Ammonia Refrigerant Market Overview
Ammonia Refrigerant Market size is forecast to reach $70.12 billion by 2025 after growing at a CAGR of 4.5% during 2020-2025. Ammonia refrigerant is commonly known as R717 and its chemical formula is NH3. It is also the only refrigerant outside the halocarbons group like CFCs, CFHCs. Ammonia has the highest refrigerating capacity per pound of any refrigerant including halocarbons and a number of other excellent thermal properties that make it popular for a number of refrigeration applications. The growth of the market is expected to be driven by the high demand ammonia refrigerant from the food and beverage sector.
Asia-Pacific dominates the ammonia refrigerant market owing to increasing demand from dairy sector.
The cost effective pipe installation and leaks detection are the key things that drives the market growth of ammonia refrigerants market.
Cost effective and leak proof ammonia refrigeration systems will hinder the growth of the market in the forecast period.
By Type – Segment Analysis
Purity 99.8% held the largest share in the ammonia refrigerant market in 2019. Purity 99.8% ammonia is a clear liquid that boils at a temperature of -28°F. In refrigeration systems, the liquid is stored in closed containers under pressure. When the pressure is released, the liquid evaporates rapidly, generally forming an invisible vapor or gas. The rapid evaporation causes the temperature of the liquid to drop until it reaches the normal boiling point of -28°F, a similar effect occurs when water evaporates off the skin, thus cooling it. This is why ammonia is used in refrigeration systems. Purity 99.8% ammonia weighs less than water. About eight gallons of ammonia weighs the same as five gallons of water. This ammonia gas is considerably lighter than air and will rise in dry air. However, because of ammonias tremendous affinity for water, it reacts immediately with the humidity in the air and may remain close to the ground.
By Application – Segment Analysis
Cold Storages held the largest share in the ammonia refrigerant market in terms of application. The demand for convenience foods has raised resulted in the construction of millions of square feet of both public and private cold storage facilities. These cold storage warehouses consist freezers and coolers dependent on ammonia refrigeration systems to control temperatures within the spaces to maintain product quality and freshness until shipped. Ammonia has a high affinity for moisture, and is readily absorbed by many materials. Ammonia refrigeration is used in cold Storage warehouses using synthetic refrigerants, with the major exception being that it uses anhydrous ammonia as the refrigerant. Refrigerant grade anhydrous ammonia is a clear, colorless gas or liquid and about 99.8% pure. The purity of the ammonia is vital to the properties that make it use in cold Storage warehouses. This factor will drive the growth of the cold storage warehouses in the forecast period.
By End Use – Segment Analysis
Automotive sector is the primary market of the ammonia refrigerant in 2019 growing at CAGR of 8.5%. The growth of the ammonia refrigerant market can be attributed to the rise in production of automobiles. It is expected that the amount of ammonia refrigerant used in the automobiles will double in the next 15 years. According to International Organization of Motor Vehicle Manufacturers the total production of automobile (commercial as well as Personal) globally in the year 2019 was 91,786,861 units compare to 96,869,020 units in 2018. Whereas, the total production of automobile (commercial as well as Personal) in Asia-Pacific in the year 2018 was 52,449,078 units compare to 53,395,211 units in 2017. The increase in the global automobile production is a major factor leading to the growth of ammonia refrigerant market in terms of volume across the globe.
The coronavirus pandemic has had far-reaching consequences beyond the spread of the disease and efforts to quarantine it. South Korea, Italy and Japan are the most affected among the major industrialized economies. Consequently, 80 percent of automotive and related companies report that Coronavirus will have a direct impact on their 2020 revenues. 78 percent of companies do not have enough staff to run a full production line. More than 80 percent of the world’s auto supply chain is connected to China. In January 2020 China’s car sales plunged by 18 percent. The China Passenger Car Association (CPCA) considers that the first two-month sales could decline by 40 percent or more compared to the same period in 2019. Production shortfalls resulting from supply chain disruptions in China will impact global automakers. This factor will hinder the growth of market for the year 2020. But after the situation became normal it will grow with a steady rate in the forecast period.
By Geography – Segment Analysis
APAC dominates the ammonia refrigerant market with a share of 42% followed by North America and Europe. The economy of APAC is mainly influenced by the economic dynamics of countries such as China and India, but with growing foreign direct investment for economic development of South East Asia, the current scenario is changing. Countries in South East Asia are witnessing in dairy sector. Increasing demand for dairy products is driven by the growing population, higher income levels, and rising health consciousness. The rising demand for milk and milk-based ingredients is one of the primary factors supporting the market growth. In 2018, the global milk output was valued at 843 million tons, an increase of 2.2% from the value registered in 2017. The increase in the global milk production is a major factor leading to the growth of ammonia refrigerant market in terms of volume across the globe.
Driver – Ammonia Refrigerant Market
Ammonia refrigerant are environment friendly, this factor will drive the growth of market
One of the biggest advantages of ammonia gas as the refrigerant is that it is safe to the environment and does not cause any depletion of the ozone layer. Due to this it won’t have to be replaced with any alternative refrigerants as is the case with number of chlorofluorocarbons (CFCs). Ammonia is the oldest of all the refrigerants being used and it will compete with the new refrigerants for a number of years to come. Now, considering the known environmental concerns with newer refrigerants many are returning to refrigerants like ammonia, which have zero environmental impact. The refrigeration process remains the same regardless of the refrigerant used to transfer heat out of the system. This factor will drive the growth of the market in the forecast period.
Ammonia refrigerant can lower long-term operation costs, this factor will drive the growth of market
According to the International Institute of Ammonia Refrigeration (IIAR), ammonia is 3 to 10% more thermodynamically efficient than competitive refrigerants. This allows an ammonia-based refrigeration system to achieve the same cooling effect while using less power. As a result, where ammonia refrigeration is appropriate, it can offer lower long-term operation costs. This factor will drive the growth of the market in the forecast period.
Challenges – Ammonia Refrigerant Market
Risk of accidental exposure to high concentrations of ammonia will hinder the growth of market in the forecast period
Ammonia has always been a popular choice for Industrial Refrigeration, but now with new regulations and environmental concerns over other refrigerants, there is a renewed focus on ammonia-based systems. The biggest risk that may occur is an ammonia leak, which is both a health and safety hazard. The most common health concerns with ammonia are skin burns and difficulty breathing, as well as death only in the rarest cases. Leaks most commonly occur during the unloading and loading of ammonia, however, careful and considerate design and diligent training of employees can go a long way towards preventing these leaks. It is also important to consider any local regulations that may exist around the use or storage of ammonia prior to considering ammonia as a refrigerant. Some countries and local jurisdictions have regulations surrounding the safe handling of ammonia. This factor will hinder the growth of the market in the forecast period.
Technology launches, acquisitions and R&D activities are key strategies adopted by players in the ammonia refrigerant market. In 2019 the market of ammonia refrigerant market has been consolidated by the top five players accounting for xx% of the share. Major players in the ammonia refrigerant market are Danfoss Group, The Linde Group, Sinochem Group, Dehon Group, National Refrigerants, Inc., and others.
Acquisitions/Technology Launches /Product launches
In January 2017, Airgas, Inc., acquired the assets and operations of Gartech Refrigerant Reclamation Center, Inc. Airgas Specialty Products, a leader in the distribution of industrial ammonia, process chemicals, and refrigerants.