Data from the semiconductor industry group SEMI show that demand for wafer processing equipment grew an astonishing 37.5% in 2017. Total semiconductor equipment sales are forecast to increase 7.4% in 2018, with South Korea becoming the largest individual market for the first time. Although lab instrumentation is only a small portion of the semiconductor equipment industry, the overall semiconductor and electronics industry has the strongest growth prospects for 2018, with demand for instruments growing 6.5%. This should provide a boon to the markets for electron microscopes and X-Ray Fluorescence spectrometers (XRF), as well as other surface science, atomic spectroscopy and materials characterization instruments relevant to the industry.

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Broadly speaking, life science–oriented markets in both research and applied sectors will do well in 2018. Strong performances are expected for demand from the biotechnology and food industries, hospitals and CROs (strongly associated with life science customers). With the exception of semiconductors, other industrial and environmental end-markets will be found in the middle of the pack, growing mid-single digits.

Chemicals

According to a December 2017 forecast by the American Chemistry Council (ACC), global chemical output will accelerate in 2018, growing 3.2% compared to 2.7% last year. Africa and the Middle East, and Asia Pacific will lead this growth with chemical volumes up 4.2% and 4.1%, respectively. However, for Asia Pacific, this is slower growth compared to the 4.6% increase last year.

North America will experience the largest percentage point jump in production volumes, rising from flat growth last year to 3.4% growth in 2018. As a result, US chemical companies are expected to increase capital spending, with expenditures rising 6.3% versus 6.0% last year. Latin American volumes should recover from a decline in 2017 to grow 2.5%. As for Europe, Cefic (the European Chemical Industry Council) expects chemical output to fall to 2% growth this year after estimated growth of 3% in 2017.

Biopharmaceutical

Biopharmaceutical R&D spending is forecast to rise 2.5% in 2018 to $161.4 billion, according to EvaluatePharma’s June 2017 report. This is a welcome increase over 2017’s 0.5% growth. Total industry financing, including IPOs, was $51 billion last year, as reported by BioWorld.

In a January report, Silicon Valley Bank estimated that venture capital investments in US pharmaceutical and biotech companies rose 28.0% in 2017 to $10.5 billion, with a higher average size per deal. Oncology was the largest investment sector at $3.4 billion, with early-stage investments dominating. Separately, the report predicted 2017 healthcare venture capital financing to have risen 26.4% to $9.1 billion. IPOs also surged, though M&A was more restrained. Baker McKenzie reported in January that pharmaceutical M&A worldwide rose 2.3% last year to $225 billion. Such activity is expected to pick up this year, reaching an estimated $297 million.

Energy

The International Energy Agency forecast in December 2017 that worldwide demand for oil will increase 1.3% in 2018 to 99.1 million barrels per day (mb/d), a decline from 1.6% growth last year. Global refinery crude throughput is estimated to have increased 1.0% last year to 80.6 mb/d. Wood McKenzie forecast in December 2017 that capital spending by upstream oil companies will increase slightly in 2018 to $400 billion. However, capital spending on liquid natural gas projects will fall to $16 billion due to the completion of two major projects. Based on a December 2017 survey of energy companies, Evercore ISI found that global capital spending by energy exploration and production companies in expected to rise 7%, which would be the first increase in four years, led by the US with a 15% increase to more than $100 billion.