A cartel of South Korean industrial lubricant suppliers colluded to raise prices and rig bids during periods of market turmoil, including the COVID-19 pandemic and the Russia-Ukraine war, according to the country’s antitrust regulator. The companies could face fines of up to KRW 404 billion (U.S.$262 million).
The case strikes at a key sector in one of Asia’s largest manufacturing economies. South Korea’s lubricants market was valued at about $2.1 billion in 2024 and is expected to grow steadily through the decade, according to Mordor Intelligence. Demand is driven by the automotive, shipbuilding, steel, machinery and electronics industries, where industrial lubricants and metalworking fluids are essential to production.
The Fair Trade Commission said the alleged collusion generated roughly KRW 2.02 trillion (U.S.$1.31 billion) in sales between 2018 and 2024. The 10 companies under investigation account for about 80% of South Korea’s metalworking-fluid market and 21% of its industrial lubricants market.
According to Korean media reports, the companies are Kwangwoo, Kukdong Oil & Chemicals, DH Chemical, Beomwoo Chem, Beomwoo Chemical, Beomwoo Finechem, Beomwoo Chemistry, SHL, Houghton Korea and Hanyu SK ETS.
The FTC alleges the companies coordinated price increases whenever raw material costs rose, with much of the conduct linked to disruptions caused by the pandemic and the war in Ukraine. The regulator said manufacturers across South Korea, including major automotive companies, paid inflated prices as a result.
The companies now have eight weeks to respond before the FTC holds a plenary session later this year to decide whether to impose corrective measures, financial penalties and potential criminal complaints against those involved.