Asia was the biggest regional market in 2013, with 39.9 percent of global revenue, followed by North America with 28.8 percent, Frost & Sullivan Chemicals, Materials and Food Research Associate Srinivas Venkatesan told Lube Report.

As industrial production increases in China, India, Russia, Turkey, Brazil and Southeast Asian countries, regulations on waste water treatment and disposal are compelling end users to optimize the use of mineral oil-based metalworking fluids, Frost & Sullivan said in a news release. This is expected to increase the adoption of semi-synthetic and synthetic metalworking fluids that offer good balance between cost and performance. In turn, the metalworking additives segment is expected to grow rapidly, the research firm concludes, as synthetic-based metalworking fluids require a stronger additive package.

Regulations on wastewater treatment will also be a major driver in Europe and North America. Boosting metalworking fluids sales volumes will be the burgeoning Asian automotive industry and niche applications such as medical machining. The analyst explained that the medical machining markets customers demand high-performance fluids that are also easy to clean and must be extremely resistant to bacterial and fungal outbreak. Medical machining is of utmost interest to metalworking fluids formulators.

Venkatesan noted that the replacement of metals with plastics and composites in some applications will to an extent quench the demand for metalworking fluids. For example, the automotive and aerospace industries are using plastics and composites more to achieve lighter weights.

The total percentage of plastics and composites in automotive and aerospace industries is on the rise, restraining the growth of the metalworking fluids market, Venkatesan said. For instance, the composite percentage of airframe weight in the Airbus A340 was 10 percent and in the Boeing 777 was 12 percent. In new models such as the Airbus A350XWB, the composite percentage of air frame weight is 53 percent, while in the Boeing 787 it is approximately 50 percent.

Similarly, plastics make up 50 percent of the volume of new cars but only 10 percent of the weight, making cars lighter and more fuel efficient, and resulting in lower carbon dioxide emissions. Hence, car manufacturers are on the lookout for ways to replace metals and alloys with plastics and composites. This impedes the growth of the metalworking fluids market.

Another factor crimping growth in metalworking fluids demand is the development of technologies such as minimum quantity lubrication, high pressure machining and near-net-shape casting, which could replace conventional metalworking processes.

Venkatesan explained that near-net-shape manufacturing is a process in which the final shape is obtained through the initial production, thereby eliminating the need for metalworking and surface finishing. Near-net-shape casting techniques include investment casting, spray forming, laser forming and vacuum forming.

Offering differentiated products and innovative customer support mechanisms will help manufacturers stay afloat in the highly competitive market, Venkatesan opined. Extending support services such as troubleshooting and periodic reports on health of metalworking fluids will enhance consumer loyalty.

As established manufacturers look to broaden their portfolios, the research firm suggests mergers with and acquisitions of regional vendors possessing specialized capabilities and a strong customer base will gain pace in the global metalworking fluids market.