GCC Wires and Cables Market Research Report: Forecast (2021-2026)
A wire is a single conductor, and the cable is the group of wires bundled together in an assembly and wrapped in a single jacket to allow the flow of charge through it. Several types of cables are used for transmitting communication signals and electric power across different verticals. The mounting demand from the power distribution industry and massive investments in smart grid projects are leading to the increasing production of wires & cables across GCC nations.
The GCC Wires and Cables Market is anticipated to grow at a CAGR of around 15% during the forecast period, i.e., 2021-26. Wires & cables are a crucial part of infrastructure development. Hence, rapid infrastructural developments across GCC nations are projected to drive the market. In addition to this, various government initiatives and emphasis on generating power from renewable sources have also fueled the adoption of wires & cables.
Moreover, the surging demand for refined power transmission & distribution systems is another crucial factor that shall boost the market. Wires & cables are used in several applications to transmit electric signals. Rising urbanization & robust government support to expand power distribution networks across different areas are also likely to propel the overall market growth during 2021-26. Besides, increasing projects in the residential & commercial sector, coupled with the soaring demand for uninterrupted electricity, are other crucial factors proliferating the market growth.
Furthermore, snowballing investments in smart grid projects have surged the need for grid interconnection and, in turn, fueled the wires & cables market growth. Apart from this, increasing demand for underground cables is also contributing to the overall market growth in the coming years.
|Study Period||Historical Data: 2016-19|
|Base Year: 2020|
|Forecast Period: 2021-26|
|Key Companies Profiled||Riyadh Cable, Jeddah CableBahra Cables, Al Fanar Electrical Systems, Dubai Cable, Power Plus Cables, National Cable Industry, Oman Cables Industry (OCI), QICC Cables, Doha Cables|
|Unit Denominations||USD Million/Billion|
Impact of Covid-19 pandemic on the GCC Wires and Cables Market
The Covid-19 pandemic in 2020 catastrophically impacted most industries across the GCC region. Governments of various nations across the region imposed lockdowns & movement restrictions that led to the shutdown of manufacturing units & delays in construction projects, which, in turn, negatively impacted the Wires & Cables Market.
The demand for wire and cables witnessed a significant decline amidst the pandemic. Wuhan is the largest concentration of the fiber optics supply chain. As a result, during the initial phase of the pandemic, the market witnessed adverse effects.
However, due to mounting inclination toward online classes, work-from-home policies, and the introduction of telehealth amidst the pandemic, there was a paradigm shift of people toward communication technologies, which surged the need for better connectivity and communication. Also, the continuous progress in 5G deployments despite the pandemic & economic downfall has been contributing to the market growth. Furthermore, the demand for wires & cables from the automotive & aviation sector has remained stable & is increasing steadily after the upliftment of lockdown, which, in turn, is propelling the overall market growth.
Based on the material, copper is projected to hold the largest share of the GCC Wires and Cables Market during the forecast period. It is due to the increasing demand for copper-based wires & cables from the telecommunication & consumer electronics sector since copper is an excellent conductor. In addition, the burgeoning growth of the construction industry due to snowballing infrastructural developments is also expected to boost the demand for copper-based wires & cables in the coming years.
Moreover, copper exhibits properties like less resistance against the electric current. This property makes it an outstanding choice for wires used in homes & commercial spaces. Apart from this, copper used in single conducting cable connecting wires delivers excellent durability, strength, & insulation.
Furthermore, the demand for Aluminum-based wires & cables is anticipated to witness the fastest growth during the forecast period. It is due to the increasing number of projects from events & expos and construction of power plants. In addition, aluminum, i.e., nearly 70% lighter than copper, is beneficial in various applications where components with reduced weight are required. Moreover, aluminum-based wires are used in electrical cables, owing to their lightweight, which makes them easier to install.
Based on Installation, Overhead installation acquires the largest share of the GCC Wires and Cables Market. It is the traditional approach of installing wires and cables since it is easier & cheapest than other installation types. In addition, it is easier to troubleshoot & upgrade overhead wires & cables, while it is not the same in the case of underground cables.
However, the demand for Underground installation is projected to experience robust growth in the forecast period. This installation, despite being expensive, exhibits several advantages. It is used widely in densely populated areas, where it is dangerous to have overhead lines. Furthermore, underground installation helps reduce maintenance costs & incurs fewer transmission losses. Therefore, the underground installation is likely to experience significant demand from various verticals, including commercial, residential, telecom, automotive, and energy & power industries. Apart from this, underground cables are safer for the public, animals, & the environment compared to overhead lines.
Key Trends in the GCC Wires and Cables Market
With increasing environmental concerns, the awareness regarding the potential of renewable power is increasing dramatically. Therefore, the demand for power generation from renewable sources is increasing, which, in turn, is fueling the requirement for wires and cables. In addition to this, rising government emphasis on developing renewable power plants is another crucial factor propelling the Wires and Cables Market growth across GCC nations.
Governments of GCC countries are trying to establish numerous commercial offices in UAE & Saudi Arabia to make them the business hubs. It is fueling the need for more data centers & IT facilities for improved security, which, in turn, increases the connectivity of IT infrastructure. Hence, the need for wires & cables in these countries is significantly surging for infrastructural developments & supporting businesses.
Of them all, Saudi Arabia captures the largest share of the GCC Wires & Cables Market. Its major income-generating sector is the oil industry. Hence, to reduce dependency on the oil sector & diversify income resources, the Saudi government and leading authorities are encouraging infrastructural & industrial developments within the country. As a result, growing infrastructural developments are likely to increase the number of construction projects, which, in turn, will fuel the demand for wires & cables across the residential, industrial, & commercial sectors, thereby fueling the market growth.
Further, the rising population is also leading to the increasing need for constructing new buildings, which is another crucial aspect positively influencing the market growth in Saudi Arabia. Additionally, the mounting focus on making the country a business hub, coupled with the increasing number of constructions of commercial spaces, is also anticipated to boost the market in Saudi Arabia. Moreover, burgeoning demand for high voltage cables in industries like oil & gas, power distribution, telecommunication, aerospace & defense, etc., shall further fuel the growth of the wires & cables market in Saudi Arabia during 2021-26.
Key Driver: Increasing Demand for Wires & Cables in Industrial Sector
Rapid urbanization across the GCC region is escalating the need for constructing more residential & commercial spaces. This astronomical increase in construction projects is fueling the demand for wires & cables to fulfill the increasing power requirements. Besides, the need for power grid interconnection in densely populated areas is also propelling the demand for wires & cables. Moreover, rising developments in the industrial sector are amongst other crucial factors boosting the market growth, owing to the increasing requirement of high-voltage cables in industries like oil & gas, aerospace, and telecommunication.
Possible Challenge: Surging Prices of Raw Materials
The most essential raw materials used in making wires & cables are rubber & plastics that include ingredients like PVC grains. The surge in raw material prices directly affects the profit margin of manufacturers, which might hinder market growth in the coming years. In addition, mounting procurement & operational costs of specialty wires and cables and snowballing usage of wireless devices are other crucial aspects projected to restrain the growth of the GCC Wires & Cables Market.
According to MarkNtel Advisors, the major leading players in the GCC Wires and Cables Market are Riyadh Cable, Jeddah CableBahra Cables, Al Fanar Electrical Systems, Dubai Cable, Power Plus Cables, National Cable Industry, Oman Cables Industry (OCI), QICC Cables, Doha Cables.
Key Questions Answered in the Market Research Report:
Market Outlook, Segmentation, and Statistics
Frequently Asked Questions
A. The GCC Wires and Cables Market is projected to grow at a CAGR of around 15% during 2021-26.
A. The surge in raw material prices directly affects the profit margin of manufacturers, which might hinder market growth in the coming years
A. Saudi Arabia captures the largest share of the GCC Wires & Cables Market