North America Industrial Gaskets Market

The oil & gas industry is a major consumer of industrial gaskets in North America. The region's continued demand for energy is a significant driver of market growth. In this context, industrial gaskets play a vital role in maintaining the integrity of pipelines, refineries, processing units, and related equipment by avoiding leakages, ensuring safe operation, and minimizing unplanned outages. Gaskets find broad applications in refining and midstream operations, including heat exchangers, pumps, valves, and other high-stress applications, where they are called on to withstand extreme temperatures, high pressures, and aggressive chemicals.

The industrial gaskets market is hampered by fluctuating prices of raw materials such as rubber, metal, and fluoropolymers, which keep fluctuating based on demand and supply, geopolitical occurrences, and natural disasters. For example, rubber prices rose by 20% in 2020 because of a shortage of natural rubber in Southeast Asia (Source: International Rubber Study Group). Additionally, fluctuating raw-material prices affect companies' profit margins, as they cannot produce goods cheaply. According to a report by the National Institute of Standards and Technology (NIST), raw materials account for up to 70% of the cost of industrial gaskets. Additionally, fluctuating prices of these raw materials can impact inventory management, as companies may overstock to ensure a consistent supply. These price fluctuations affect the industrial gaskets market by discouraging companies from investing in R&D and product diversification, making it difficult for them to compete with low-cost manufacturers. Furthermore, fluctuating prices can also influence customer demand, leading to order cancellations since customers may be uncertain about when they will need the gaskets.

The increasing focus on sustainability in emerging markets is creating immense opportunities for the industrial gaskets market, especially in the research and development of environmentally sustainable gaskets. With government authorities across the world paying closer attention to make their environmental policies more rigorous, industries are under pressure to adopt sealing solutions that not only deliver superior performance but are environmentally non-harmful. As a result, research and development in gasket production is increasing, with companies increasingly shifting toward developing biodegradable, reusable, and non-emitting substitutes. For example, with mounting demand for PTFE and other advanced polymers with high durability and environmental sustainability, companies can benefit from reduced emissions and leaks in critical industries. Moreover, companies operating in the oil & gas, petrochemical, and power generation sectors, under constant pressure from end-use industries to increase sustainability and reduce their environmental impact, will increasingly support this sustainability revolution. As companies increasingly invest in R&D to produce high-performance and environmentally sound gaskets, new markets are being developed in this area, for example, for renewable energy plants, water treatment plants, and sustainable manufacturing industries, bringing forth immense opportunities for companies focusing on sustainability in this industry.

The industrial gaskets industry is challenged by cheap producers, especially those based in developing countries such as China and India. Such producers have an advantage in terms of lower labor costs, a lax regulatory framework, and access to cheap resources, which makes it possible for them to produce cheap gasket products. Such cheap products make it a challenge for established companies to compete with them based on pricing. Furthermore, cheap producers do not have to obey all standards and safety requirements, which leads to an influx of sub-standard products in this industry. Such products pose a threat not only to consumers but to this industry as well because they may have a negative impact on the image of this industry. As such, it is important for high-end companies in this industry to distinguish themselves in terms of product quality, reliability, and conformity with international standards. They are forced to invest in research and additional services in order to keep up with their competitive positions in this industry.