Metal Valve Manufacturers

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 950 metal valve manufacturers in the US produce devices that control, regulate, or isolate the flow of fluids and gases. Major valve categories include automated; ball; gate, global, and check; industrial butterfly; plug; and pressure relief. Large firms typically manufacture complementary products, such as pipes, fittings, instrumentation, control systems, and pumps. Customer industries include chemical; water and wastewater; petroleum production and refining; power generation; oil and gas transmission; pulp and paper; commercial construction; and food and beverage.

Dependence on the Health of Customer Industries

Demand for metal valves is heavily dependent on the health of end-use markets, such as the petroleum, chemical, and water/wastewater industries.

Foreign Production and Competition

Many large firms have operations and business in foreign countries, exposing them to changes in trade policy, fluctuations in currency rates, and uncertainty due to political instability.

Industry size & Structure

The average metal valve manufacturer employs between 55 and 110 workers and generates between $18 million and $53 million annually.

    • The metal valve manufacturing industry consists of about 950 firms that employ 90,000 workers and generate over $30 billion annually.
    • The industry is highly concentrated; the top 50 companies account for between 80% and 99% of revenue, depending on the category.
    • Large US firms include divisions of Emerson (Fisher), Parker Hannafin, and Crane, Mueller Water Products, and Watts Water Technologies. The industry also includes large multi-national conglomerates headquartered in foreign countries.
    • The North American valve manufacturing industry supplies about 35% of worldwide valve demand, according to the Valve Manufacturers Association (VMA).
                                  Industry Forecast
                                  Metal Valve Manufacturers Industry Growth
                                  Source: Vertical IQ and Inforum

                                  Recent Developments

                                  Mar 6, 2023 - Upgrades to Water Infrastructure
                                  • The Biden administration in February announced $2.4 billion for clean water infrastructure upgrades through the bipartisan Infrastructure Law, according to the US Environmental Protection Agency. The funding is intended to support communities in upgrading essential water, wastewater, and stormwater infrastructure. Nearly half of funds allocated will be available as grants or principal forgiveness loans helping underserved communities across America invest in water infrastructure. Overall, the Infrastructure Law makes over $50 billion available for water and wastewater infrastructure improvements across the US between FY2022 and FY2026. Valves play a vital role in municipal water systems and delivering water to homes.
                                  • Hefty profits fueled by last year’s soaring energy prices are causing global energy companies to dial back their shift to low-carbon energy and increase spending on oil and gas production, The Wall Street Journal reports. BP reported a profit in the fourth quarter of $4.8 billion and $27.7 billion for the year, bringing the combined profits reported so far for 2022 by the biggest Western oil companies -- including Exxon Mobil, Chevron and Shell -- to more than $159 billion, according to WSJ. BP’s chief executive explained the company’s shift from aggressively moving away from fossil fuels to increasing spending on oil and gas production as “responding to what society wants.” BP now aims to reduce fossil-fuel production by 2030 by around 25% from 2019 levels vs its previous aim to cut that output by 40% during the same period.
                                  • Manufacturing activity contracted in January for the third consecutive month, according to data from a purchasing managers survey. The January S&P Global US manufacturing PMI reading reflects companies slowing outputs to better match subdued demand in the first half of 2023. The PMI declined to 47.4%, 1% lower than the seasonally adjusted 48.4% recorded in December. The reading is the lowest since May 2020, when it registered a seasonally adjusted 43.5%. The index suggests factory activity shrank again in January as any reading below 50.0 indicates contraction. The New Orders Index remained in contraction territory at 42.5%. The Production Index reading of 48% is a 0.6% decrease compared to December's seasonally adjusted figure of 48.6%.
                                  • Valve manufacturers that count petroleum producers among their customers may be doing more business closer to home as two of the US’s largest oil companies focus their activities on the Americas, The Wall Street Journal reported in January. To pacify investors upset over poor returns, Exxon Mobil and Chevron have announced plans to spend most of their annual budgets in the Americas in 2023, with Chevron saying it will invest 70% of the capital allocated for production into oil fields in the US, Argentina, and Canada, and Exxon saying it will spend a similar portion of its budget in the Permian Basin of New Mexico and West Texas, Guyana, Brazil and liquefied natural-gas projects, according to WSJ. The oil companies' renewed local focus is expected to continue for years as they prioritize growing shareholder returns and retreat from costly big international drilling projects.
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