Wire & Cable Technology International - January/February 2008 - (Page 18)

Wire & Cable Economics by: Philip Radbourne, Analyst Integer Research Ltd. 55 Farringdon Road London, EC1M 3JB, United Kingdom Philip.Radbourne@integer-research.com www.integer-research.com Global Economy Drives Specialty Cable Demand way in Europe, and now India and China are also kicking in. This market in the USA has been delayed by the energy bill, and in the UK delays in policy decisions and changing targets have delayed a real take-off here as well. The leading producers globally in the specialty cable market are Prysmian, Nexans, Draka and General Cable, all which produce specialty cables across a range of sectors at manufacturing operations worldwide. The main absence from this market are the Japanese cable producers, which have only really concentrated on their home markets. Latest data in Q4 2007 from Prysmian suggests that the company is the largest producer of specialty “energy” wire and cable, globally. It has been doing well at its Brazilian operations as well as in China in oil and gas. It has a strong market share in the USA and Europe. However, it has a weak position in merchant shipboard cable in China, Korea and Japan. The crane business in Italy and Germany has been doing exceptionally well—feeding from strong demand from German manufacturing. Prysmian, like Nexans, has sought to keep this business by following customers to new locations such as China. Nexans has entrenched itself in the global market for specialty cables with a higher exposure to the merchant shipboard cable market, given its Kukdong acquisition back in 2000/2001. It has now expanded further by taking control of Olex, which was one of leading makers of specialty cable in infrastructure in Asia. The recent take-over of Madeco will also increase Nexans’ market share in the mining sector in Latin America. In this extent, it will compete with General Cable, which has taken-over the Phelps Dodge cable operation that also produces mining cable. Finally, we can look at Draka, which appears to have been less active, but has actually been investing in its existing oil and gas, shipboard and rubber cables operations. Draka has increased its share in the transport and rubber cable markets after the company’s acquisition of IWG and Cornelia Thies. Draka has also signaled its intent on capturing an increasing share in the market for renewable energy sources, such as off-shore wind-farms. It has expanded its factory in Suzhou (China), and it has installed new extrusion lines in China, USA and Germany, as well as a new compounding facility in the Netherlands. Its latest move was to acquire DeBiase Lift Components Srl in Milan, Italy, boosting its market share in the global elevator (lift) cables market. WCTI In this article, we look at the world market for specialty cables—basically a range of cables that are used in a range of industrial sectors worldwide. This is quite a complex and fragmented market, but recent work by Integer Research suggests that the global market for specialty cable reached US$9 billion in 2006, from a total market of around US$119 billion. Although only around 8% of the global total, this market takes up a greater share in the developed world, where there is less demand proportionally for infrastructure and utility power cables. When we measure the total value of the cant changes in copper and polymer prices, which have boosted the “metal adjusted” pricing of the market by almost 70% since 2005. However, terms, as there has been a worldwide boom in demand from the mining and mineral resources industries globally. This “commodity boom” has fed through to shipbuilding, oil and gas—offshore demand as well as a range of specialty cables used in mining and handling industries. Australia, Brazil and resource industries, which is again boosting demand. We have also seen China continue to steam ahead in terms of its development, and this has meant further investment equipment—again underpinning demand for specialty cables. We are now also seeing an increase in India, and so we see a large increase in the number of wire and cable producers manufacturing rubber cables in India. These are the mega-trends in the industry, but we also see the impact of Katrina on the oil and gas industry in the USA. There has been a great deal of catch-up in this industry as repair and maintenance boosts the industry. In addition, we have also seen a concerted increase in the demand for renewables. Certainly a switch away from fossil fuels in the OECD—outside the USA. This has meant that demand for wind turbine equipment globally has also been strong. This is a small but growing market. Germany, Spain and Denmark have led the 18 Wire & Cable Technology International/January 2008 http://www.integer-research.com http://www.roteqmachinery.com http://www.roteqmachinery.com

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Wire & Cable Technology International - January/February 2008 Editorial Wire & Cable Events Industry News Global Economy Drives Specialty Cable Demand Corporate News Change is Tough! Top Products of 2007 New Magnesium Hydroxides Enabling Low-Smoke Cable Compounds Straight From the Show - IWCS Conference™ A History of Long-Term Thinking Ensures a Pioneering Spirit Expediency of Roller Dies Application in Wire Drawing - Part 1 WireDrawing 101 Strain Rate Transforming Our Ideas Into Your Success Straight From The Show - Wire Southeast ASIA 2007 Capstans, Dancers, Accumulators Roundup Spotlight On Quality Control Pioneering Virtual Technology for Extrusion Electrically Heated Furnace Cuts Energy Costs/Reduces Carbon Footprint Machinery Accessories Materials Polymer Developments in the Cables Industry Wire & Connector Top Products of 2007 Just Load, Click and Print Superior Flame Resistance for Minimal Smoke, CO & Acid Gas High-Flex Round Cable Added to On-Line Design Tools Failed Bridge Cables Replaced With Smaller, Stronger Ones Advertisers Index Classified Advertising Internet Spotlight Editorial Index

Wire & Cable Technology International - January/February 2008

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