LATIN AMERICA INDUSTRIAL EXPLOSIVES MARKET ANALYSIS

An explosive refers to a reactive substance that is comprised of a vast amount of potential energy that can produce a massive explosion if released suddenly. It is usually accompanied by light, sound, and pressure. The process of initiation of explosives is termed as detonation. One unit of explosives when initiated can expand up to 1,000 units within several milliseconds creating high pressure in the blast hole and gaining temperatures ranging from 1,500°C to 4,000°C and an approximate velocity of 2,500–8,000 meters/second. Explosives are categorized on the basis of the speed of their detonation. Moreover, another parameter that classifies them is the intensity of the detonator used in imitation of the explosive. Industrial explosive is used in various application areas such as mining, construction, and more.

The Latin America industrial explosives market was estimated to account for US$ 1,172.7 Million in terms of value in 2021 and is predicted to grow at a CAGR of 7.9% during the forecast period (2022 to 2030).

Recent Developments:

• In Feb 2020, Orica Limited, a provider of commercial explosives and blasting systems announced the acquisition of EXSA, a manufacturer and distributor of industrial explosives. Through this acquisition, Exsa's cutting-edge Initiating Systems (IS) manufacturing plant has been incorporated into Orica's global manufacturing infrastructure. Utilizing latent capacity which will enable Orica to considerably boost production, transforming IS manufacturing capability

Market Driver:                                                      

Growing demand for lime in the production of pigment and as filler

Increasing demand for metals, non-metals, and stones in Latin America has increased mining activities thereby boosting the overall demand for industrial explosives. Growing inclination of foreign investors in the Latin America mining industry has led to a boost in the demand for explosives such as blasting agents and high explosives in the region. According to Coherent Market Insights’ analysis, Investments in the mining sector in Latin America had risen by over 50% from 2010 to 2014. According to the same source, Total investment in the mining sector in Mexico reached US$ 14.6 Mn collectively in both 2012 and 2013. Hence, these factors are expected to drive growth of the Latin America industrial explosives market in the near future.

Increasing demand for metals, non-metals, and stones in Latin America has increased mining activities thereby boosting the overall demand for industrial explosives. Growing inclination of foreign investors in the Latin America mining industry has led to a boost in the demand for explosives such as blasting agents and high explosives in the region. According to Coherent Market Insights’ analysis, Investments in the mining sector in Latin America had risen by over 50% from 2010 to 2014. According to the same source, Total investment in the mining sector in Mexico reached US$ 14.6 Mn collectively in both 2012 and 2013. Hence, these factors are expected to drive growth of the Latin American industrial explosives market in the near future.

Restraint:

• Rising raw material prices are expected to restrain growth of the Latin America industrial explosives market during the forecast period.
• Stringent government regulations regarding the use of explosives are expected to hinder the Latin America industrial explosives market growth over the forecast period.

Latin America industrial explosives Market - Impact of Coronavirus (Covid-19) Pandemic:

Due to the outbreak of the Covid-19 pandemic, almost each and every industry in Latin America got significantly affected such as Mining, Manufacturing, and Others, and hence the demand for Industrial explosives also decreased.

Furthermore, Due to the lockdown, raw materials were not available easily so the production of industrial explosives was stopped so mining activities significantly decrease which directly impacted on industrial explosives market.

Market Trends

1. Rising use of explosives owing to increasing depth of underground mines

 Major companies involved in the market are focused on increasing the depth of underground mines, in order to extract more amount of minerals and are thus deploying a large amounts of explosives specially ANFO and bulk explosives. For instance, in April 2014, ‘KGHM Polska Mied?’ started a new project called ‘Deep Glogow’ for the extraction of copper and silver. The depth of the mine is 1,200 meters and is expected to yield minerals for a span of 40 years.

2. Growing utilization of blasting agents for tunneling rather than mechanical drills

 Majority of companies are more inclined towards the use of explosives for tunneling of roads and railway tracks instead of mechanical drilling. For instance, Orica, an Australian explosives manufacturer, offers over 15 denominations of explosives (ANFO, emulsions, etc.) to be used in tunneling projects

Figure 1. Latin America Industrial Explosives Market, Revenue Share (%), By Country, 2021

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Market Opportunity:

• Rise on construction activities in Latin America can present major growth opportunities.
• Higher demand for blasting agents can provide lucrative business opportunities

Chile held dominant position in the Latin America industrial explosives market in 2021, accounting for 28.9% share in terms of value, followed by Peru, Colombia, Brazil, and Mexico respectively

Figure 2: Latin America Industrial Explosives Market (US$ Mn) Analysis and Forecast, 2022 - 2030

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Latin America industrial explosives market was valued at US$ 1,172.7Mn in 2021 and is expected to reach US$ 2,281.6 Million by 2030, growing at a CAGR of 7.9% between 2022 and 2030.         

Major players operating in the Latin America industrial explosives market are MAXAM, AEL Mining Services Ltd., EXSA SA, Enaex, Austin International, Orica Limited, Keltec Energies, Economic Explosives, IBP Co., Noble Explochem, Accurate Energetic Systems, LLC., and Detotec North America Inc.