What Will Valve Industry Look Like In 2025?

August 2011, Vol. 238 No. 8

David Dunbar, Tyco Flow Control

Because industrial valves have existed since the dawn of the industrial revolution, the industry can be perceived as mature, traditional and resistant to change. Those of us in the industry know we have played a vital role in global development and evolve dynamically to adapt to industry’s needs. In fact, without innovations from valve suppliers, much of the world’s infrastructure could not exist, and access to essential natural resources would be impossible.

To be sure, innovations in the valve industry do not evolve at the same rate as information technologies or consumer electronics. However, innovations in valves – even the most subtle – have been major contributors to the world’s ability to access and process everything from gold and iron ore to nuclear, gas and coal power and from bulk chemicals to processed food and beverages.

In the next 15 years, we expect the industry to build on the advances of the last 15, further contributing to meet the world’s needs for clean water, power, food and energy.

What’s shaping the valve industry right now? Companies that rely on the valve industry have changed dramatically in the past 15 years. Globalization, industry consolidation and nationalizations have created larger, global companies with different expectations of their suppliers. In response, the valve industry is being shaped to meet these evolving customer needs to deliver consistent technical support, product selection and local services wherever the customer is located.

As resources become scarcer, oil and gas, mining and power companies will continue to expand to the most remote parts of the world to gain access to resources. The globalization of customers in the past decade has been rapid in all of these industries and they are now expecting consistent levels of service and support worldwide. These companies will require established global suppliers able to keep pace and meet their growing and unique demands.

Global customers also require local services. This will push companies to consider locating near customers to provide the critical services they need to grow their businesses. As customers supplement their lack of internal skilled resources with external providers, they will certainly need even more local support and service.

Another trend we are seeing as a result of globalization is increased consolidation among suppliers. The industrial valve market is highly fragmented with thousands of manufacturers. Even the largest manufacturer, Tyco Flow Control, accounts for less than 10% of the industry’s sales. This will change, however, as suppliers expand globally to mirror their customers’ organizations.

As suppliers become more global, it will be imperative that their products and solutions meet the unique needs of local customers. Tyco Flow Control’s recent acquisition of KEF Holdings, a fully integrated valve manufacturer based in the United Arab Emirates, is one example. By expanding its manufacturing in the region and employing local talent, Tyco can help ensure its products and services meet the unique needs of local customers while providing the company with a platform for future growth.

Product Evolution
Products will also progress in keeping with customer needs in the industries that are served. For example, in pursuit of higher efficiency, new power plants are being designed to operate at higher pressures and temperatures that require new product designs and materials of construction; the oil and gas industry is drilling deeper and farther offshore, requiring products that can operate effectively under such conditions; mining industries need products that can withstand corrosive materials for longer periods between service operations and so on.

That being said, product evolution in the industry is steady and gradual, a function of the interplay between design improvements and customers’ willingness to use newer designs vs. traditional products. Pressure relief valves provide a good example.

Eighty-five years ago, these valves were basic, weight-loaded, moment arm design. Today, pressure relief valves (PRVs) are non-flow, modulating pilot-operated valves. Today’s valves offer a host of benefits compared to the original technology; they have the ability to remotely sense relieving pressure, are balanced against back pressure, lighter in weight and larger; more stable during relieving cycles, bear lower repair costs, and are simpler to field test.

It is estimated that as many as 40% of applications in the process industry would benefit from the features and benefits of newer generation PRVs. Despite this, they comprise only 18-20% of the market even 20 years after the introduction of the newer high-performing designs.

Codes And Standards
Codes and standards for valves were first introduced during the industrialization of North America and Western Europe in the early 1900s. These codes and standards were developed locally around local products, manufactures and end users. The United States adhered to ASME/API etc., UK to BS Standards, and Germany to DIN standards. These local standards continued to expand and become more comprehensive, growing to include a broader range of products, materials and applications.

As end-user markets have become globalized, the inherent need for harmonized codes and standards has become clear. As the EU expanded its regulatory reach and ISO standardization development began to take hold, there was a clear sense that harmonization could be achieved. This was further solidified when API committed to harmonize some of its standards with ISO.

But as we look ahead to 2025 toward achieving true harmonization of codes and standards, some significant headwinds are forming. New entrants from emerging markets are developing their own local codes and standards and will likely have new ideas as to how harmonization should occur and what should be included. The development of some processes and related technology is outpacing standards development, limiting the application of harmonized standards. These trends can set back our customers’ efforts to globalize and our efforts to serve them consistently around the world. For industry participants to benefit from harmonization, it is important that the trend to harmonize standards globally continues.

Looking Ahead
The valve industry has a proud history, having helped conquer some of the most challenging engineering problems faced by mankind. New challenges certainly lie ahead, but they will surely be overcome with the same ingenuity and perseverance that are characteristic of the industry.

Valve manufacturers will continue to tackle these challenges, adapting products and services to meet the changing demands and needs of each end-user industry. Whatever the change may be – ever-higher temperatures or pressures, new environments, increased emissions standards, or changing safety, weight or size requirements – the valve industry will continue to develop improved solutions. The industry has survived and thrived under such conditions for more than 4,000 years. We are confident that the industry will continue to prosper in the next 15.

David Dunbar
is the president of Valves & Controls at Tyco Flow Control. He is based in Schaffhausen, Switzerland. Website: www.tycoflowcontrol.com.

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