 1.9 | 1.7 |
| South America | -14.3 | -8.9 | 2.7 | 3.9 | 3.4 | 3.2 |
| Europe | -0.3 | 1.6 | 2.1 | 2 | 2.1 | 2.4 |
| Asia | 0 | 4.1 | 2.4 | 2.8 | 2.7 | 3 |
| Middle East / Africa | -3.5 | -0.2 | 2.7 | 3.6 | 3.5 | 2.4 |
| World | 0 | 3.3 | 2.5 | 2.5 | 2.3 | 2.4 |
| 2016 | 2017F | 2018F | 2019F | 2020F | 2021F | |
|---|---|---|---|---|---|---|
| North America | -0.8 | 0.2 | 1.9 | 1.8 | 1.8 | 1.7 |
| South America | -3.2 | 1.2 | 4.1 | 5.2 | 4.5 | 4.5 |
| Europe | 1.7 | 2.4 | 1.8 | 1.8 | 2.3 | 1.6 |
| Asia | 5.9 | 5.5 | 3.2 | 3.1 | 2.5 | 3.1 |
| Middle East / Africa | -4.6 | -0.1 | 4.1 | 3.5 | 2.6 | 2.5 |
| World | 3.7 | 4.1 | 2.7 | 2.6 | 2.3 | 2.5 |
All projections based on the NFPA's Global Fluid Power Report and Forecast.
North American Fluid Power Industry Trends
Hydraulic and pneumatic end-use markets are expected to grow in 2017 and even in to 2021. Growth in American construction, motor and generator production has boosted demand for cast iron. However, slow growth in the automotive market and the uncertainty of NAFTA has hurt Canadian markets.
South American Fluid Power Industry Trends
A weak Peso has harmed market growth in Mexico, but will improve in the coming years. Market growth in Brazil will increase, but not before a sharp dive this year. Labor costs in Mexico are low, which will aid future growth.
European Fluid Power Industry Trends
Russia had negative growth recently due to a dangerously weak Ruble. Belgium will experience negative growth this year and next, but is expected to recover next year. Reliable growth in Italy, France and Germany will ensure the European market experiences nominal growth in the coming years. However, Brexit is certain to changed things unexpectedly.
Asian Fluid Power Industry Trends
The Asian pneumatic end-use market grew by nearly 6% last year. Both the hydraulic and pneumatic markets in Asia will continue to grow in the coming years. Rising labor costs in China and a weak Yen in Japan will cause a shift. Taiwan, South Korea and other experienced negative growth in recent years, but are expected to recover.
Middle Eastern and African Fluid Power Industry Trends
Low oil prices contributed to negative growth in both the hydraulic and pneumatic markets. Weak growth in South Africa’s automotive sector is largely to blame. Developments related to World Expo 2020 and robust tourism growth in the UAE will ensure overall market growth by the end of 2018.