Increased water recycling

21st February 2013

The aggressive pursuit, by most European industries, of environmental safety and natural resource preservation through increased recycling is leading to augmented chemicals use.

However, these end users are exploring ways to minimise the use of chemicals by opting for advanced technologies.

At the same time, chemicals manufacturers are attempting to develop environmentally safe products for various key applications and total solutions for water treatment to sustain their business.

Frost & Sullivan finds that the European Industrial Water Treatment Chemicals Market earned revenues of EUR1.1 billion in 2006 and is estimated to reach EUR1.5 billion in 2012.

Expanding member statesenvironment safety and legislation play an important role in ensuring stable demand for water treatment chemicals used in industries says Frost & Sullivan Research Analyst Mahesh Kumar S. European industries will face greater responsibilities in ensuring that they comply with prescribed legislative standardsthus boosting the market's growth potential."

Heightened awareness about environmental safetythe preservation of fresh water sources and increasing reuse and recycling of water within industrial processes is resulting in additional treatment by industries. Alsothe cost effectiveness of water treatment chemicals is negating the minimal threat posed by alternativesthus proving to be a boon for chemical manufacturers.

Howevergrowing competition and the commoditisation of water treatment chemicals are reducing profit margins. Slow industrial growth within Europe is encouraging the entry of low-cost and medium-quality producers from other regionsfurther intensifying competition. In additionindustries are investigating ways to minimise the use of chemicals in most processes by opting for alternate technologies.

"Consolidated end user industries and greater competition among chemicals manufacturers has resulted in commoditisationpushing profit margins to unsustainable levels explains Mr. Kumar. The market tendency is shifting towards providing enhanced customer services to ensure differentiation and maintain profit margins."

Chemical manufacturers will need to build expertise in service provision to end usersproduce environment-friendly products and widen their product portfolio to ensure long-term sustainability. A thorough understanding of legislation and the provision of suitable products to end users will enable market participants to enhance their market position.

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