The commercial gas market in Croatia reached revenues of $105 million in 2014. This was up from $50 million in 2004, indicating an 8.1% p.a. growth rate for the decade.
In terms of supply mode, the merchant market accounts for around 90% of revenues. We calculate that just over half of revenues are generated through the sale of packaged gases. Bulk supply accounts for around 40%, revenues from onsite business produced a marginal 1-2% of revenues. We do expect these shares to alter in the coming years – if the forecasted economic recovery does happen and customers increase their demand. This will open up the opportunity for receivers of bulk gases to be converted to small onsite supply schemes. There is a small section of the industrial gases business that operates on a captive basis, this is linked to hydrogen production at refineries.
Over half of revenues are generated through sales to the manufacturing and metallurgy sectors. A further 15% is produced through sales to chemical clients and 9% through refining clients.
The rest of the market is rather fragmented, with the healthcare, electronics and food sectors producing shares between 2.5% and 7.5%
Going forward, we expect the commercial industrial gases business in Croatia to reach between $130 million and $160 million by 2020. This would indicate average annual growth of between 3% p.a. and 5.9% p.a. within the 2015 to 2020 timeframe.
We expect that the metallurgical and manufacturing sector will continue to be the largest sectors for the foreseeable future, with both set to grow by around 3% p.a.
We also expect the refining sector to grow by around 3%. This should be supported by the upcoming restart of INA’s refinery in Sisak, which was closed in early 2015 due to lack of crude stocks.
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