Marketing agency MegaResearch conducted an analysis of the market of water and wastewater treatment systems in terms of spread of coronavirus infection and a strong decline in world oil prices. According to experts, in the period from 2020 to 2022, the market can develop according to different scenarios depending on objective factors and the actions of state authorities.
The development of the Russian market for water treatment plants in the past five years was largely determined by the strengthening of state environmental control and an increase in fines for non-compliance with existing standards. Large industrial enterprises were forced to invest heavily in the modernization of their treatment facilities, so the industry coped with the crisis of 2014–2016 relatively calmly. The accumulated safety margin and a relatively low level of import dependence suggest that in the context of the spread of coronavirus infection and a strong decline in world oil prices, the market will be able to function without serious shocks, especially since domestic manufacturers have the opportunity to completely replace foreign products with their new developments.
Market stability in crisis situations
According to analysts, the water treatment systems market is going through periods of economic crises relatively calm. This happens for several reasons:
1. A small share of imports. Approximately 20% of components in water treatment systems are of foreign origin, the rest is the products of Russian companies.
2. Strict environmental requirements. According to market participants, fines for violations of the requirements for the quality of discharged water have increased tenfold over the past year, so the installation of treatment facilities is becoming economically profitable. If earlier about 30% of enterprises preferred to pay fines (it was cheaper), and about 50% tried to use existing loopholes in the legislation, then in a survey of market participants conducted in 2019, 45% announced plans to install or modernize a water treatment system ...
3. Obsolescence of equipment. Most of the systems currently in use were installed 20 or more years ago. Since the financing of environmental programs in the early 2000s was carried out on a leftover basis, the technologies used in these systems were developed in the last century.