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The global xenon market size was USD 200.94 million in 2020. The global impact of COVID-19 has been unprecedented and staggering, with krypton witnessing a negative demand shock across all regions amid the pandemic. Based on our analysis, the global market exhibited a decline of 2.6% in 2020 as compared to the average year-on-year growth during 2017-2019. The market is projected to grow from USD 202.71 million in 2021 to USD 228.96 million in 2028 at a CAGR of 1.8% during the 2021-2028 period. The sudden rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.
Xenon (Xe) is a completely inert gas, which is filled in a tube and emits blue light when exposed to electrical discharge. Although It has very little commercial use, it is considered more preferable than
Rising Production of Medical Oxygen to Hinder Demand
The COVID-19 pandemic has disrupted most of the industrial operations around the world. As a result, consumption of this rare gas fell sharply in 2020. Most of the air separation units that produce rare 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 the weak demand for gas from lamp manufacturers.
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Exploring the Applicability of Xe in the Semiconductor Industry is a New Market Trend
The gas 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 Growth
This inert gas acts as an excellent propellant for the electric ion propulsion system, which 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 the gas 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 rising demand from developed countries for satellite launches is expected to drive the market.
Dangerous Health Effects of the Gas on Human Body is a Major Restraining Factor
The gas is classified as an asphyxiant, which means the 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, and emotional instability. 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, the area must be 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.
Increasing Demand of N4.5 Type in Imaging & Satellite to Augment Market Growth
On the basis of type, the xenon gas market is segmented in N3, N4.5, and N5. The classification among these segments is done based on the purity of the gas.
The N5 segment, which is also known as research-grade xenon, holds a purity level of 99.999%, which makes it extremely costly but extremely useful in various applications such as imaging and lighting, satellite, electronics & semiconductors, and medical. As several private players including Lockheed Martin, SpaceX, and Boeing are planning for space exploration and satellite launch programs in the near future, the demand for this type is projected to inflate over the forecast period.
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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 xenon market share in the global 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 this rare gas is expected to remain healthy from the aerospace industry over the industry forecast period. Several satellites are scheduled for launch during the short-term forecast and many more are expected to be announced in the future, which will steadily raise the demand for Xe 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. The segment is expected to get dethroned from its position by the end of the forecast period because of the reduced demand from consumers for conventional lighting. Though the market for these headlights is expected to decrease, the need 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. The gas 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 is 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 others segment includes research & development work, which also accounts for considerable market size and plays an important role in the study of the nature of dark matter. Liquid Xe is used in such studies, which are quite expensive. The dark matter detection project LUX-ZEPLIN (an international collaboration between large underground inert gas experiment group and ZEPLIN-III dark matter experiment group), alone is expected to consume around 10 tons of this gas after it starts taking data in 2020. However, the demand for research and development and in all the others segment is expected to decline during the industry forecast period as it is very costly and cannot be readily available when required.
Asia Pacific Xenon Market Size, 2020 (USD Million)
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Asia Pacific is anticipated to remain a major consuming region of this market during the forecast period owing to the rising demand from the satellite industry, thus dominating in terms of the market share. There are many satellite launches scheduled in the upcoming years, which are expected to use xenon-based electric propulsion systems. A significant amount of this gas is consumed while testing the 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 mid-2020. The procurement process for high purity xenon 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 gas for etching and other applications. The industry is expected to positively support the xenon market growth over the industry forecast period due to the 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 are expected to showcase low growth in the market value, as compared to other regions. This is due to a fewer number of developments in these end-use markets. Most of the demand in these regions is accounted for by lighting & imaging applications.
Market Players to Focus on Strengthening Positions through Mergers & Acquisitions
The global xenon market is highly consolidated with top-5 players accounting for over 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 positions in major economies. This strategy was adopted to maintain an uninterrupted supply of gas to end-users. Air Liquide is a prominent company operating in the market. After its acquisition of Airgas, a major industrial gas producer in the US, in 2016, it became one of the largest producers of industrial gases in the world. It also acquired SIG Gases in Malaysia to double its capacity for the production of packaged gases. Another key company operating in the market is Messer Group GmbH. It has targeted consolidation of the market in Europe by investing heavily in its Hungary-based operations in the last three years. It currently has over 20+ production sites in the country.
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.
Volume (Million Liters); Value (USD Million)
By Type, By Application and By Geography
Fortune Business Insights says that the market size was USD 200.94 million in 2020 and is projected to reach USD 228.96 million by 2028.
The market will exhibit steady growth at a CAGR of 1.8% in the forecast period.
The satellite segment is expected to lead this market during the forecast period.
The increasing demand for satellites is the key factor driving the market growth.
Asia Pacific is expected to hold the highest share in the market.
Widening applicability in the semiconductor industry is the current market trend.
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