Industrial Furnaces Market

Market Overview

The global industrial furnaces market size was valued at USD 12.5 billion in 2022. It is estimated to reach USD 21.16 billion by 2031, growing at a CAGR of 5.3% during the forecast period (2023–2031).

An industrial furnace is a thermal inclusion employed to process and treat raw materials in a solid and liquid state at high temperatures. It comprises a refractory chamber, a hearth, a solid, liquid, or gaseous fuel, electricity, a chimney, a burner, charging and discharging doors, and loading and unloading tools. It is an industrial heat-treating system that heats above 1,000 degrees Fahrenheit.

Manufacturers, steel production industries, mining companies, and foundries employ industrial furnaces to produce metals (iron, silver, copper, and others) from their ore by merging extreme temperatures with a chemical reducing agent and decomposing the ore to separate the pure metal from the contaminated slag. The major objectives of using an industrial furnace are to use heat proficiently (so that losses are minimum) and to manage and control the diverse phases (gas, liquid, or solid) moving at various speeds for different temperatures and times such that corrosion and erosion of the refractory are least.

Highlights

• Gas/fuel-operated industrial furnace dominates the furnace type segment
• Box-type arrangement dominates the arrangement segment
• Metals and mining dominate the end-user segment
• Europe is the highest shareholder in the global market

Market Dynamics

Market Drivers

Growing Demand for Fabricated and Processed Metals in Various End-User Industries

A quick surge in the automotive and construction sector has fueled the demand for a large volume of sheet metals in China and India, where in the sheet metal processing market in Asia-Pacific is projected to boost at a substantial CAGR throughout the forecast period. Global employment in the construction sector is predicted to increase by nearly a quarter between 2015 and 2030. In addition, metal and metal-manufactured products are demanded by various end-user industries such as automobile, healthcare, aviation, construction and building, and others, owing to their superior strength and durability offered by them.

According to the World Steel Association, the total body weight of a passenger car comprises over 50% steel, and an average body weight of an SUV or any other light truck encompasses 3,000 pounds of metal. Therefore, growth in the use of magnesium alloys for the interiors of a vehicle is anticipated to boost the adoption of fabricated metals, thereby driving the growth of the market.

Rising Investments and Growth of the Industrial Sector

The chemical, electronic, and construction industries have all seen increased demand for industrial furnaces. Therefore, the rise in adopting these furnaces is anticipated to boost market growth. In addition, India and China are some of the major industrial destinations of the world, owing to the adoption of several initiatives such as Make in India by the Indian Government and MIC 2025 by the Chinese Government.

In addition, the manufacturing industry in the U.S. contributed around 12% of GDP in 2018. This is attributed to higher investments in the manufacturing and industrial sector. Moreover, Advanced Manufacturing Technology Consortia (AMTech), Investing in Manufacturing Communities Partnership (IMCP), and other initiatives the U.S. Government offers fuel the market's growth.

Market Restraint

High Initial Cost and High Energy Consumption

Industrial furnaces consume a substantial amount of energy and have a considerable impact on product quality; therefore, manufacturers should focus on improving the quality of the furnaces. Heating applications consume almost 1/5 of all industrial energy (OEERE 2001), and this study has calculated that greenhouse gas emission from a direct gas-fired industrial furnace is 0.2–0.4 tCO2e per ton of product throughput for a 1-MW furnace. Reducing the energy consumption of furnace units offers a focused and feasible energy-saving approach. High initial investment associated with industrial furnaces, particularly gas-fired or continuous industrial furnaces, is expected to impede market growth.

Market Opportunities

Increasing Technological Advancements

Continuous technological advancements in the global industrial furnaces Industry are expected to provide ample growth opportunities for furnace manufacturers and suppliers in the upcoming years. Major players in the market are already shifting their focus toward innovation and technological advancements to maintain competitiveness and garner major market share. Furthermore, introducing new heating technologies, interactive furnace interfaces, and high-speed convection furnaces is expected to provide potential opportunities for market expansion. Such advancements are expected to offer lucrative opportunities for market growth.

Furthermore, industrialists aim to design machines and technologies that ease production, lessen maintenance costs, offer production suppleness, and reduce wastage and lead times. Moreover, they strive to decrease the operating and production costs of industrial furnaces to improve their quality. In addition, countries like the U.S., Germany, and Japan have highly advanced technological businesses, developed processing facilities, highly competent workforces, and increased R&D initiatives. Therefore, the rise in applications and elevated competition inspire companies to focus on technological advancements to meet the increase in consumer demands. This is anticipated to offer remunerative opportunities for market expansion.

Regional Analysis

Based on region, the global industrial furnaces market is bifurcated into North America, Europe, Asia Pacific, and LAMEA.

Europe Dominates the Global Market

Europe held the most significant global industrial furnaces market shareholder and is anticipated to exhibit a CAGR of 4.3% during the forecast period. Europe is a potential industrial furnaces industry due to its advanced infrastructure, easy availability of high-end products and technology, and high disposable income. An increase in investment in high-end technological industrial furnaces by countries like Germany, France, and the UK is a significant factor that fuels the growth of the European market. In addition, domestic players such as ANDRITZ AG and LÖCHER Industrieofen offer advanced industrial furnaces to the market. For instance, German-based SCHLAGER Industrieofenbau GmbH provides chamber furnaces for the heat treatment of high-quality products and forging shops. The European industrial furnaces market value is projected to continue to witness innovations in designs, functionalities, and modes of heat transfer and heat recovery techniques. All these factors together significantly contribute to the market growth in Europe.

Asia-Pacific is estimated to exhibit a CAGR of 6.4% over the forecast period. The Asia-Pacific industrial furnaces market size is anticipated to witness a high growth rate, owing to the presence of emerging economies. The growth in the electronics and aviation industries is expected to lead to the development of the market. With the increase in industrialization, Asia-Pacific is projected to gain considerable monetary value in the industrial furnace market during the study period. In addition, several notable steel-making plants are anticipated to begin projects in India and other regional countries, estimated to gain value share in the industrial furnaces market. For instance, in February 2018, China-based Tsingshan Holding Group initiated work on building a cold-rolling line, which on completion, is expected to be one of the major stainless-steel projects in India. Likewise, the new stainless-steel plant in Gujarat is expected to market products throughout the country and the rest of Asia to meet the ever-growing demand for stainless steel and stainless steel products. All these factors are predicted to contribute to the regional market growth.

In North America, industrial furnaces are experiencing a boom due to an uptick in demand from final consumers for products that feature cutting-edge technology. Key players such as Ipsen and Baker Furnace, Inc. focus on developing advanced industrial furnaces to boost the market's growth. For instance, the ATLAS atmosphere batch furnace system line by Ipsen USA offers versatility and precision through advanced controls, intelligent interfaces, and ease of integration. Further, the market in the region is witnessing demand for premium range industrial furnaces, owing to the increase in purchasing power of end users. Moreover, the metal processing and aviation industry has witnessed huge demand for industrial furnaces. This is attributed to electric furnaces' advantages, such as safety and reliability, cost-effectiveness, and time savings.

LAMEA comprises Latin America and the Middle East and Africa. Strong manufacturing activity, steady economic development, increase in automotive production, rise in production of various production line machinery, and robust construction activity is the major drivers of the LAMEA industrial furnaces market. In addition, companies focus on introducing innovative and advanced industrial furnaces to meet the rising demands of the automotive, metals and mining, and electronics sectors. For instance, Brazil-based Combustol & Metalpó Group offers industrial furnaces to various steel mills in Brazil. The company's client base includes CSN, Usiminas-Cosipa, CST-ACELLOR-MITTAL, PETROBRAS, and Gerdau.

Segmental Analysis

The global industrial furnaces market is segmented by furnace type, arrangement, and end-user.

Based on furnace type, the global industrial furnaces market is segmented into gas/fuel-operated industrial furnaces and electrically operated industrial furnaces. 

The gas/fuel-operated industrial furnace segment owns the highest market and is estimated to exhibit a CAGR of 4.9% during the forecast period. Gas/fuel-operated industrial furnaces transform a heat source such as natural gas and others into thermal energy to attain a higher temperature than what can be attained by other machines and equipment. A varied range of functions can be performed using a gas-fired industrial furnace, such as materials sintering, tempering, and testing; however, the general components of the furnace remain the same. Gas/fuel-operated industrial furnaces are widely used across varied end-user industries, such as aerospace, oil and gas, automotive, and steel, as they have high-temperature requirements in a short time. Hence, the development of the automotive and plastic molding industries boosts the adoption of gas/fuel-operated industrial furnaces.

The electrically operated industrial furnace comprises a heating chamber with electrical energy as the heat source for reaching very high temperatures to alloy and melts refractories and metals. The electrical energy has no electrochemical impact on the metal but merely heats it. In addition, electrically heated furnaces are the most cost-effective solution for furnaces with smaller workspaces. Electricity is often the best choice for separate engineering zones of temperature control within a modular furnace. Further, major companies, including International Thermal Systems and Carbolite Gero Ltd., deal in advanced electrically operated industrial furnaces, boosting the market growth.

Based on the arrangement, the global market is divided into the tube or clamshell type, box type, bottom-loading and car bottom furnace, top-loading furnace, and others. 

The box-type segment is the most significant contributor to the market and is estimated to exhibit a CAGR of 5.31% over the forecast period. A box or chamber-type industrial furnace is a box shape furnace with a door on a side. It consists of two chambers: a heat chamber and a work chamber. The material demanding heat treatment is placed in the work chamber, and heat is generated in the heat chamber. In addition, the factors such as simple design, rapid heat generation, and uniform temperature distribution make them a prevalent choice for many processes such as baking, pre-heating, and annealing. Using box-type industrial furnaces, economical operation can be achieved with higher thermal process engineering practices that apply airflow management, advanced insulation material, and custom programming.

A tube or clamshell industrial furnace is either powered by electricity or gas. These furnaces are popular as they are very productive, versatile, and can perform hardening, annealing, and heat treatment; however, they require little maintenance. Usually used for smaller samples, tube or clamshell furnaces are effective for heating as they deliver controlled temperatures all over the furnace and enable a quick temperature change. The rise in demand for natural resources and metals in the developing countries of the Asia-Pacific region, including India and China, has led to the growth of the mining sector in this region.

Based on end-user, the global industrial furnaces market is bifurcated into metals and mining, transportation, oil and gas, chemical, and others. 

The metals and mining segment dominates the global market and is estimated to exhibit a CAGR of 4.7% over the forecast period. The metals and mining sector is one of the most energy-intensive industrial sectors. In the metals and mining industry, industrial furnaces perform various functions, which include smelting, steel making, metal casting, and heat treatment. In addition, industrial furnaces are broadly used all over the globe in different metals and mining businesses for the effective smelting of metals such as steel, silver, aluminum, and gold. Unlike traditional furnaces, induction furnaces can save energy in smelting processes. The growth of the metals and mining segment is driven majorly by a rise in the number of metals processing factories globally and the development of the metals and mining industry.

The transportation industry comprises aerospace, automotive, marine, and military. Industrial furnaces find several uses within the transportation industry; for instance, furnaces are used for heat treatment of aircraft components, military aircraft, military gear, military vehicles, and automotive components. Prominent vendors such as Carbolite Gero Limited and Baker Furnace have introduced industrial furnaces to produce high temperatures for the transportation industry.

Recent Developments

• May 2023- System Technique Industrial Furnaces, a manufacturer of industrial furnaces in Bulgaria, announced that they are investing USD 3.74 million/3.39 million euros in a new facility near the southern town of Kuklen, according to InvestBulgaria Agency (IBA).
• June 2023- PTC collaborated with the French energy company Engie to create a digital duplicate of its industrial furnace to enhance operational sustainability.