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The global xenon market size was USD 195.9 million in 2019 and it is estimated to reach USD 226.7 million by 2027, exhibiting a compound annual growth rate (CAGR) of 1.7% during the forecast period.
Xenon (Xe) is a completely inert gas and when filled in a tube emits blue light, when excited by electrical discharge. It has very little commercial use and it is mostly preferred in lamps that illuminate road signs and markings and is therefore much better than other conventional lightings. It is a trace gas in the earth’s atmosphere, which occurs in 1 part of 20 million and the only commercial source is from industrial liquid air plants. The demand for this gas is rising owing to its increasing consumption in satellites.
COVID-19 to Impede Market Growth in the Short-Term Forecast
The COVID-19 pandemic has disrupted most of the industrial operations around the world. As a result, Xe consumption is estimated to fall sharply in 2020. Most of the air separation units that produce Xe, along with other gases, are engaged in the production of medical oxygen as COVID-19 cases are rising exponentially. Hospitals and governments around the world are building up their inventories to avoid any shortages in the near future as COVID-19 cases are expected to rise.
In countries such as India, even industrial oxygen cylinders are being called off for converting them into medical oxygen. Xenon-based medical lighting systems are prominently used in hospitals around the globe for a variety of applications including surgical operations. However, the pandemic has disrupted most hospital operations as the majority of healthcare manpower is being utilized for the treatment of COVID-19 patients. This has resulted in weak demand for gas from lamp manufacturers.
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Exploring the Applicability of Xe in the Semiconductor Industry is the New Market Trend
Xe in the form of Xenon chloride (XeCl) plays an important role in excimer lasers, which are used in the semiconductor industry. In plasma etching, which is a process in the production of semiconductors, a high frequency or electrode-less microwave discharge is ignited in the vacuum reactor. The reactor is filled with Xe gas, which is highly reactive, and thus etching-active plasma is generated. In 2018, Samsung practiced the 3D photolithography process for the semiconductor industry, which requires a significant amount of this gas.
Staggering Demand for Satellites to Fuel the Market
Xenon is an excellent propellant for the electric ion propulsion system that is gaining significant traction in the satellite industry. From satellite launches to interplanetary operations, electric propulsion has been playing an important role in space exploration and is widely increasing. Weight reduction is one of the prominent advantages of using this gas as a propellant. It enables the spacecraft to carry more payloads. Moreover, high ionization promoted by it makes it an ideal choice for moving between heliocentric orbits. The U.S., China, and Russia are the countries that have launched the majority of satellites till 2019 and are expected to remain the key countries for satellite launches. The rise in demand from the developed countries for satellite launches is expected to drive the market.
Health Effects of Xenon on the Human Body is a Major Restraining Factor
The Xe gas is classified as an asphyxiant, which means inhalation of excess concentration of this gas can result in nausea, dizziness, vomiting, and sometimes, death. At low oxygen levels, death may occur within seconds without warning. At 75% of oxygen and 25% of this gas, the person may develop symptoms mentioned above, but it may also lead to mental illness, fatigue, depression, emotional instability, and also death. The European Industrial Gases Association (EIGA) and the U.S. Occupational Safety and Health Administration (OSHA) passed the rule that places where rare gases such as argon, helium, krypton, and xenon are kept, oxygen should be limited between 20% and 25%. If there is any doubt about the oxygen level uncertainty, it is prohibited to enter. Although the ambient level of oxygen is present, adequate ventilation should be there for the entrance of fresh air to avoid any disaster.
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Satellite Segment to Generate the Highest Revenue
On the basis of application, the market is segmented into imaging and lighting, medical, satellite, electronics & semiconductors, R&D, black matter research, and others. The satellite segment holds the largest share in the market and is expected to grow at a CAGR of 9.9% by the end of the forecast period. With the increasing number of electric propulsion spacecraft & satellites, the demand for Xe is expected to remain healthy from the aerospace industry over the forecast period. Many satellites are scheduled for launch during the short-term forecast and many more are expected to get announced in the future, which will steadily raise the demand for this gas. Some of the announced spacecraft and satellite missions include Hotbird 13F (2021), Hotbird 13G (2021), SES-17 (2020), GSAT-20 (2020), etc.
The imaging and lighting segment holds a prominent market, but it is markedly shrinking, owing to the increasing adoption of LED technology. It is expected to get dethroned from its position as consumers reduce their demand for conventional lighting by the end of the forecast period. Though the market for these headlights is expected to decrease, the market for flash lamps and tubes is still expected to grow moderately owing to their sound demand in projectors and other applications.
The electronics & semiconductor segment is poised to be one of the fastest-growing segments in the market. Xenon is primarily consumed in the semiconductor industry for the etching process. Some of the leading gas manufacturers also provide gas recovery systems to the semiconductor industry to reduce the overall cost by up to 50% or more.
The medical segment is also one of the fastest-growing segments as Xe is highly effective anesthesia and neuro-protector. The medical-grade of this gas requires high purity of 99.9999% and it is medically considered to have ideal anesthetic properties as it is reported to have no side effects and fast response time. Around 3-4 minutes are sufficient to make patients unconscious. Usually, after 2-3 minutes, after the cessation of the gas supply, patients are restored to consciousness without any side effects.
The research & development work also accounts for considerable market size and plays an important role in the study of the nature of dark matter. Liquid xenon is used in such studies, which is quite expensive. The dark matter detection project LUX-ZEPLIN (an international collaboration between large underground xenon experiment group and ZEPLIN-III dark matter experiment group) is alone expected to consume around 10 tons of this gas after it starts taking data in 2020. However, the demand for research and development is expected to decline during the forecast period as it is very costly and cannot be readily available when required.
Asia Pacific Xenon Market Size, 2019 (USD Million)
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Asia Pacific is anticipated to remain a major consumer of Xe during the forecast period owing to the rising demand in the satellite industry, thus dominating the market share. There are many satellite launches scheduled in the upcoming years which are expected to use Xe-based electric propulsion systems. A significant amount of this gas is consumed while testing these engines as well. This is expected to create lucrative opportunities for the market over the forecast period. For instance, the GSAT 20 is set to be launched by the Indian Space Research Organization (ISRO) in 2020. The procurement process for high purity xenon had been started in 2018 for testing and quality inspection purposes. ISRO has also made a few satellite launches (GSAT 9, GSAT 4) in the past that used Xe-based electric propulsion systems. China and Japan are also prominent countries that consume a significant amount of Xe for satellite applications. Further, electronics & semiconductor industries in the region account for high consumption of the gas for etching and other applications. The industry is expected to positively support the market growth over the forecast period due to increasing electronic & semiconductor production.
Europe is projected to witness moderate growth in the market. Semiconductors and satellite applications are expected to remain the major growth promoters for the regional market. The ongoing dark matter research in Italy is also expected to create growth opportunities due to the high consumption of gas. The third-generation experiment uses three and a half tons of xenon to catch the passing weakly interacting massive particles (WIMPs).
Latin America and the Middle East & Africa regions are expected to showcase low growth in market value as compared to the other regions. This is due to the less number of developments in the end-use markets. Most of the demand in these regions is accounted for by lighting & imaging applications.
Market Titans to Focus on Strengthening Position through Mergers & Acquisitions
The global xenon market is highly consolidated, with top-5 players accounting for more than 85% of the market share. The merger & acquisition strategy by top manufacturers has changed the competitive landscape of the market to some extent. Key players have strengthened their market position in the major economies. This strategy is adopted to maintain an uninterrupted supply of the gas to the end-users.
An Infographic Representation of Xenon Market
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The xenon market research report provides both qualitative and quantitative insights into the global market. Quantitative insights include the global market sizing in terms of value (USD Million) and volume (Million Liters) across each segment, sub-segment, and region profiled in the scope of the study. Additionally, the report covers historical data, market share analysis, and growth rates of the segment, sub-segments, and key countries across each region. Qualitative insights cover an elaborative analysis of the drivers, restraints, growth opportunities, and key trends related to the market. The competitive landscape section covers detailed company profiling of the key players operating in the global market.
Value (USD Million); Volume (Million Liters)
Application; and Geography
Fortune Business Insights says that the market size was USD 195.9 million in 2019 and is projected to reach USD 226.7 million by 2027.
The market will exhibit steady growth at a CAGR of 1.7% in the forecast period (2020-2027).
The satellite segment is expected to be the leading application segment for this market during the forecast period.
Increasing demand for satellites is driving the market growth.
Asia Pacific is expected to hold the highest share in the market.
Widening applicability in the semiconductor industry is the key market trend.
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