More Than 50 Percent Of The World s Ultrapure Water Products Will Be Purchased By Just 50 Companies
Power plants, electronics manufacturers and pharmaceutical producers will spend $4.6 billion in 2015 on products and services to purify water to such an exceptional degree that there is a whole classification called "ultrapure" water. This purity is obtained with a combination of chemicals and physical process steps such as reverse osmosis (RO) and ion exchange.
UPQ Expenditures by Industry (Image: McIlvaine Company)
The purchases will be concentrated among relatively few companies. The top 20 companies will purchase 37 percent of the total products and the top 50 companies will average more than 1 percent each ($23 million).
The top 8 semiconductor companies will account for purchases of $795 million. The top 10 power generator purchases will total $625 million. The top 4 flat panel and other electronics manufacturers will spend $284 million.
Pfizer is the top pharmaceutical purchaser but is only ranked #23 on the list of the 40 largest purchasers.
The large ultrapure water product purchasers are moving toward global sourcing for several reasons. One is the importance of the products to the plant operations. A single small particle can cause rejection of a $300 chip. Contaminated drugs are one of the biggest concerns of pharmaceutical companies. The ultra supercritical power plants which are now under construction require water purity levels far greater than the sub critical power plants which they are replacing.
The second reason for global sourcing is to facilitate evaluations on total cost of ownership. The high cost of these evaluations is spread out among a number of purchases. The benefits of buying the best rather than lowest price products far outweigh the costs.
Source: The McIlvaine Company
