Cleveland-based market analysts The Freedonia Group just released a new study, “World Industrial Silica Sand” that includes projections for the North American Frac Sand market.
The study notes that “Demand for silica sand in the hydraulic fracturing market is expected to increase 8.9 percent annually through 2016 to 34.4 million metric tons, valued at $2.2 billion. This will be the fastest pace of increase of any major market segment and is indicative of projected ongoing gains in the U.S., as well as increasing global interest in hydraulic fracturing techniques.”
In volume terms, the U.S. will continue to lead the world market, representing over 75 percent of all hydraulic fracturing sand consumption in 2016, the study predicts. Canada will be the second largest consumer of frac sand, accounting for eight percent of the market in that year. There are several other significant markets for hydraulic fracturing, notably Russia and China, but these countries currently rely more heavily on ceramic products, thus limiting silica sand usage.
The study also notes that “prices of silica sand in the hydraulic fracturing segment will exhibit healthy gains, driving up silica sand demand in value terms.” While ceramic proppants are better able to meet the heightened performance requirements for proppants in deeper wells and in fracturing operations with greater pressure levels, raw frac sand will continue to dominate demand in volume terms, largely because raw sand proppants can be utilized at the fraction of the cost of ceramic proppants.