The study indicates more mature markets such as the United States, Western Europe and Japan will remain fairly flat, thanks in part to longer drain intervals.

In the United States, demand for lubricants is expected to grow very modestly through 2019, after healthier growth in the 2009-2014 period, when manufacturing output and general economic conditions recovered from the Great Recession, Freedonia analyst Emily Park told Lube Report. Ongoing economic growth will be offset by the use of higher-value lubricants that are effective under a wide range of conditions and that have longer drain intervals.

Park said demand for lubricants in Western Europe will decline marginally through 2019, continuing a decade-long trend resulting from the use of lubricants that don’t need to be replaced as frequently.

She explained that industries and consumers in countries with highly developed manufacturing sectors and stricter environmental regulations will tend to use higher-quality products, as standards for drain intervals and other performance factors increase and as users seek to minimize handling and disposal costs.

In many developing countries, modernization in the economy and manufacturing sector will support greater use of lubricants with improved quality, she said. However, in countries where environmental regulations are either nonexistent or are poorly enforced, the transition to higher-quality lubricants will proceed at a slower pace as users may lack the incentives to switch to more expensive products with reduced environmental impacts. Additionally, users in these countries are often more sensitive to price, and for many users the potential benefits of the higher-value lubricants do not outweigh the additional costs.

Freedonia expects process oils to be the fastest growing product category going forward, supported by gains in manufacturing output, particularly in Asia-Pacific and other industrializing regions. Park noted this rising demand will primarily stem from healthy growth in manufacturing sectors globally, which use process oils as insulators, carriers, diluents, plasticizers, extenders, mold release agents and defoaming agents.

Demand for hydraulic fluids, metalworking fluids and other lubricants will be positively impacted by improving economic conditions and rising manufacturing output in developing regions, the research firm forecasts, although gains will be more limited than those for process oils.

Biobased hydraulic and metalworking fluids are expected to exhibit healthy gains because they can be used to meet environmental and safety regulations. Many of these developed countries enforce strict regulations on the use and disposal of lubricants, which will drive demand for nonconventional lubricants, such as more environmentally friendly biobased lubricants and lubricants derived from rerefined base oils, Park said in a news release.

Freedonias estimates and forecasts are more optimistic than those of some other consultancies.

For example, consultancy Kline & Co. projected global lubricant demand – including process oil and marine engine oil – to grow about 1.5 percent per year from just over 39 million tons in 2014 to 42 million tons by 2019. Kline believes the continuing global migration to lower-visgrade passenger car motor oil will result in higher penetration of synthetics and semi-synthetics, bringing higher revenues, and conversely in longer oil drain intervals and suppressed overall PCMO growth.

Consultant Geeta S. Agashe, president of Geeta Agashe & Associates LLC, estimated global finished lubricants demand at about 40 million tons in 2014.

For the global forecast, we feel that demand will be stagnant, Agashe told Lube Report. World [gross domestic product] is only forecast to grow by 2 percent to 3 percent, depending on the forecasting agency. While acknowledging that there is more mechanization, industrialization, and growth in vehicle parc taking place, she noted engines today are significantly more efficient, much better quality lubricants are being used – synthetics and synthetic blends – and there is better maintenance and housekeeping.

At the same time, Agashe said, Europe and North America are shrinking their appetite for lubricants. In South America as well, Brazil, the largest lube consumer, is facing significant economic turmoil, and the lubricant industry has been negatively impacted, she said. Sub-Saharan Africa has been impacted by the slowdown of the Nigerian and South African economies. Eastern Europe, of which a large consumer is Russia, and the Ukraine have been very negatively impacted as well.

Agashe noted that while lubricant demand in China and India, as well as Southeast Asia – which have been growth engines in the past for the global lubricants industry – is still growing, it is at a much slower pace than before.

The 467-page study, World Lubricants, costs $6,500 from Freedonia Group. For more information, visit www.freedoniagroup.com.

Editorial Assistant Kiara Candelaria contributed to this article.