MIDDLE EAST CONVEYOR BELTS MARKET ANALYSIS

Market Challenges And Opportunities

Market Dynamics- Restraints

1. Low-profit margins for manufacturers of premium products is expected to restrain growth of the Middle East conveyor belts market during the forecast period

Major OEMs in the market face challenges associated with price and low-quality belt. This in turn is challenging premium quality manufacturers to market their products in standard price offerings. Investments made into upgrading technology by key players often fail to fetch commensurate returns from the market, causing the players to exit the market in a very short period of time. Hence, these factors are expected to restrain growth of the market during the forecast period.

2. Heavy reliance on raw materials is expected to hinder the Middle East conveyor belts market growth over the forecast period

Majority of conveyor belt manufacturers in Middle East and Africa rely on imports of procuring raw materials such as natural and vulcanized rubber and galvanized steel wires. There are a handful of conveyor belt manufacturers in the region, with most of them concentrated in a few clusters of GCC countries and Turkey. Raw materials such as natural rubber, galvanized steel wires, and fabric in the region are primarily imported from South Korea, China, and Russia, while carbon black is imported from the Philippines. Therefore, these factors are expected to hinder the market growth in the near future.

Market Opportunities

1. Demand for halal-certified conveyor belts can present lucrative growth opportunities

Increasing demand for halal-certified food products in the Middle East in turn offers lucrative growth opportunities for OEMs of conveyor belts. Conveyor belts are an integral part of the food and processing industry. Halal-certified conveyor belts are further expected to adhere to dietary guidelines for production of halal-certified goods. For instance, in July 2014, Cambridge Engineered Solutions., a leading global conveyor belt manufacturer, announced halal certification of its conveyor belts by U.S.-based Islamic Services of America (ISA). As of 2014, the company is the only metal belt manufacturer with halal certification by the ISA.

2. Growing expenditure construction industry can pose major business opportunities

Increase in expenditure in the construction industry is expected to create new opportunities for OEMs of material handling equipment in the Middle East region, which in turn is expected to augment market for conveyor belts. According to Coherent Market Insights’ analysis, construction spending in the Middle East is expected to increase by 3.4% in 2016 as compared to 2015, which in turn is expected to create significant growth opportunities for OEMs of conveyor belts in the Middle East.