Insulated metallic cable market grew only 1.8% in 2015
CRU estimates that the global insulated metallic wire and cable market grew by just 1.8% in 2015, following a weaker than expected Q4 2015. This growth is well below the long term average growth rate for insulated metallic wire and cable of 3.3%.
Market growth was dragged down by a big fall in the Russian market and also falling demand in other important markets such as Brazil, Australia, Japan, France and Canada.
In contrast to the metallic cable sector the fibre optic market had another good year with global consumption rising by 16.4%. This strong growth was driven by a 29% rise in the large Chinese market, with Europe being the only major region to see a fall in demand.
It is not surprising that the total value of the global insulated wire and cable market fell sharply, down by 10.0%. This is mainly the result of a 20% fall in the average copper price and a 10% decline in the average aluminium price, plus a nearly 50% fall in the average oil price which impacts on polymer and transport costs.
This was the fourth consecutive year of falling market value and means that the market has fallen by just over 17% since 2011. We are forecasting a modest increase in the growth rate for the global insulated metallic cable market in 2016, but it will not be until 2017 that this gets back to long term trend rates. For the fibre optic cable market we are forecasting slower growth this year at under 10%, and this slowdown in growth is expected to continue in 2017.
A more detailed review of the global cable market with a range of detailed statistics, can be found in CRU's Wire & Cable Market Outlook, which was published end-January 2016. The report also covers two regions of the world in more detail in each issue with the regions in the latest report being India and the ASEAN region, which covers Indonesia, Malaysia, Thailand, Vietnam, the Philippines and Singapore. Below is a further extract from the report.
India is the third largest metallic wire and cable and fibre optic cable market in the world by total conductor weight or fibre km. After a slowdown in the economy which saw a fall in the market for insulated metallic cables in 2013, there was a return to growth in 2014 and stronger growth in 2015 meant that India was the fastest growing major market in the world last year.
With total consumption in 2015 only around 17% that of the Chinese market, there is clearly good potential for continued strong growth as long as there are no shocks to the economy. Polycab remains the clear market leader and is the only company with a market share of over 5%, which illustrates the fragmented nature of the cable industry in India.
After a mixed 2014, last year was a better year for the ASEAN cable industry with all the six countries covered other than the Philippines, showing growth in insulated metallic wire and cable consumption.
This meant that the region as a whole posted a 5.2% rise in the metallic cable market, with the fibre optic cable market up by 9.0%. Thailand was the largest market in 2015 by total value followed by Malaysia and Indonesia, but the strongest growth over the last few years has been in Vietnam.
Although market volumes increased in 2015, the total market value fell on lower copper and other raw material prices. With most companies in this region only operating in one market the overall industry is very fragmented, with the largest regional manufacturer, Sarawak Cable of Malaysia, only having a 4% share of total production. Six of the eight largest regional producers are locally owned with the other two being controlled by South Korea's LS Cable and Japan's Yazaki.