Industrial Explosives Market Size Forecast to Reach US$10.5 Billion by 2026

Industrial Explosives Market
Growing Investments in Mining Sector Globally Contribute to Increased Business Growth in Industrial Explosives Market

Industrial Explosives market size is forecast to reach US$10.5 billion by 2026, after growing at a CAGR of 5.8% during 2021-2026. Industrial Explosives are high hazard blasting explosives primarily used in the mining, quarrying and construction industry. Basic components of Industrial Explosives include oxidizing agents. Ammonium nitrate fuel oil (ANFO) is one of the most widely used Nitrogen explosives. This explosive is a complex mixture of 95-96% ammonium nitrate (AN) and 4-5% liquid hydrocarbons. slurry explosive is essentially an aqueous solution of an inorganic oxidizer gelled with a carbonaceous gelling agent. The market is witnessing growth, due to the rising demand for blasting materials from the mining and construction industry. Increasing population and rapid urbanization is ensuring significant opportunities for ongoing and upcoming Industrial and commercial projects, which need explosives for various purposes. It is expected to drive the Industrial Explosives market substantially during the forecast period.

COVID-19 Impact

Due to the COVID-19 pandemic, an immediate supply chain disruption was driven by lockdown and physical-distancing measures. This has resulted in interrupted production operations in major mining and construction manufacturers. Mandated shutdowns and lower demand for commodities have resulted in under supply of raw materials of chemical explosives such as nitroglycerin, and oxidizer, such as black powder or grain dust. Human resource crises or personnel layoffs, significant missed business goals. The impact of the pandemic on commodity prices due to demand variability will require manufacturers to continue focusing on safety, optimize operations, and remain financially sound. Thus the Industrial Explosives Market is expected to recover steadily with growing mining and construction activities globally.

Industrial Explosives Market Segment Analysis – By Type

Ammonium Nitrate segment held the largest share of 35% in the Industrial Explosives Market in 2020. Ammonium Nitrate prills provide a concentrated supply of oxygen than the air around. This is why it is effective in mining explosives, where it’s mixed with oil and other fuels. Slurry Explosives is an aqueous solution which is pumpable explosives containing Ammonium Nitrate, sensitized with fuel, which is pumped into holes in both U/G and surface mines. Ammonium Nitrate Fuel oil is widely used as an explosive because of its low explosion temperature, and cooling agent such as sodium chloride or ammonium chloride to prevent the heat of their explosion in a mine from igniting underground gases such as methane, or a combination of them and coal dust, and causing a fire or disastrous secondary explosion. Russian Federation is the top country in Ammonium Nitrate(Ammonium Nitrate Fuel oil) production in the world. In 2020 the URALCHEM produced 24.2% of Russian ammonium nitrate. The company has facilities available for the production of over 3 million tons of ammonia, 3 million tons of Ammonium Nitrate per year. Hence the growing production and uses of explosives aid to the growth of the Industrial Explosives Market.

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Industrial Explosives Market Segment Analysis – By Application

Mining segment held the largest share in the Industrial Explosives Market in 2020 and is growing at a CAGR of 7.8% during 2021-2026. India has a high demand for industrial explosives from the metal mining sector due to the presence of numerous metal producing mines. According to Make in India, India has rich deposits of coal in the world. The total estimated reserves of coal in 2020 were 344.02 billion tons, an addition of 17.53 billion tons over 2019. The Mining industry in India is one of the core industries of the economy. It provides basic raw materials to many important industries. India is the world’s second-largest coal producer and being the 5th largest country in terms of coal deposits. It is a net exporter of finished steel and has the potential to become a champion in certain grades of steel. Russia’s coal mine production is projected to grow at a CAGR of 2.3% in the 2019–2025 period according to Fitch Solutions. As of 2019 coal exports amounted to 205.4 million tons of coal which provided the Russian economy with about $16 billion in foreign exchange earnings. Russian coal companies transferred 100 billion rubles in tax payments to the state budget  approximately $1.5 billion. Thus growing investments in mining sector globally contribute to increased business growth in Industrial Explosives Market in the forecast period. 

Industrial Explosives Market Segment Analysis – By Geography

Asia-Pacific region held the largest share in the Industrial Explosives Market in 2020 up to 44%. The growth is owing to the rise in demand for minerals, coal, and rare earth metals, such as gold and silver, which are present inside the earth crust. The largest consumers of explosives in industrial applications are China, the United States, the Commonwealth of Independent States, and Central and South America. It is estimated that the Coal mining is by far the largest consuming sector for industrial explosives, accounting for just under 40% of total consumption globally. Production of stone for construction and production of cement from quarrying operations accounts for an additional 16% of the world mining market for explosives. Russia hosts one of the world’s largest mineral resources, its mining sector is an important supplier for the global economy. In 2018, Russia ranked as the largest miner of rough diamonds, the third largest gold producer and the third largest coal exporter. According to International Energy Agency, Worldwide coal production in 2019 increased by 1.5% to 7953 Million tons. China the world’s largest coal producer accounted for about 46% of global coal production in 2019. The increase in coal production was driven mostly by countries in the Asia Pacific region,73% of global production.

Industrial Explosives Market Drivers

Increasing Demand for Earth Minerals:

Rare-earth elements (REEs) such as neodymium, europium, terbium, dysprosium and yttrium are essential components in high technology devices, including smart phones, digital cameras, computer hard disks, light-emitting-diode (LED) and others. Large quantities of some REEs are used in clean energy and defense technologies. These minerals are critical components of electronic devices, and vital for many green technologies. They are in magnets for wind power turbines and in batteries for hybrid-electric vehicles. The application of REEs in various sector aids to the growth of mining sector and hence projecting growth of Industrial Explosives Market.

Huge Investments in Mining sector globally

According to the United States Geological Survey (USGS), Russia ranked among the world leading producers of commodities including bauxite, coal, copper, diamond, gold, iron ore, lead, nickel, PGM, potash, silver, uranium and others. With 157 billion tons of coal deposits, Russia holds the second-largest recoverable coal reserves in the world. The Russian state will spend an estimated US$123 billion. India holds a fair advantage in production and conversion costs in steel and alumina. Its strategic location enables export opportunities to develop as well as fast-developing Asian markets. According to Indian Brand Equity Foundation, as of FY21, the number of reporting mines in India were estimated at 1,229, of which reporting mines for metallic minerals were estimated at 545 and non-metallic minerals at 684. In March 2021, Coal India Ltd. (CIL) approved 32 new coal mining projects, of which 24 are expansions of the existing projects and the remaining are Greenfield. The estimated cost of the project is INR 47,000 crore (US$ 6.47 billion). Among them, the fixed assets investment in the coal mining and washing, oil and gas extraction, non-metals mining and processing, ferrous metals mining and processing, non-ferrous metals mining and processing increased by 29.6%, 25.7%, 30.9%, 2.5% and 6.8%, respectively. Thus the huge investments in mining sector globally will significantly drive the Industrial Explosives Market growth.

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Industrial Explosives Market Challenges

Hazards associated to Explosives

In mining, Nitrogen explosives are the most obvious form of explosion hazard. Blasts and shots are controlled releases of chemical energy. However, the potential for the uncontrolled release of stored energy is also present and can be unrecognized. Unwanted events can damage equipment and infrastructure, release shrapnel and cause injury or, in the worst case scenario, be fatal. The different ways a person can come into contact with hazardous chemicals are called exposure pathways. There are three basic exposure pathways: inhalation, ingestion, and skin contact. Employers are required to compile written process safety information (PSI) about highly hazardous chemicals and process equipment for all PSM covered processes. The compilation of written process safety information will help the employer and the workers involved in operating the process to identify and understand the hazards involved in their processes.

Industrial Explosives Market Landscape

Technology launches, acquisitions, and R&D activities are key strategies adopted by players in the Industrial Explosives Market. Industrial Explosives Market top companies are:

1. AECI Ltd.

2. Austin Powder Company

3. EPC Groupe Inc.

4. Tec Pivot Limited

5. Irish Industrial

6. Explosives Ltd.

7. Keltech Energies Ltd.

8. Maxam Corp.

9. NOF Corporation

10. Orica Ltd.

11. Sigdo Koppers S.A.

12. Solar Industries India Ltd. and others.

Acquisitions/Technology Launches

In February 2020, Orica announced that to acquire Exsa, Peru’s leading manufacturer and distributor of industrial explosives.  As part of the deal Orica will integrate into its global manufacturing footprint Exsa’s new, state of the art Initiating Systems (IS) manufacturing facility. By utilizing latent capacity, Orica will be able to significantly increase production, transforming IS manufacturing capability with the potential to serve demand right across the Americas. 

Key Takeaways

Asia-Pacific dominates the Industrial Explosives Market, owing to the increasing Mining industry growth and huge construction activities in the region.

Increased domestic demand for metals and coal, for the rapid construction activities in Asian countries such as China, India aiding to the demand of Industrial explosives.

Increasing housing and infrastructure projects and enhancement of public transportation facilities including railways and roadways, is expected to result in growth in the number of intensive tunneling and road development projects where the industrial explosives are heavily used.

China is the world’s largest construction market with the industry forecasted to grow at an annual average of 5.2% in real terms between 2021 and 2029, according to the International Trade Administration

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