According to the Market Statsville Group (MSG), the Global Industrial Hydrogen Market size is expected to project a considerable CAGR of 4.9% from 2024 to 2033.
Increasing demand from other industries shifts the rapidly growing market of industrial hydrogen. Hydrogen is of potential interest as a clean energy source for various sectors such as transportation, chemical manufacturing, and petroleum refining. Hydrogen has been accepted by industries as a competitive substitute for conventional fuels, working toward sustainability that encourages innovation in technologies related to its production, storage, and distribution.
Government initiatives towards reducing carbon emissions spur market growth: an appeal of capital invested in fuel cell and hydrogen infrastructure projects. It has been remarkably noticed that partnerships, R&D activities, and strategic collaborations among key players in the industrial hydrogen market have been growing. This dynamic situation creates huge opportunities for market participants to use new trends to satisfy the demand for clean energy solutions and influence the future's global industrial hydrogen utilization landscape.
Hydrogen gas, produced and used in various industrial sectors, is known as "industrial hydrogen." It acts as a reducing agent in metallurgy, a clean fuel for power and transport, and an essential raw material in chemical processes. In addition to its adaptability and eco-friendliness, it is essential for a wide range of industrial applications and fosters sustainability and innovation efforts across multiple global sectors.
Hydrogen is finding application, at an increasing rate, in several industrial segments such as chemicals, electronics, metal treatment, and refining, owing to its fundamental role as a versatile feedstock and process enabler. In the refining industry, hydrogen is required to be used in hydrocracking and hydrotreating processes since it plays a fundamental role in the production of cleaner fuels, removing sulfur impurities from them. Besides the synthesis of ammonia and methanol, other chemical processes occupy an important share of the requirements of the chemical industry. In recent years, the chemical industry has shown impressive growth. For instance, the revenues of the small and medium enterprises in the chemical industry of the country are expected to post an increase of 18-23% in FY22, according to the report from IBEF. Thus, the huge growth in the chemical industry across the globe will result in the growth of the usage of industrial hydrogen.
Hydrogen is applied in metal processing industries as a reducing agent in the production of steel and other metals, hence improving the quality of the final product and the efficiency of the process. Hydrogen finds application in electronics manufacture for the processing of semiconductors and the synthesis of silicon wafers. Hydrogen is, therefore, an element that drives growth in these industrial areas, for it may be used as a versatile feedstock and as a facilitator of efficient critical reactions, for example, hydrogenation and desulfurization.
Integration into large, already existing industrial supply chains of hydrogen is a complex challenge. Frequently, major logistical and technical overhauls have to be made through retrofitting of current machinery and procedures to take hydrogen onboard. This may require changes in the production facilities, storage facilities, and transport infrastructures to handle hydrogen in a manner that is safe and effective. There might also be problems with compatibility—more so for industries dependent on certain sources of energy or even specific processes of production.
Integrating hydrogen into supply chains may require expenses in new machinery, employee education, and legal compliance that will only make the transition more problematic. Furthermore, there could be deep-seated practices in industries that are also likely to resist the new change. This preference for tried and tested technologies over cutting-edge alternatives may have detailed planning, collaboration among various stakeholders, and focused incentives for adoption. Hence, the challenge of the integration of the supply chain may have its toll on market growth.
The study categorizes the Industrial Hydrogen market based on type, production type and end-user area at the regional and global levels.
By Type Outlook (Sales, USD Million, 2019-2033)
By End-Users Outlook (Sales, USD Million, 2019-2033)
Based on the end-users, the market is divided into Chemicals, Petroleum refining, Metal processing, Glass, Electronics, Pharmaceuticals, Food and beverages, and Others. The Petroleum refining segment accounted for the largest market share in the global Industrial Hydrogen market. This dominance places hydrogen in high demand by the petroleum refining industry for the critical procedures of hydrocracking, hydrotreating, and catalytic reforming. Hydrogen becomes an important element in the process of refining crude oil since it gets rid of some impurities and upgrades heavy fractions to lighter, more valuable product types, such as gasoline and diesel. Neutrally More recently, capacity has been increasing, and that itself drives demand for hydrogen in industries; for example, provisional installed refinery capacity as of September 2021 was 246.90 MMT for the oil and gas sector. The Indian Oil Corporation was the largest domestic refiner with a capacity of 69.7 MMT, according to data from the India Brand Equity Foundation.
Increasing stringency of environmental regulations and increasing complexities in crude oil sources force the petroleum refining industry to depend on the need for the production of cleaner and higher-quality fuel. Other process industries include the electronics and food and beverage production industries, the pharmaceuticals industry, and the metal processing industry; most of these industries normally exhibit a level of demand that is incomparable to the demand exhibited by the petroleum refining industry. As a result, the industrial hydrogen market has been led by the petroleum refining industry, which exhibits a huge and stable demand for hydrogen.
Based on the regions, the global market of Industrial Hydrogen has been segmented across North America, Europe, the Middle East & Africa, South America, and Asia-Pacific. Refining petroleum that is developed in the region, especially in the US, creates a high demand for hydrogen in various procedures of refining. For instance, back in 2022, the oil refining capacity in North America was estimated by Statista to be 21.6 million barrels per day. This growing capacity for oil refining is giving new impetus to the growth of the industrial hydrogen market. Also, in North America, hydrogen is used in great proportion in heat treatment and metal refining for the advanced metal processing industry, particularly for the automotive and aerospace industries.
The demand for hydrogen is further augmented by the high presence in the region of the food processing, pharmaceutical, and electronics manufacturing industries. Additionally, technological innovation and adoption in North America encourage the development of applications for hydrogen, such as fuel cells in energy storage and transportation. Government initiatives and support for hydrogen infrastructure development in general, and clean energy, further propel the growth of the market. North America dominates the industrial hydrogen market, driven by an eclectic industrial landscape, technological advantages, and supportive policies. Besides, huge opportunities are seen in expanding this market further.
The competitive landscape of the global industrial hydrogen market is defined by large players like Air Liquide, Linde plc, Air Products and Chemicals, Inc., and Praxair Technology, Inc. In each of these businesses, there are identified shares of competition such as product quality, pricing strategies, and distribution networks, among others. Further, alliances, joint ventures, and mergers and acquisitions stand as two common strategies adopted by most companies for enhancing market position and increasing worldwide presence.
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