Food & Beverage Industry Taps Into Modern Water Solutions


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An analyst briefing about the food and beverage industry in conjunction with modern water solutions.

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Food & Beverage Industry Taps Into Modern Water Solutions

  1. 1. Food & Beverage Industry Taps into Modern Water Solutions Water Footprint Focus will Drive Growth in the Global F&B Water and Wastewater Treatment Market to about $5 Billion by 2020 Paulina Szyplinska, Research Analyst Environment & Building Technologies April 3rd 2012© 2012 Frost & Sullivan. All rights reserved. This document contains highly confidential information and is the sole property ofFrost & Sullivan. No part of it may be circulated, quoted, copied or otherwise reproduced without the written approval of Frost & Sullivan.
  2. 2. Today’s Presenter Paulina Szyplinska, Research Analyst Environment & Building Technologies Frost & Sullivan Market research expertise in: - Monitoring and analyzing emerging trends, technologies and dynamics in the water and environmental markets - Strategic analysis - Opportunity assessment Experience base covering broad range of sectors: - Water and Wastewater Treatment Markets in CEE and Russia - Design-Build-Operate Opportunities in the Global Water Market - Strategic Water Management in the Global Mining and Food & Beverage Industries 2
  3. 3. Focus Points Focus Points Water as an Integral Part of Food & Beverage Production Key Market Forces Impacting the Global Food & Beverage Water & Wastewater MarketFood & BeverageIndustry Taps Market Size and Revenue Forecasts until 2020into Modern Treatment Solutions Related to Food & BeverageWater Solutions Water and Wastewater Treatment Mega Trends Impacting Water and Wastewater Treatment Opportunities in the Food & Beverage Industry Where to Look for Investment Opportunities? Recommendations for Market Participants Strategic Conclusions 3
  4. 4. Water Intensive Food & Beverage Sectors Food & Beverage Production Requires Good Quality Water in the Input Streams and Efficient Discharge Purification Sector Global Water Footprint Water Intensive Food & Beverage Meat Processing SectorsFood and Beverage Water and Wastewater Dairy ProductsTreatment Equipment Revenue Share by Sector, Global, 2011 Fruits & Vegetables Processing Soft Drinks & Bottled Water Brewing, Wine & Spirits Cooking Oils & Fats Note: Other includes prepared food, confectionary & bakery products. All figures are rounded. The base year in Key: High Medium Low 2011. Source: Frost & Sullivan analysis. Source: Frost & Sullivan analysis. 4
  5. 5. Key Market ForcesGlobal Trends Have a Strong Impact on Water and Wastewater Solutions Developmentin the Food & Beverage Industry Global Trends Impacting Food & Beverage Water and Wastewater Market Global Trends Impact on Food & Beverage Water and Wastewater Market Globalization, Population Growth Urbanization & Changing Economies Voluntary Water Conservation Development of Water Programmes by Tier and Wastewater 1 Food & Solutions in the Food Climate Change & Beverage & Beverage Industry Water Scarcity Companies / Associations Increasing Food, Energy & Water Declining Water Prices Quality Source: Frost & Sullivan analysis. 5
  6. 6. How Demand for Food Impacts Water Industry? Future Food Security Depends on More Efficient Water Use Water Requirements for Food Production, Global, 1960-2050Water Requirements for Food Support food production Production (km3/year) to feed additional 2.7 billion people worldwide between 2010 and 2050 Percent of Population Growth by Year Region, Global, 2010-2050 Source: Hugo Ahlenius, UNEP/GRID-Arendal Note: The data has been ( +4.0% calculated for developing +1.0% phic/water-requirements- countries with minimum for-food-production-1960- set of calories +41.0% 2050), Frost & Sullivan +49.0% +7.0% Source: Global Harvest Initiative, Frost & Sullivan analysis. 6
  7. 7. Sustainable Water & Wastewater SolutionsFood & Beverage Industry is in Demand for Solutions to Cover all Health,Environmental and Economical Aspects Water Integrated Solutions for Carbon Footprint Reduction Non-chemical and Closed Loop Water Treatment Solutions Sludge Management Sustainable Solutions for Water & Biogas Wastewater Generation Solutions for Food & Beverage Health Risk Industry Management Solutions Energy Efficient and Resource Recovery Enabled Wastewater Cost Effective Water Treatment Solutions Reuse and Recycling Solutions 7
  8. 8. Water Cycle in Food & Beverage IndustryGiven the Significant Volume of Water Required for Food & Beverage Production,There is a Vast Need to Implement Advanced Treatment Technologies and Solutions Raw & Industrial Water Boiler Feed Water & •Chemical Treatment Cooling Tower Make-up •Filtration •Ion Exchange •Demineralisation •Softening Water Cycle in •Chemical Treatment Process Water Food & Beverage •Membrane Separation Industry •Reverse Osmosis •Disinfection Water Recycling •Demineralisation •UV disinfeciton •Membrane Separation •Reverse Osmosis Food & Beverage Safe Discharge to Processing Wastewater the Environment •Pre-treatment & Primary Treatment •Secondary Treatment Sludge •Tertiary & Advanced Treatment •Dewatering •Drying Sludge •Flotation •Chemical and Biological Odor •Aerobic Digestion •Separation Removal •Energy Recovery •Anaerobic Digestion 8
  9. 9. Food & Beverage Water and Wastewater Market SizeIncreasing Concern About Water Efficiency in Food and Beverage Industry will DriveDemand for Water and Wastewater Services Between 2011 and 2020 Food and Beverage Water and Wastewater Market Revenue Forecast, Global, 2011 and 2020 $ 2.96 $ 4.80 Billion Billion CAGRMarket Revenue ($ Million) (2011–2020) 5.5% Note: All figures are rounded. The base year is 2011. Source: Frost & Sullivan analysis. 9
  10. 10. Attractiveness of Treatment Technologies Demand is Growing for Treatment Solutions that Can Reduce the Overall Water and Energy Consumption and Increase Reuse Attractiveness of Wastewater Treatment Attractiveness of Water Treatment Technologies in Food & Beverage Industry, Technologies in Food & Beverage Industry, Global, 2011-2020 Global, 2011-2020 Water Market Share Growth Water Treatment Market Share Growth Treatment (2011) Potential Technology (2011) Potential Technology (2011-2020) (2011-2020) Pre-treatment Membrane Separation Primary Disinfection Treatment Secondary Filtration Treatment Demineralization Tertiary & Advanced Treatment Sludge TreatmentKey: High Medium Low Source: Frost & Sullivan analysis. 10
  11. 11. Influence of Mega Trends on W&WWT in the F&B IndustryStrong Focus of Food & Beverage Companies to Increase Water Quality and ResourceEfficiency Can Be Looked Upon as Business Opportunity for Water Companies 2011-2020 Mega Trends of Food & Beverage Industry Impacting Water Water Market Continues re-assessment of healthier solutions in food and beverage Health, Wellness & production, introduction of new categories such as specialty Wellbeing products(ex.vitaminwater) Factories of the Process efficiency improvements, (e.g. Valaqua, a subsidiary of The Future – Smart & Coca Cola Company implementing electrochemically activated hygiene Green device to reduce cleaning time from 6h to 45 min.), zero discharge plants Extension of service reach with convergence of skills (e.g. GE Water New Business partnering with facility management company-Diversey) Water trading to Models better manage supply risks (ex. Prana Sustainable Water) New infrastructure facilities for food processing (e.g. Mega Food Park New Trade Zones Scheme (MFPS) in India to increase share in global food trade from 1.5 to 3.0 percent by the year 2015) Optimization of energy, chemicals and water consumption during Carbon Footprint production (e.g. Danone Group set a goal of reducing its carbon footprint Reduction by 30.0 percent between 2008 and end of 2012) Source: Frost & Sullivan analysis. 11
  12. 12. Case Study Examples of The Coca-Cola Company and Diageo Show How to Successfully Reduce Water Use and Operational Costs by Applying Water Efficiency Solutions The Coca-Cola Company’s Water Use Ratio, Global, 2006-2012 Growing Market Opportunities for Waterof water used per litersWater Use Ratio (liters Companies of product) Increasing investments into water and wastewater Source: The Coca-Cola Company infrastructure, especially in water-stressed regions New Water Ability to invest in solutions Targets set for that increase operational costs The Diageo’s Water Use Ratio, 2011-2015 Global, 2005-2015 even with longer pay-back periodsof water used per litersWater Use Ratio (liters Demand for innovative and advanced technologies to of product) mitigate water supply risk, and reduce wastewater discharge Demand for sustainable Source: solutions to improve product quality and brand perception Source:Frost & Sullivan analysis. 12
  13. 13. Investment Opportunities by Region Asia Pacific is Considered as the Market Hot-spot for Water-related Investments in Food & Beverage Industry Investment Opportunities 2011-2020 Attractiveness of Food and Beverage Water and Wastewater Market by Region, Global, 2011-2020 New-build Refurbishment Advanced Projects Projects Treatment Asia Pacific NorthAmerica Region CAGR (%, 2011-2020) 2011 Latin EuropeAmerica Latin America AsiaPacificMiddle Middle EastEast & & Africa North AmericaAfricaEurope Market Share (%) Note: Size of bubbles represents market size. All figures are Opportunity: High Medium Low rounded. The base year is 2011. Source: Frost & Sullivan analysis. 13
  14. 14. Strategic Recommendations for Market ParticipantsBusiness Innovations, Adjustment to Different Local Conditions and AdvancedTechnological Solutions Bring Advantage in the Highly Competitive Market Strong portfolio of MF/UF membrane technologies, advanced disinfection, biological Innovative solutions with and anaerobic treatment solutions attractive pay-back provides a competitive edge for periods suppliers to the F&B Industry Global presence with strong local footprint to service world’s growing markets Value-add services that increase efficiency, reduce operational costs and lower environmental impact Integrated water management services from turnkey plants supply to full operation and maintenance (O&M) Source: Frost & Sullivan analysis. 14
  15. 15. Examples of Best PracticesThe Market Creates Good Investment Opportunities for Companies of all Sizes – fromInternational Water Corporations to Mid-size Companies Covering Niche Segments Designs, builds and operates on-site treatment systems and facilitating generation of renewable energy from liquid bio-waste from brewing & Clearfleau Limited drinks, dairy processing and food manufacturing as well as other industrial sectors, bringing benefits in cost reduction, space saving, waste limitation and treatment efficiency. Electro Chemical Activation (ECA) technology, which provides a green solution for water disinfection in food & beverage and other industrial Radical Waters applications. The company has installed its patented technology in 21 International Ltd. countries in North America, Latin America, Europe, Africa, Asia and Australia. Source: Frost & Sullivan analysis. Source: 15
  16. 16. The Last WordGiven the Global Trends Shaping Food & Beverage Industry, There are VastOpportunities to Introduce Advanced Water and Wastewater SolutionsYears 2011-2020 is expected to see continuing positive investment trends into food & beverage water and wastewater solutions The investments will focus on new build projects in emerging markets and improvement of water efficiency in developed and water stressed regions Food & beverage industry will remain extremely positive towards adopting innovations and technology upgrades delivering process efficiency and product quality improvements Water footprint is set to be 2020 differentiator for food & beverage products Innovative service mechanisms such as water trading will enable mitigating water supply related risks Energy and resource recovery expected to become industry standard in mid-term Source: Frost & Sullivan analysis. 16
  17. 17. Next StepsDevelop Your Visionary and Innovative Skills Growth Partnership Service Share your growth thought leadership and ideas or join our GIL Global Community Join our GIL Community Newsletter Keep abreast of innovative growth opportunities 17
  18. 18. Your Feedback is Important to Us What would you like to see from Frost & Sullivan?Growth Forecasts?Competitive Structure?Emerging Trends?Strategic Recommendations?Other? Please inform us by “Rating” this presentation. 18
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  20. 20. For Additional InformationChiara Carella Andrew ThorndykeHead of Corporate Communications Sales DirectorEurope, Israel, Africa Environment & Building Technologies+44 (0) 207 343 8314 +44 (0) 186 539 andrew.thorndyke@frost.comFredrick Harry Royan Archana ChauhanGlobal Research Director Research ManagerEnvironment (Water) Markets CEE Operations+44 (0) 207 343 8353 +48 (0) 22 481 62 20