ISA and China Instrument & Control Society (CIS) finalise Memorandum of Cooperation

Agreement paves the way for numerous collaborative opportunities

Building on its worldwide presence and mission of global collaboration, the International Society of Automation (ISA) has signed a Memorandum of Cooperation (MOM) with the China Instrument & Control Society (CIS), the leading academic organisation in instrumentation, measurement, control and automation in China.

China Instrument and Control Society

Founded in 1979, the nonprofit China Instrument and Control Society (CIS), formerly China Instrument Society, is the leading academic organization in instrumentation, measurement, control and automation in China.With 42,000 individual members, 2100 group members, 41 technical divisions, 29 local sections, and 10 ad hoc committees, CIS publishes six academic and technical journals on measurement and control and instrumentation, and has hosted MICONEX (Multinational Instrumentation Conference and Exhibition) annually since 1983, providing a forum for innovation as well as science and technology awards.

Located in Beijing, China’s capital, CIS operates as a bridge among the Chinese governmental administrations, industries, scientists, engineers, researchers and manufacturers.

While the two organisations have maintained a mutually beneficial bi-lateral relationship since 1980—with both entities regularly supporting and participating in the events and activities of the other—the MOM formally declares joint intentions to:

• Further the professional interests of automation and control professionals throughout the world.
• Encourage the exchange and dissemination of technical information.
• Promote understanding and cooperation between the members of CIS and ISA.

“The signing of this MOC is the result of multiple conversations in recent years between ISA and CIS,” says Patrick Gouhin, ISA Executive Director and CEO.  “We have established a mutual understanding, based on each organization’s strengths and competencies, that allows us to take the relationship to the next level, benefiting all automation professionals around the world through enhanced information sharing.”

Specifically, the agreement outlines several opportunities for collaboration, including:

• Co-organized automation and control engineering and technical training courses in China.
• Co-sponsored automation and academic conferences in China, other parts of the Asia-Pacific region, the US and throughout the world.
• Reciprocal membership, enabling members of both associations to gain membership into the other at a discount.
• The translation of more ISA publications into Mandarin, and the translation of more CIS publications into English.
• Greater access to ISA automation and control standards in China.

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At a recent meeting in Beijing, China, ISA President-elect Secretary Dr Peggie Koon received a plaque from Wu Youhua, Secretary General of the China Instrumentation and Control Society (CIS). The plaque expresses CIS’ appreciation of ISA’s support and contribution to MICONEX (Multinational Instrumentation Conference and Exhibition), the global conference that CIS hosts each year.

Developing economies’ growth fuels DCS market in Asia.

The major growth in Distributed Control Systems (DCS) revenues continues to come from developing nations. Growth in countries such as India and China is conspicuous because of sluggish growth rates in other regions of the world. While developed nations are just holding their own (at best) in DCS investments, in developing countries, several recent trends are becoming increasingly important for success in the DCS business. These two countries are undergoing rapid growth and industrialization in Asia. At the time of this report, however, China’s growth is slowing. Even with a slowdown in China, Asia remains a leading growth engine for the global DCS marketplace, representing almost 35 percent of the world market.

ARC expects the top five growth industries in Asia to be oil & gas, mining & metals, cement & glass, water & wastewater, and electric power, in that order, with associated increases in DCS revenues. The growth of these industries is expected to be above average. Demand for oil will continue to increase in the long term despite short-term demand shortfalls. Oil exploration and production is taking the industry into increasingly remote and hostile regions, increasing demand for remote operations and subsea production. The power industry is also growing at a healthy rate over the forecast period. Developing economies, such as India and China, continue to invest in new power capacities and world-class power generation facilities. While pent up demand for mining & metals and cement & glass investments caused sizeable increases from 2010 to 2011, the growth is expected to return to a more moderate level over the forecast period.

ARC Foresees the Robust Growth of DCS in Asia
According to ARC Advisory Group’s research, the total distributed control systems market in Asia will exceed $6,300 million in 2016. ARC’s latest study, “Distributed Control Systems for Asia Market Research Study” provides an in-depth analysis of the DCS business in Asia. In addition to market analysis and forecasts, the study also covers the current market nuances, strategic issues, and the future outlook. The report also highlights the factors that influence the DCS market in Asia and its dynamics.

G. Ganapathiraman, Country Manager, ARC Advisory Group, India and co-author of this study says, “The trends that drive the DCS business in Asia vastly differ from those in developed nations. Due to the economic growth in China and India along with the other BRIC countries, investments in infrastructure, oil and gas production, and in refining are rising, leading to increased demand for DCS.”

In 2011, ARC saw a much larger increase in revenue over 2010 than previously anticipated. The order book started improving at the end of 2009 and was quite strong throughout 2010 and the first half of 2011. Because the DCS business is primarily project based with an average nine month lag time from order book to recognized revenue, this strong order book translated into an excellent revenue year for 2011 with Asia’s revenue up over 4.5 percent from 2010.

Level instruments head for China

Increased investments in manufacturing and greater automated production to fuel demand in emerging economies

Multiple advantages will fuel the continued dominance of non-contact level sensors in the global level sensors and transmitters markets. Overall, the market will make a recovery on the back of revived projects that were shelved or postponed during the economic recession.

However, economic turmoil in Europe is causing many multinationals to reconsider their investment plans. In contrast, emerging economies such as China and India are witnessing greater investment and increasingly automated production. The continuous investments in manufacturing facilities are expected to be a strong driver for the instrumentation market in China, in particular.

New analysis from Frost & Sullivan, Global Level Sensors and Transmitters Markets, finds that the global level sensors and transmitters markets earned revenues of $4,048.7 million (€3,186,52m) in 2011 and estimates this to reach $5,319.5 million (€4,188,06m) in 2018.

Positive growth in China

“Field instruments, such as level sensors and transmitters, are set to experience positive growth in China,” notes Frost & Sullivan Senior Industry Analyst V. Sankaranarayanan. “This will be due to rising investments in areas such as petroleum, natural gas, and petrochemicals.”

Non-contact level measurement, in particular, is expected to continue increasing due to the benefits these devices offer.

“Non-contact level measurements essentially ensure a contamination free-environment because there is no contact from the sensor, as found in other forms of level indication such as mechanical, capacitance or conductivity,” says Sankaranarayanan. “The non-contact nature of the level indication is also attractive to industries where the medium being measured is of a corrosive nature as found in the chemical/petrochemical industry.”

Overall, the restoration of health in end-user industries, along with a growing number of projects, will promote market growth. The establishment of new process plants, re-investment in plant renovation and modernisation, capacity expansions, and technology developments will further support the uptake of level sensors and transmitters, globally
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ABB & Zenith join forces for life sciences in China & India

Combined expertise to help customers in China and India meet new industry regulations

ABB and system integrator Zenith Technologies have announced that they will work together to develop and implement automation solutions that will help life science customers in China and India meet new regulatory and product safety requirements.

Headquartered in Cork (IRL), Zenith Technologies is a leading Global Automation and MES Engineering company which focuses exclusively on the life science industry.

ABB will collaborate with Zenith to implement solutions based on ABB’s market leading System 800xA and Freelance automation systems, for the growing life sciences industry in China and India. ABB and Zenith will also deliver solutions that use ABB’s PAT (Process Analytical Technology) and MES (Manufacturing Execution Systems) technology. Increasing governmental regulations, and new requirements that mandate compliance with Food & Drug Administration (FDA) standards and other food safety regulations have made it imperative for life sciences companies in China and India to be able to accurately track products at all points in the manufacturing process to ensure high quality and safety.

“ABB’s field-proven automation solutions, combined with Zenith’s expertise in implementing systems designed to meet these validation requirements, will help our mutual customers in this region improve their overall process and product quality, and meet current and future regulations,” said Tobias Becker, head of ABB Control Technologies. “Our collective knowledge can help our customers better understand how these requirements impact their manufacturing process and what steps are needed to comply with them.

Photoelectric sensors collapse and rebound!

Market for photoelectric sensors faces increasing demand for smart sensors and price pressure

The market for photoelectric sensors experienced a collapse and a dramatic rebound in the last three years.  The market is now back to the development behavior that we have seen in the past.  As the market is strongly dependent on the investment climate, the situation has recently worsened, but ARC still expects a rather positive development for the coming years.

The market for smart sensing in the area of photoelectric sensors refers to all sensors that expand the traditional capabilities of fixed measuring and switching.

“Photoelectric sensors have long been in a position in which there was simply no alternative, but now ultrasonic sensors as well as low-end vision sensors are targeting the same applications.  While photoelectric sensors are still price competitive, they also add value for end users with more functions,” says ARC Analyst Florian Güldner, the principal author of ARC’s “Photoelectric Sensors Worldwide Outlook”

Dependency on Investment Cycles Challenges Suppliers
The demand for sensing is increasing with overall demand for sensors rising faster than for industrial automation in general.  Still, the investment climate overshadows technological effects and trends from the plant floor.  Growth in photoelectric sensors is directly linked to the business cycle.

Automation demand is often supported by the spare parts business, modernization projects, and longer project lead times.  But sensor suppliers cannot count on these dynamics.  In contrast, the relatively high share of sales through distributors emphasizes the effects from investment as distributors empty/fill up their stocks at the beginning of a development.

Flexibility and the willingness to diversify are key characteristics of successful sensor suppliers.  Many are adopting a more solution-oriented business model targeted at measurement, quality control, or safety applications.

Is Smart Sensing a Benefit for the End User?
Smart sensors make the lives of machine builders easier as they reduce the number of suppliers and parts, and help to reduce engineering time.  Smart sensing includes photoelectric sensors, that can self-adjust to the environment, can be configured remotely, can house more than one sensing technology (light barrier, diffuse etc.), can be used for measuring and switching, and that help to detect errors such as a dirty lens or a broken cable.

With all these capabilities, sensors can help to make machines more flexible, shorten changeover times, and minimize planned and unplanned downtime.  Whether or not photoelectric sensors are smart is only important if there is the right connection to the rest of the automation architecture.  Here IO–Link offers a good solution.   However, the acceptance and awareness of IO-Link is still limited.  With technologies like IO-Link, photoelectric sensors are becoming part of the automation hierarchy.

Will Asia Help Suppliers Form Established Economies?
Asia is the fastest growing region in our study.  However, some trends are dampening the impact on sensor suppliers — locally produced machinery is often simple and requires limited, simple, and cheap switches.  Local producers that serve a large portion of the market, especially in China, are forced to focus on high volume, small margin sensors.

Sensor suppliers that focus on direct sales sometimes have difficulty in the Chinese market as the market is primarily served by distributors and thus the companies need to re-think their go to market strategy.  This can also impact their way of doing business because it is solution focused and based on close customer relationships.  These companies benefit from global end user customers that also produce in China, but have also adapted to the new market.

Profiles for the major suppliers for this market are included in this report.  Each profile reviews the company’s business, products, and services as it applies to this market.  Suppliers profiled include Balluff, Banner Engineering, Baumer Electric, Contrinex, Keyence, Leuze, OMRON, Pepperl+Fuchs, Rockwell Automation/Allen Bradley, Schneider Electric, SICK, Sunx, Yamatake.

China leads the way in distribution automation!

Distribution automation, the ‘Darling’ of the Smart Grid to achieve $5 Billion

The Distribution Automation System market has become a top priority for smart grid utilities, across the board and around the world. In recent years, advanced metering infrastructure and demand response were the darlings of the industry, but now the utilities are turning their attention to improving efficiency and control in the distribution segment of the grid that lies between the substation and the meter.

Besides the tangible benefits of improving reliability and efficiency within grid operations, distribution automation system implementations and upgrades have another important attribute — the ability to deliver strong return on investment without requiring extensive consumer engagement or behavior change. In a nutshell, utilities are placing increased emphasis on adding greater intelligence and control capabilities to their distribution infrastructure.

Sovereign investment programs are focused on the expansion of capacity in emerging markets, upgrading of aging transmission and distribution infrastructure, and improvement of reliability and efficiency.

“The Electric Power Distribution Automation System market is being driven by the world’s continued demand for more energy as utilities are faced with the challenges of realizing a good ROI while providing a higher level of service to their customers. These challenges drive the need to conserve energy (specifically the energy lost in the distribution network), defer the building of additional generation facilities, and improve customer service,” according to Steve Clouther , author of ARC’s “Electric Power Distribution Automation Systems Worldwide Outlook”.

Distribution automation system providers
The distribution automation systems market has a diverse group of players and market share leaders, even though the typical range of a distribution network is relatively short; i.e., a distribution network carries electricity from a sub-station to consumers.

The market leaders for worldwide distribution automation are subsidiaries and/or divisions of large international control companies with an expansive global presence. Collectively, the top ten vendors account for 71% of the 2011 worldwide distribution automation systems market.

China is “all In” on the Smart Grid
At the 2011 Smart Grid World Forum in Beijing (October 2011), China’s State Grid Corporation announced plans to invest $250 billion (€205b) in electric power infrastructure upgrades over the next five years, of which $45 billion (€37b) is earmarked for smart grid technologies. According to its three-stage plan, China will invest another $240 billion (€197b) between 2016 and 2020 (including another $45 billion (€37b) toward smart grid technologies) to complete the build-out of a “stronger, smarter” Chinese power grid.

China to be a driving force in distribution automation
According to the International Energy Agency’s (IEA) World Energy Outlook 2011, by 2015 China will overtake the US, and become the leader in total electric power generation capacity. And then, by 2035 China will consume nearly 70% more energy than the United States. With ex-plosive growth such as this, China leads the way in distribution automation.

Asia to be the new magnet for sensor manufacturers!

Sensors to benefit from shift toward better automation

New and expanding applications, coupled with the shift to enhanced automation processes and controls, are restoring growth to the global market for proximity and displacement sensors, which suffered negative growth rates in 2009.

New analysis from Frost & Sullivan, Analysis of the Proximity and Displacement Sensors Markets, finds that the market earned revenues of $2,427.5 million (ca €1950m) in 2011 and estimates this to reach $3,048.1 million (ca €2450m) in 2018. The research covers inductive, photoelectric, capacitive, magnetic, ultrasonic and LVDT sensors.

“The need for better automation is expected to allow for the conversion from older and less sophisticated controls to state-of-the-art automation,” notes Frost & Sullivan Senior Industry Analyst V. Sankaranarayanan. “As a result, the number and range of sensors used in equipment is increasing.”

Due to the rising sophistication in manufacturing processes, end-users are demanding more functionality from proximity sensors. Advanced network technologies (CompoNet and IO-Link) and diagnostic capabilities are some of the technical advancements that are also anticipated to boost market prospects.

Growth in mature markets such as Western Europe and North America is expected to be slow. The potential for further growth is limited, as most industrial processes are already using proximity and displacement sensors. In contrast, Asia is becoming progressively more important due to surging production and automation.

“Production in emerging economies, such as China and India, is becoming increasingly automated,” explains Sankaranarayanan. “Robust economic growth in these regions is expected fuel the demand for proximity and displacement sensors.”

Proximity sensors find application in almost every industry (due to the importance of feedback), underlining the widespread consumer demand for them. In addition to China and India, growth opportunities are also surfacing in other smaller Asian countries that have embarked on a path of economic development.

Keys to success will be emerging network technologies, solutions instead of products, regional growth markets and a successful distribution strategy.

“It is important to offer more than just a sensor; market participants will have to focus on providing complete solutions,” concludes Sankaranarayanan. “Price pressures will continue to pose a challenge, so vendors will need to constantly advance on the technological front.”

Sensors sensing growth?

We have talked about Promising signs in process automation market recently, which had an American flavour,  and we also shared an article which had a British viewpoint on recovery, Manufacturing recovery firmly on track!
Here Tony Ingham of Sensor Technology answers the question Could the sensors sector be a microcosm of the whole national economy? He certainly thinks so. Here he looks at what it will take to run a small technology company in the second decade of the millennium and suggests parallels with the wider world. Yes he is talking about the British experience but surely there are also lessons to be learned in other economies large and small.

Sensing Growth Opportunities
By Tony Ingham

Tony Ingham

You might think it perverse to say something positive about the recent recession, but it had a characteristic that I have rarely seen before – in bad times or good. It helped a lot of people realise what really makes economies tick.

In previous recessions, most peoples’ reaction was to work harder on winning sales, i.e. keep doing what they had been doing and hope for an upturn. This time though, people saw the weaknesses of the whole financial sector and began to analyse how and why economies work.

There has been a realisation that there is a massive difference between fast paper profits and fundamental wealth creation. The engine room of the economy is not the City of London, it is the primary industries, such as manufacturing and agriculture. These create thousands of jobs up and down the country, rather than concentrating so much wealth into the hands of a few lucky individuals that they become divorced from economic reality.

In fact, manufacturing, engineering, science and technology have all fared relatively well over the last couple of years – most of the pain was felt in other sectors. So it is not that surprising that manufacturing is currently our strongest sector.

But the important point is that it must remain so. Manufacturing can be wonderfully profitable if managed correctly over the whole term of its products’ lifecycles. It creates masses of jobs at all levels. It creates yet more jobs in the supporting sectors such as research, development, engineering and design. Its products are easily exportable, so will suck overseas revenues into our coffers. It is also very stable; the need for capital production equipment, highly skilled staff and a sophisticated supporting infrastructure makes it relatively difficult to relocate once it is established.

At the moment, the government is full of praise for manufacturing, but this simply is not enough. This and future governments must support manufacturing and the other technical industries. It needs to develop policies that encourage and promote manufacturing, help exporters, support enterprise and finance R&D; that generate enough trained scientists, engineers, technicians and designers, that improve the social status of those that serve their country via the technology industries. It’s a big ask, but the Chinese and Indians are doing it; the Japanese and Germans did it 50 years ago and the Americans did it 50 years before them.

So where does the sensor sector fit into all this? Well sensors are now widely used across so many areas that they are a bell-weather for the whole economy.

Overall, the sensor sector weathered the downturn well. Early in the recession many car makers and other major industries shut down production for 3 months to reduce stock. But they also took the opportunity to invest in new manufacturing systems, including sensors. Furthermore, sensors are wonderfully exportable, so manufacturers often remained busy servicing clients abroad.  And while the recession was bad, the sectors that suffered the most – finance, banking etc – were not major direct purchasers of sensors.

The UK sensors sector is currently underdeveloped, so offers many opportunities for building strong manufacturing companies that could easily become world leaders and major exporters.

The sector got going on a worldwide basis in the late-1970s or early 1980s, when traditional craft-based instrument making was giving way to sophisticated manufacture of high tech sensors. Unfortunately, at this time manufacturing was definitely not in favour in the UK. Instead, the government of the day was happily clearing away what it saw as union-infested, decrepit,  smokestack industries, so that new sunrise industries could take root (in a free market, without government support). So while the UK got call centres and pension advisors, sensor manufacturing flourished in countries where capital enterprise was supported, where labour forces did not have a black name, where a growing manufacturing sector provided a domestic market.

I must at this point say that there were exceptions, notably our own company Sensor Technology which researches, designs, develops, and manufactures sensors in the centre of England. It is a self-evident truth that what we have achieved could be replicated by other sensor manufacturers, especially if general UK manufacturing grows.

There is a virtuous circle to be developed. The more sensors that are used, the greater the manufacturing volumes; this lowers unit prices and also allows investment in automated production and improved quality systems, which encourages yet more usage.

The driving forces for the development of sensor technology include miniaturisation, robust solid state controllers replacing delicate mechanisms, wireless solutions, increasing intelligence, improved connectivity and ‘open’ communications. New drivers will also emerge, and new markets will open up.

Since Sensor Technology first set out its stall, cars have gone from having a handful of sensors to literally thousands, factories have become automated, soaking up sensors, entirely new markets have opened up such as home electronics, mobile devices, medical equipment, CCTV and surveillance, etc. Future growth will be even greater, and it is there for the taking – hopefully by a strong UK sensor manufacturing industry!

Promising signs in process automation market

Promising signs point toward a continuing recovery for process automation market during this year and beyond

Promising signs continue to point toward a sustained process automation market recovery to continue through 2011. During 2010, the automation market was at the point where suppliers serving the installed base with MRO activities fared better than those relying heavily on project business. Suppliers ate through a huge chunk of their project backlog and finished product inventory while new projects were postponed or canceled during the recession. Also, shipments for many new project orders received during 2010 were delayed until 2011.

ARC expects the tepid growth seen during 2010 to accelerate in 2011, but remains skeptical about the process automation market reaching pre-recession growth levels. Historically, the process automation market has been characterized by slow yet steady growth, and we expect the market will return to this pattern with an overall CAGR of roughly 6 percent over the five-year period of 2009-2014. “Suppliers with quick access to raw materials and components and an efficient supply chain to enable quick ramp-up of production and inventory will be in the best position to partici-pate in the increase in demand,” according to Senior Analyst David Clayton, the principle author of ARC’s “Automation Expenditures for Process Industries Worldwide Outlook” .

Global Manufacturing PMIs Show Expansion
Purchasing managers’ indexes (PMIs) provide a good barometer of overall health in the manufacturing and automation markets. PMIs typically in-clude data, such as production level, new orders, supplier deliveries, inventories, and employment level. A PMI reading below 50 indicates a general contraction in the manufacturing economy being measured while any reading over 50 indicates expansion. The J.P. Morgan global manufacturing PMI edged up to 57.8 from 57.1 in January, marking the second-fastest reading ever in the global gauge, which is based on other surveys covering over 7,500 purchasing managers in nearly 30 countries. Output and new order components accelerated, and the input price gauge rose to 76.7 from 73.3 in January. The US ISM represents 28.6 percent of the gauge, followed by Japan at 12.3 percent, China at 7.4 percent, Germany at 5 per-cent and the UK at 4.2 percent.

Plan for Increasing Demand
Most automation suppliers followed a conservative strategy of cutting cost and inventories to match declining demand during the lengthy economic slowdown. Suppliers accustomed to taking risks should put themselves in a position to take advantage of growth opportunities that are taking root in developing countries. Sluggish demand has hurt the bottom lines of sub-suppliers, making them more open to negotiate on both prices and terms.

As the economy recovers, automation suppliers must make plans to make the necessary changes and emerge as stronger organizations that are able to meet renewed demand. However, this confidence will only come if there is a clear understanding in their organizations about the long-term trends that drive demand for automation and develop strategies to satisfy those demands.

Some of these long-term trends include:
• Emerging markets will need to expand their power grids for years to come
• Mature economies in North America and Europe will have to renew their aging infrastructures
• Energy efficiency initiatives will be implemented across all areas of industrial organizations
• Industry must efficiently comply with regulatory agencies without losing productivity
• Most countries must tackle climate change before the emissions from the growing use of fossil fuels stifles progress, an issue that is plaguing China
• The intense competition of global markets will continue to drive industry to become more efficient
• Many of the easy gains have already been realised by industry, so now they will look for new ways to raise productivity
• Organizations will require even more information to make optimised business decisions
• Sustainability will be part of all discussions and implementations
• EH&S requirements will drive new automation investments beyond productivity improvements
• Discovery and production of new energy sources, such as shale gas, geothermal, and clean coal

While one can list many more long-term trends, the message is that new strategies must be formed based on these emerging trends, which will im-pact automation suppliers in a variety of ways, from new product development programs, to establishing added service capabilities, to making regional investments. Satisfying these long-term trends will require producing automation that provides manufacturers with improved productivity, energy efficiencies, optimised processes, real-time data and asset management programs, along with personnel that have a profound under-standing of these industrial processes.

Suppliers should limit their exposure and begin identifying preferred sub-suppliers and define a product mix that will be most in demand. Suppliers should plan appropriate inventory based on production and sourcing lead times and demand forecast. The most important step is to carefully analyse end user purchasing history and projected demand. When combined with supply chain and logistics efficiency, it could mean the difference between success and failure. Miscalculations in these areas will hurt profitability; getting it right will allow suppliers to leapfrog the competition.

• See also “Manufacturing recovery firmly on track says CBI“ for a British point-of-view in DPA on the Net!

Moderate growth for field process instruments

The worldwide market for Process  Field Instruments will grow at an average annual rate of about 5  percent from 2010 through 2015 according to the most recent forecast update of Process Instrumentation and Automation markets conducted by  the Global Foresight Group™.

Process field instruments include all key pressure, temperature, flow  and level instruments.

In 2010, North America accounted for  approximately 30 percent of the total market demand for process field instruments, while Europe (EU) was 23 percent.  BRIC countries (Brazil, Russia, India and China) made up another 19 percent of the
demand.  All other countries provided the remainder.

BRIC countries will provide the highest growth rates for these  instruments in the forecast period.  This will continue the decline  of the North American and European market shares.