Global Industrial Lubricants by Product, Market and Formulation

Report Overview

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Increasing Need for Manufacturing Will Drive Lubricant Demand

Rising household incomes, especially in developing countries, will boost global demand for manufactured products, increasing global levels of trade and electricity generation, all of which will spur demand for industrial lubricants.

Key Findings in the Global Industrial Lubricants Study:

Growth Faster in the Developing World

Demand for industrial lubricants in developing countries is anticipated to grow faster through 2021 than in the developed world. Higher levels of new capital formation, particularly in India and China, the two markets expected to undergo the most growth, and faster growing levels of trade will increase lubricant demand in manufacturing and transportation equipment applications, respectively.

Engine Oils to Register Fastest Sales Gains

Demand for industrial engine oils was responsible for 19% of industrial lubricant demand in 2016, is expected to grow at a CAGR of 2.3% through 2021, the fastest rate of any product. Increased maritime trade, especially in developing countries, will drive gains in demand. Asia/Pacific, already the leader in demand for industrial engine oils, will undergo the most volumetric growth, while Africa/Mideast and Central and South America are expected to witness above average gains.

Nonconventional Formulations to Gain Market Share

While conventional lubricants has historically held the vast majority of formulation market share, growth in demand will be outpaced by synthetic, bio-based, and re-refined industrial lubricants. Driven by modernizing factory equipment, synthetics will grow by one million metric tons through 2021, the largest volumetric gains of any formulation. Increased environmental regulations will boost demand for re-refined industrial lubricants, which are expected to grow at a faster CAGR than any other formulation.

Study Coverage

This industry study presents historical demand data (2006, 2011, and 2016) and forecasts for 2021 by product class (process oils, engine oils, hydraulic fluids, metalworking fluids, gear oils, greases, and general industrial oils), market (manufacturing, transportation equipment), and formulation (conventional, synthetic, bio-based/re-refined). The study also evaluates company market share and analyzes leading suppliers including BP, Chevron, Exxon Mobil, Shell, and Total.

This study examines the global market for finished industrial lubricants by product, market, formulation, and geographic region in volume terms at the demand level (i.e., purchases made with the intent of using the product for lubrication purposes, and not as an ingredient to be used for further formulation). Historical data for 2006, 2011, and 2016 and forecasts for 2021 are presented in thousand metric tons.

The products covered in this study are:

• process oils
• engine oils
• hydraulic fluids
• metalworking fluids
• general industrial oils
• gear oils
• greases

This study only includes industrial applications of the above products. That is, engine oils, hydraulic fluids, gear oils, and greases that are used in automotive applications (motor vehicles; off-highway equipment; outdoor power equipment including lawn and garden equipment, snow blowers, and leaf blowers; and recreational boats) are not included in this study.

Industrial lubricant demand is segmented into the following markets:

• manufacturing
• transportation equipment
• other industrial markets (e.g., power generation, oil and gas production, mining, agriculture, miscellaneous commercial and industrial)

The manufacturing market includes all lubricants consumed during the production process of a finished good. Thus, the lubricants used by machinery in the production or assembly of any item in a factory are counted in this category. This includes a wide array of categories, from food and beverages to electronics. It is important to note that all factory fill lubricants in motor vehicles and transportation equipment (i.e., the lubricants installed in the vehicle for the consumer to use) are excluded from this category and this study.

Transportation equipment includes all lubricants consumed by the marine, railroad, and aerospace industries. This includes both factory fill as well as any on-board applications. For example, lubricants consumed in the operation of a crane on a ship is counted in this category. However, it is important to note that recreational boats are covered under Freedonia Group study #3583 Global Automotive Lubricants.

The remaining markets, which are presented in this study under the header “other industrial markets”, include power generation, oil and gas production, mining, agriculture, and miscellaneous commercial and residential applications. This includes applications such as hobbying, home and office printers, sliding windows and doors, paper shredders, and many others.

For mining, this study does not include any transportation vehicles used in operation (e.g., dump trucks). It includes all other pieces of mining equipment – including shovels, long-wall hydraulic equipment, electric motors, gear boxes, pulley shaft bearings, and conveyors.

For agriculture, this study does not include lubricants consumed by tractors, cultivators, or harvesters, but does cover all other applications. Most of the demand is in the form of agricultural spray oils to control dust and act as pesticides, but it does include pieces of stationary equipment such as grain dryers, milking machines, and conveyor belts.

Demand is also segmented by formulation in this study. The four classifications of formulations are:

• conventional
• synthetic
• re-refined
• bio-based

Conventional lubricants include all finished industrial lubricants made from API Group I and Group II base stocks. Synthetics include all products made from API Group III, Group IV (PAOs), and Group V base stocks. They also include lubricants whose base stocks were a mixture of Group III, Group IV, or Group V with a conventional base stock (commonly referred to as semi-synthetic or synthetic blend). Re-refined industrial lubricants include all products made from base oil that has been re-refined, regardless of whether the oil was originally classified as synthetic or conventional. Bio-based lubricants are all lubricants made from biological base stocks, such as vegetable oils.