Carbon steel continues to be the preferred material, says FMI.
Given the extensive utilization by chemical, petroleum, and lubricant industries for storage and shipment purposes, steel drums should continue to witness sustained sales over the following years. As suggested by a new report, the global steel drums market will progress at a steady pace at 3.7% CAGR during 2019 – 2029. Steel drums have been a secure packaging and shipping solution for hazardous as well as non-hazardous liquids. Gains in the global steel drums market would be prominently contributed by their reusability and recyclability.
Key Takeaways – Steel Drums Market Study
- Steel drums with a capacity of 55 gallons are projected to offer lucrative opportunity in the coming decade
- Carbon is estimated to be widely preferred material for manufacturing steel drums, owing to its cost-effectiveness and durability for heavy-duty packages
- The chemical industry, especially commodity chemical, is expected to be a prominent consumer of steel drums
- Tighthead steel drum is estimated to hold high market share in the global steel drums market, while open head steel drum is expected to expand at a maximum CAGR during the forecast period
- Increasing industrialization and export of steel drums from China are expected to provide growth opportunity to steel drums market in Asia Pacific
The consumption of steel drums for transport of various chemicals is projected to increase with rapidly increasing cross border trade from emerging economies. End users’ attraction for reconditioning of drums, the continued growth of IBC containers and the use of plastic drums may slow down the growth of steel drums market in the coming future. Key manufacturers of steel drums are foreseen to enter the reconditioning business.
South & East Asia Emerging as Global Trade Hub
The U.S. Department of Transportation indicated that insurance rate for steel drum shipments is low. The global economy remained stable over the last three quarters in prominent economies. This is clearly reflected in several indicators such as IIP and PMI of manufacturing hub economies. The low cost of manufacturing in China and India led manufacturers across the globe to move their production facilities towards countries in East Asia and South Asia regions. This is expected to facilitate growth in trade volume and enables East Asia & South Asia regions to emerge as global trade hubs.
Developmental Strategies Revolve Around Acquisitions
Key players in the steel drums market are following the strategy of acquisition and expansion of various reconditioning or manufacturing companies, in order to increase their footprints in the market. For instance,
- In May 2014, The Cary Company, a supplier of industrial packaging acquired Three Rivers Packaging, Inc., a Pittsburgh-based industrial container and packaging distributor of steel, plastic, and fibre drums and IBCs.
- In August 2018, a U.S. based steel drum manufacturer, General Steel Drum LLC acquired North Coast Container, Cleveland, a US-based steel drum manufacturer.
Source: FMI