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The global xenon market size was valued at USD 203.92 million in 2021. The market is projected to grow from USD 247.86 million in 2022 to USD 286.42 million by 2029, exhibiting a CAGR of 2.1% during the forecast period. Based on our analysis, the global xenon market exhibited an average growth of 2.4% in 2020 as compared to 2019.
Xenon (Xe) is a completely inert gas filled in a tube and emits blue light when exposed to electrical discharge. Although it has very less commercial use, it is considered preferable owing to its excellent characteristics. This noble gas is versatile and based on its purity, it is widely adopted in different industries such as satellites, imaging, lighting, electronics, medical and others. Owing to the favorable growth of these applications in both developed and developing economies, the demand for xenon gas is expected to increase during the forecast period.
Rising Production of Medical Oxygen Hindered Xe Demand
The COVID-19 pandemic disrupted industrial operations globally. As a result, demand for rare gases felt sharply in 2020. Most of the rare gas producing air separation units were majorly engaged in producing medical oxygen as COVID-19 cases were rising exponentially. Governments and hospitals around the world were building their inventories to avoid any shortages in the near future as COVID-19 cases were projected to rise.
In countries, such as China, India, the industrial oxygen cylinders were called off and converted into medical oxygen. Xenon-based medical lightings are prominently used in hospitals for different applications such as surgical operations. However, the outbreak disrupted operations in most hospital as major manpower was utilized to treat COVID-19 patients. This factor resulted in a weak demand for Xe gas from lamp manufacturers.
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Rising Demand for Xe in the Semiconductor Industry to Aid Market Growth
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 highly reactive Xe gas, thereby generating etching-active plasma. In 2018, Samsung practiced the 3D photolithography process for the semiconductor industry, which requires a significant amount of this gas.
Robust Adoption of Satellites to Bolster Market Growth
Xe is an inert gas that is an excellent propellant for the electric ion propulsion system. It is gaining considerable traction in the satellite sector due to its advantages. Electric propulsion plays a crucial role in interplanetary operations, electric propulsion plays an important role in space exploration. Weight reduction is the major advantages of using this gas as a propellant. It enables the spacecraft to carry more payloads. Also, the high ionization promoted by the gas makes it an ideal choice for moving between heliocentric orbits. U.S., China, and Russia launched several satellites by 2019 and are likely to offer the key countries for satellite launches. The increasing adoption of the gas from developed countries for satellites is likely to drive the market.
Dangerous Health Effects of the Gas on the Human Body to Restrain Market Progress
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% oxygen and 25% of this gas, the person may develop the 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 stating that oxygen levels in places where rare gases are stored should range between 20% and 25%. Entry to the area must be prohibited in case of oxygen level uncertainties. Although the ambient level of oxygen is present, adequate ventilation should be there to enter fresh air to avoid any disaster.
Growing Demand for N5 Type in Imaging & Satellite to Augment Market Growth
On the basis of type, the xenon market share is categorized as N3, N4.5, and N5. The classification among these segments is done based on the purity of the gas.
The N5 segment, also known as research-grade, holds a purity level of 99.999%, making it extremely costly but useful in applications such as imaging, lighting, satellite, electronics & semiconductors, and medical. As several key private players, including SpaceX, Lockheed Martin, and Boeing planned for space exploration and satellite launch programs in the near future, the demand for N5 type is expected to improve during the xenon industry forecast period.
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Due to Higher Adoption, the Satellite Segment Dominated the Market in 2021
On the basis of application, the market is segmented into imaging & lighting, medical, satellite, electronics & semiconductors, and others. The satellite segment held the lions share in the market and is projected to grow at a CAGR of 7.6% during the study period. With increasing number of electric propulsion spacecraft & satellites, the demand for Xe gas is expected to grow. Several satellites are scheduled for launch during the short-term forecast, and many more are expected to be announced in the future. Some of the announced spacecraft and satellite missions include Hotbird 13F (2021), Hotbird 13G (2021), SES-17 (2020), GSAT-20 (2020), and others.
The imaging & lighting segment accounted for the prominent market share, but it is markedly shrinking due to the increasing adoption of LED technology. This segment is expected to get dethroned due to the reduced demand from conventional lighting. Though the demand for these headlights is expected to decrease, the need for flash lamps & tubes is still expected to grow moderately, owing to their strong demand in projectors and other applications.
The electronics & semiconductor segment is the fastest growing segments in the global market. The gas is mainly consumed in the semiconductors for the etching process. Some leading gas producers also provide gas recovery systems to the semiconductor industry to reduce the overall cost by up to 50% or more.
The medical grade gas requires high purity of 99.9999% and is ideal anesthetic gas 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 studying the nature of dark matter. Liquid xenon is used in such studies, which are quite expensive. The dark matter detection project LUX-ZEPLIN (an international collaboration between a 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 the other segments is likely to decline during the forecast period as it is very costly and cannot be readily available when required.
Asia Pacific Xenon Market Size, 2021 (USD Million)
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Asia Pacific is a major consumer owing to the rising demand from the satellite industry. The market size of the region in 2021 was USD 74.80 million. Many satellite with xenon-based electric propulsion systems are scheduled to launch in the coming years. A significant amount of this gas is also consumed while testing the engines. For instance, the GSAT 20 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) that used Xe-based electric propulsion systems.
China and Japan are prominent countries that consume a significant amount of Xe for satellite applications. Electronics and semiconductor industries account for high gas consumption for etching and other applications. The growth of electronics industry is expected to positively support the xenon market growth due to increasing semiconductor production.
Europe is expected to witness moderate growth in the market. Semiconductors and satellite applications are expected to remain the major growth promoters for the local market. The ongoing dark matter research in Italy is also expected to create growth opportunities. 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 market value growth compared to other regions. This factor is attributable to fewer 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 market is highly consolidated, with top-5 players accounting for over 85% of the market share. Leading key players strengthened their positions in major economies. This merger strategy was adopted to maintain an uninterrupted supply of gas to end-users. The Air Liquide is a prominent player operating in this market. Post-acquisition of Airgas, it became a major industrial gas producer in the U.S., and in 2016, it became one of the largest producers of industrial gases. Further, the company also acquired SIG Gases in Malaysia to double its production capacity for packaged gases. Messer Group GmbH is another key company operating in the market. The company targeted 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.
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The market research report provides qualitative and quantitative insights into the global market based on a holistic research methodology. 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 market trends related to the market. The competitive landscape section covers detailed company profiling of the key players operating in the global market and their SWOT analysis.
Volume (Million Liters), Value (USD Million)
By Type, Application, and Region
Fortune Business Insights says that the market size was USD 203.92 million in 2021 and is projected to reach USD 286.42 million by 2029.
The market will exhibit steady growth at a CAGR of 2.1% 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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