Material Handling Equipment (MHE) Market Intelligence

Industry Outlook & Drivers

Global Market Outlook on Material Handling Equipment

• APAC will continue to dominate the market in terms of growth prospects, which is expected to grow at 3–6 percent annually until 2020
• Shift of market focus from product to service has been witnessed as an emerging trend in all the major regions to optimize buyer's total cost of ownership

Global Material Handling Equipment (MHE) Market Maturity

• Key trend, which is expected to influence MHE would be the automation of mines. Both mining and construction customers are increasingly looking to optimize their cost due to fluctuating commodity demand

MHE Market Overview

• Global Material handling equipment is expected to grow at a CAGR of 3-4 percent until 2019, driven by increasing demand from emerging countries such as India, Indonesia, China and other South East Asia
• Key end users such as Coal is expected to increase by 1–2 percent by CAGR by output during 2018–2022, while metal production is expected to increase by 2–3 percent during the same period
• Belts and accessories used for conveyors constitutes around 23 percent of the $32.5 Billion global material handling equipment market share. Accessories include belts, rollers, structures, pulleys, scrapers, conveyor drives and skirting
• Increasing mineral output growth rate coupled with expected increase in exploration activity and automation of mines could further drive the demand for mine material handling equipment

Global MHE Drivers and Constraints

Drivers

Commodity Demand/Price 

• Commodity demand is a result of the global economic situation. The average commodity price is expected to grow between 5 percent and 6 percent until 2017, with an increase in demand for MHE from mining industry.

Automation of Mines 

• Decline in the commodity prices and fluctuation s in the demand has forced the mining companies to go for automations of mines in order to improve their profit margin and cost savings which will result in increasing adoption of MHE in mines

Constraints

Mining Industry Slowdown 

• Reduction in mineral output from mines and closure of high cost mining operations due to current mining industry slow down is adversely impacting mine material handling equipment demand

Non-mining Sectors

• Shutdown of thermal power plants around the globe and sluggish demand from other sectors such as infrastructure had driven down the demand for material handling equipment in the recent years

Market Driver-Commodity Price

• Prices of key commodities are the best indicators of mining activities and which in turn evinces the demand for HME
• In Q4 2018, from October 2018 to November 2018, apart from iron ore and copper (which is expected to increase by an average of 5-6 percent) average commodity prices for the rest is expected to decrease by an average of 3-4 percent as compared to last quarters average

• Demand for commodities increased tremendously as the economy recovered from the economic recession in 2009. 2010 and 2011 saw a boom in mining activity due to high demand for raw materials 

• Late 2013 and 2014 witnessed a slowdown in mining, resulting in the reduced demand for HME

• Again, 2014–2015 witnessed reduced demand; however, it is expected to uptrend in the coming years. The average commodity prices for the rest is expected to decrease by 8-9 percent in H1 2019 when compared to same period in the previous year