Report Overview
7th Edition
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This study examines the global market for finished lubricants. Products covered include:
engine oils
transmission and hydraulic fluids
process oils
metalworking fluids
general industrial oils
gear oils
greases
Demand for finished lubricants is discussed in terms of intended markets, including:
motor vehicles
light-duty vehicles
medium- and heavy-duty vehicles
motorcycles
manufacturing
off-highway equipment
construction machinery (e.g., excavators, cranes, pavers)
mining machinery (e.g., surface mining equipment, mining drills and breakers)
agricultural equipment (e.g., farm tractors, harvesting machinery, sprayers)
transportation equipment
marine (e.g., passenger and cargo ships, yachts and other recreational boating, military ships and submarines)
railroad
aerospace (military, commercial, and personal aircraft; spacecraft; communications satellites)
other markets (e.g., oil and gas exploration and production, electric power generation)
Demand is also discussed in terms of lubricant formulation:
conventional petroleum
synthetic
re-refined
biobased
World base oil trends, as well as finished lubricant production and trade, are also discussed. Purchasers of Freedonia Group studies covering the US market for lubricants should note that the product segments differ; in this study, tractor transmission fluids (also known as universal tractor fluids) are included with hydraulic fluids, while all other transmission fluids are included in the other products category. It should also be noted that world base oil demand is discussed in terms of the location of finished lubricant end use and not of lubricant production or blending. Additionally, API Group III base oils and lubricants from which they are formulated are classified in this study as synthetic products. This differs from prior versions.
Historical data for 2009, 2014, and 2019, and forecasts for 2024 and 2029 are provided for lubricant demand by product type and market for six regions and 24 individual countries. In this study, the term “demand” is used synonymously with “sales” and “consumption”. Tabular details may not add to totals due to independent rounding, and ratios may be rounded for clarity.
Global Manufacturing Trends Impacting Lubricant Use
3D Printing
3D printing – a young technology that has historically been used for small-scale modeling – has rapidly evolved in recent years to become a viable tool in many manufacturing applications.
The technology is currently more widespread in developed areas, as printer development and manufacturing is concentrated in those areas and it requires a high initial expense.
3D printing is a topic of great importance to the industrial lubricants market since 3D printers are able to produce metal products without requiring metalworking fluid, a fact that could significantly impact fluid demand.
3D technology is most relevant to the lubricant industry in manufacturing transportation equipment. Currently, many end use aerospace parts are fabricated using 3D printers. While the aerospace manufacturing segment accounts for a minority of total transportation equipment manufacturing, the printers are expected to see wider use in the motor vehicle production industry, which is one of the most significant users of industrial lubricants.
Aside from transportation equipment manufacturing, 3D printers are most widely used in markets or applications that do not require lubricants, such as educational, medical, and dental uses. However, applications such as molds and tooling, construction, and oil and gas production are expected to undergo fast growth through 2029 and hold the potential to impact lubricant use in those markets over the long term.
In 2024, 3D printing is expected to have a small impact on global industrial lubricant demand, although in the long term it will restrict growth for metalworking fluid demand, particularly in North America, Western Europe, Japan, and South Korea.
Motor Vehicle Ownership & Usage Trends
The most important determining factor for global automotive lubricant demand is motor vehicle ownership. Large vehicle parcs necessitate high levels of automotive lubricant aftermarket demand, though other factors such as how frequently the vehicles are driven, how technologically advanced the vehicle parc is, and the ratio of small passenger vehicles versus sport utility vehicles (SUVs) and trucks and will also impact lubricant consumption.
There are several key factors that determine a country’s level of vehicle adoption and usage, including:
disposable income levels within a country, particularly for the middle class
size of geographic area that promotes or discourages motor vehicle travel
quality of road networks
Historically, vehicle ownership levels in developed countries have been higher than in developing countries due to several major factors. Developed nations tend to have:
large, affluent middle classes
large, well maintained road networks that facilitate both passenger and commercial vehicle travel
plentiful suburban areas that increase average distance traveled per vehicle
Prime examples include Australia, Canada, and the United States. All three countries have high levels of automotive lubricant demand relative to their populations, which results from their above average vehicle ownership and usage.
A developed nation does not need to have all three of the above characteristics to have a large motor vehicle parc. For example, Japan has significantly less roadway than the US, Canada, or Australia, yet vehicle per capita ownership levels in Japan are similar to those in Europe due to Japan’s wealth and well-established suburban areas.
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Global lubricant demand is forecast to rise an average of less than 1.0% per year to 44.4 million metric tons. The major driving factors will be:
increased manufacturing activity, particularly in developing countries
a heightened level of global trade
expanding vehicle ownership in developing countries
increasingly strict environmental and health regulations in developed regions
However, lengthening fluid drain intervals globally will act to moderate growth.
Lubricant demand was also negatively affected by the COVID-19 pandemic in 2020. The construction, manufacturing, and motor vehicle markets in particular saw significant declines in lubricant demand, causing average growth for these markets to slow as they recover the losses incurred in 2020.
Increasing Spending Power of an Expanding Middle Class to Drive Increases
Lubricant demand will be boosted by an expanding middle class – and its increasing spending power – in developing areas such as India and Southeast Asia:
Rising ownership of motorcycles will benefit demand for lubricants used in these vehicles.
As consumers become more affluent, manufacturing of such items as food, beverages, and consumer goods will increase to meet growing demand for these goods, boosting use of lubricants used with production machinery and equipment.
Economic growth in developing countries will result in increased construction activity and mining output, which will boost demand for off-highway automotive lubricants.
Environmental Concerns & Regulations to Limit Automotive Lubricant Demand
Although automotive lubricants demand is expected to expand through 2024, efforts by countries’ including China, India, and those in the EU, to limit emissions and increase fuel efficiency will impact demand growth:
Motor vehicle manufacturers continue to shift production toward vehicles with smaller engines – which require less engine oil – to meet tighter fuel efficiency requirements.
More markets are adopting low viscosity, high performance synthetic-based fluids that improve fuel efficiency and allow for extended drain intervals.
Although a number of countries have encouraged the use of electric vehicles as an effective means of reducing air pollution, their impact on automotive lubricant demand will remain somewhat limited through 2024 due to the size of the existing vehicle parc and the challenges of expanding electric vehicles’ presence in the market without significant subsidies. However, it is expected that this situation will change over the long term, as electric vehicles become a bigger part of the market.