Market Trends of LA Explosion-Proof Equipment Industry
This section covers the major market trends shaping the Latin America Explosion Proof Equipment Market according to our research experts:
Explosion prevention to hold significant share
- In the wake of increasing industrial accidents and explosions in mines, regulatory bodies are initiating the implementation of stricter regulations to ensure worker safety and also prevent damage to the atmosphere. Oil and shale reserves are generally found in ecologically sensitive areas like the Arctic circle. The Discovery of new oil reserves in countries like Brazil is expected to drive the market for explosion-proof equipment.
- Preservation of the environment is a high priority concern, and the governments are cognizant of the issue. This has resulted in the implementation of government regulations, particularly in the oil and gas exploration industry.
- Explosion prevention equipment is preferred in cases where the isolation or addition of specific parts to the equipment will not affect the total functionality of the equipment and is feasible practically. Intrinsically safe and increased safety equipment collectively account for a majority share of the explosion prevention market. Other major equipments in prevention include pneumatics and fiber optics.
- High reliability, ease of installation and maintenance, lower downtime, and cost are the advantages of the prevention equipment favoring their adoption, in addition to the worldwide recognition of intrinsic safety standards.
- However, the inability to operate at high power levels, planning and design complications and the relatively expensive nature of certain prevention equipment are hindering the growth of the market.
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Brazil to hold major share
- The major regulatory standard for explosion-proof equipment in the country is NR12. Further, Portaria INMETRO Nº 179 is the Brazil certification program for all Electrical Equipment for Explosive Atmospheres under Combustible Dust and Flammable Gases and Vapors. This regulation dictates the compliance assessment program's criteria and requirements on electronic and electrical equipment for explosive atmospheres.
- Brazil has enormous economic growth potential and is particularly attractive to investors due to its advanced industrialization, political stability, and huge reserves for raw materials. Furthermore, the South American Mercosur trade agreement, which includes Argentina, Brazil, Paraguay, Uruguay, and Venezuela, strengthens the South American market and opens up the additional wide-ranging potential for the Brazilian business.
- According to the National Agency for Petroleum, Gas, and Biofuels, national oil production in Brazil in 2020 crossed the mark of 1 billion barrels, an average of 2.79 million barrel per day in the year. These numbers indicate a 7.78% increase in production. Besides, the production of natural gas crossed by 9.46%, from 40.8 to 44.7 billion cubic meters in 2020.
- Moreover, Petrobras's business plan for the next decade may lead to significant investments amounting to USD 74.1 billion in areas, like exploration, maintenance, and logistics, driving the demand for safety for electrical equipment and hazardous wiring locations.
- The market studied in the country is witnessing expansions in renewable energy, biofuels, and biopower. Such developments are anticipated to boost the adoption of explosion-proof equipment over the forecast period.
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