U.S., EUROPE AND ASIA INDUSTRIAL HYDROGEN MARKET ANALYSIS

U.S., Europe and Asia Industrial Hydrogen Market- 2017-2027

Hydrogen is a chemical compound with atomic number 1 and is widely used in the production of carbon steels, semiconductors, and special metals. It is used as a reducing agent and carrier gas in the electronic industry. Nowadays it is also used across various industrial applications such as it are used as reducing agent in the metallurgical industry and as a basic building block in the production of ammonia for fertilizers and methanol for the production of polymers. Moreover, in refineries hydrogen is used in the processing of intermediate oil products.

The U.S., Europe and Asia industrial hydrogen market is projected to reach US$ 22.8 billion by the end of 2027, in terms of revenue, growing at CAGR of 5.0% during the forecast period (2019 to 2027).

Drivers

Growing demand for fertilizers owing to the rising need for quality yield due to rising population is expected to augment the market growth of industrial hydrogen. Industrial hydrogen is used in the production of ammonia and ammonia is widely used in the production of fertilizers. Moreover, hydrogen is also used in the electronic, metal fabrication, and pharmaceutical industry and microeconomic growth of these industries is expected to foster the market growth industrial hydrogen in U.S., Europe and Asia.

Increasing application hydrogen across the LED and semiconductor industry where it is used to control the atmosphere in the production of LED and semiconductor is expected to augment the market growth. Growing demand for LED as it is highly efficient and have long operational life compared to incandescent is projected to fuel the demand for hydrogen, which in turn propelling the market growth of hydrogen over the forecast period. Furthermore, the booming electronic industry is also projected to propel the market growth of hydrogen. 

Geographically, U.S. dominated the U.S., Europe and Asia industrial hydrogen market in 2018, reporting 56.4% market share in terms of revenue, followed by Asia-pacific and Europe, respectively.

Figure 1. U.S., Europe and Asia Industrial Hydrogen Market, Revenue Share (%), By Region, 2018

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Market Restraints

The production cost of hydrogen is high, as it is mainly produced from natural gas, coal and various hydrocarbons and only a small fraction of hydrogen, in the range of 3-4%, is produced during electrolysis of water because it is relatively more energy-intensive. Moreover, overall production of hydrogen is expensive than conventional production. Therefore, the high cost of the hydrogen is estimated to restrict the market growth of hydrogen over the forecast period.

Use of hydrogen that is produced by electrolysis is limited to energy sectors where renewable energy such as solar or wind is used for producing electricity for electrolyzers. Therefore, the limited application of hydrogen that is produced by the electrolysis process is projected to hinder the market growth of hydrogen.

Market Opportunities

Higher emphasis on enhancing overall process economics owing to the high production costs of electrolytic hydrogen. Many manufacturers are focusing on increasing overall efficiency of the process such as advancements in membrane and catalyst are projected to cut down the overall production cost significantly in the near future. Moreover, rising focus on a technical scale of production i.e. development of high-pressure electrolyzers and overvoltage reduction of the oxygen evolution reaction (OER) in electrolyzers is further projected to offer significant growth opportunities to the market of hydrogen.

Increasing usage of hydrogen as a fuel in rockets since it is highly flammable and efficient is projected to propel the market growth. Hydrogen is enough to offer power to powerful machines such as spaceships and also it is environmentally friendly and much safer choice as compared to other fuel sources which are further propelling the market growth of hydrogen. Moreover, rising demand for hydrogen as a fuel is also attributed to the fact that it is three times as powerful as gasoline and other fossil fuels which is also predicted to foster market growth. 

Figure 2. U.S., Europe and Asia Industrial Hydrogen Market – Opportunity Analysis

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Market Trends

An increasing partnership among major players to build a new hydrogen plant in order to meet the rising demand is expected to propel the market growth over the forecast period. For instance, in September 2019, Hyundai and Hydrospider enter into a partnership to build an industrial hydrogen ecosystem. This partnership focused on the promotion of clean transportation in Switzerland and European countries in the near future. Therefore, increasing the expansion of the hydrogen production plant is expected to augment the market growth of hydrogen over the forecast period.

Increasing investment in the production of green hydrogen is expected to augment the market growth of hydrogen over the forecast timeframe. For instance, in October 2019, the Ministry of Education and Research announced the investment of US$ 333 million more into research on green hydrogen and has promised that Germany will become the world’s largest market in hydrogen technologies by 2023. Hence, rising such investment on the promotion of green hydrogen will favor market growth.

Figure 3. U.S., Europe and Asia Industrial Hydrogen Market, Revenue Share (%), By End Use, in 2018

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On the basis of end use, in 2018, electronics accounted the largest market share of 22.2% in terms of revenue, followed by glass and metal production, respectively.

Competitive Section:

Key players active in the U.S., Europe, and Asia Industrial Hydrogen market are Air Liquide, Air Products & Chemicals Inc., Praxair Inc., Linde Plc., and Messer Group GmbH

Few Recent Developments

Air Liquide

• In November 2015, Air Liquide signed an agreement to acquire Airgas, one of the leading suppliers of medical, industrial and specialty gases in the U.S. 
• In 2015, the company deployed its newly developed Cryocap technology for capturing CO2 released during the production of hydrogen through a natural gas reforming process.

Air Products and Chemicals Inc.

• In July 2016, the company set up a new world-scale hydrogen production facility in Ft. Saskatchewan, Canada