The growing demand for fertilizers from farmers and expansion of the crude oil refining industry are creating a significant requirement for hydrogen globally. Hydrogen is used for the production of ammonia, which is then used to create nitrogen-based fertilizers. In addition, the increasing number of regulations to reduce the sulfur content in crude oil, in order to protect the environment, is generating a high demand for hydrogen. Owing to such factors, the hydrogen market is expected to demonstrate a CAGR of 4.3% during the forecast period (2020–2030), to reach $196,934.5 million by 2030.
The coronavirus pandemic has created an adverse impact on the global hydrogen market, by disturbing the supply chain and halting manufacturing activities globally. Hydrogen production requires a well-maintained supply chain, because the feedstock is a major factor which decides the cost of hydrogen. Since the global supply chain has been disturbed owing to the lockdowns and border closures, the feedstock price has been affected too. Further, chemical, refining, and steel plants, where hydrogen finds application, have been shut down or are working at a reduced capacity, which is further ill-affecting the market.
Based on production process, the hydrogen market is categorized into steam–methane reforming, coal gasification, partial oxidation, electrolysis, and others. Among these, the steam–methane reforming category dominated the market during the historical period (2014–2019), owing to the wide adoption of this process among leading hydrogen-producing companies due to its low cost and high operational efficiency, as well as the established natural gas supply chain.
On the basis of distribution method, the hydrogen market is categorized into on-site generation, cylinder, and tanker. Among these, the on-site generation category captured the largest market share during the historical period, and it is expected to showcase the fastest growth during the forecast period. This is because transporting hydrogen this way is less complicated than using tankers and cylinders. Further, this method eliminates the risks involved with the supply chain, such as low supply due to border closure or unfavorable environment conditions, as the hydrogen, in this method, is produced near the end-use factory and transported by pipelines.
Geographically, the hydrogen market in Asia-Pacific (APAC) is expected to witness the highest demand in the coming years, on account of the increasing chemical production and crude oil refining activities in the region. Further, the rising investments and initiatives in the fuel-cell vehicle market are propelling the growth of the hydrogen market. In addition, the large consumer base for fertilizers in the region, in countries including China and India, is boosting the demand for ammonia, thereby propelling the requirement for hydrogen.
Key players in the hydrogen market are using the merger and acquisition model to increase their business and gain a larger market share. For instance, in November 2019, Iwatani Corporation of America, a subsidiary of Iwatani Corporation, acquired Advanced Specialty Gases, based in Reno, Nevada. This acquisition helped the former extend its capabilities to serve customers in strong and growing markets and enter the U.S.
In addition, in October 2019, Linde Plc acquired a minority stake in U.K.-based polymer electrolyte membrane (PEM) manufacturer ITM Power Plc. The acquisition helped Linde Plc increase its presence in the renewable hydrogen production market.
Some of the key players operating in the global hydrogen market areAir Products and Chemicals Inc., Linde Plc, Air Liquide S.A., Showa Denko K.K., Messer Group GmbH, Yateem Oxygen, Iwatani Corporation, SOL SpA, Air Water Inc., and Nel ASA.