Asia-Pacific Leads in Marine Lubes


The Asia-Pacific region accounted for more than half of the 2.1 million ton total of global marine lubricant demand in 2013, consultancy Kline & Co. estimated, and is projected to account for close to 60 percent in 2023.

Global marine lubricant consumption will stay nearly flat, with 1 percent compound annual growth per year from 2013, reaching about 2.3 million tons by 2023, Kline projected.

The 2.1 million tons of demand in 2013 was down 0.7 percent from 2010. Marine lubricant demand has been declining over the last few years, primarily because of the weak global economy, Kunal Mahajan, project manager, energy, for Kline & Co., said during a webinar Sept. 10.

Asia-Pacific is the biggest consumer of marine lubricants and is also expected to grow the fastest as the economies of the region grow, Mahajan said. Demand growth will be led by China, he said, as it is the largest container market globally.

Kline projects that shares for Europe and North America will decline. Again, because economic growth in these regions is much lower compared to Asia-Pacific, he said. Other regions like South America, Australia and others show some growth but will not be as substantial as growth in Asia.

Mahajan said five suppliers together account for about 90 percent of the total marine lubricants market. Castrol led with a 24 percent share, followed by ExxonMobil at 22 percent, Shell and Total Lubmarine with 16 percent each, and Chevron at 10 percent.

Trailing the top five are Lukoil, Gulf Oil Marine, Aegean and others.

While the top five continue to dominate, the smaller players are very aggressive in this market and are trying to gain as much market share as possible, he said.

Consumption by seagoing vessels accounted for 87 percent of marine lubricants demand, with in-land/coastal use accounting for the remaining 13 percent.

Most of the demand for marine lubricants comes from the deep-sea segment, which is essentially the shipping companies in seaborne trade, Mahajan said. Container shipping is one example. The inland and coastal segment covers mainly fishing companies and passenger ships that operate in inland waterways.

Cylinder oils accounted for the majority of marine lubricants in 2013, with nearly 1.1 million tons of demand, followed by trunk piston engine oils at 656,000 tons. Far behind were system oils, with 205,000 tons and other types of lubricants used in ships, such as stern tube lubes and gear oils, accounting for the remaining 123,000 tons.

Mahajan said five key factors drive the demand for marine lubricants: an increase in global seaborne trade, the impacts of slow steaming, an increasingly younger and more efficient fleet, regulations and engine design.

With global seaborne trade, the higher the trade, the higher the utilization of seaborne ships, and therefore the higher the lubricant demand, Mahajan said. After the economic crisis, seaborne trade growth has been slow. As the global economy recovers, he said Kline expects seaborne trade will grow at a compound annual growth rate of 4 percent until 2020. Moreover, this growth will also be driven by growing economies in Asia, and their demand for commodities, he added.

Mahajan explained that slow steaming is essentially sailing ships at slower speeds to save fuel. Slow steaming has become normal operating practice across all shipping companies, and because of the slow steaming, fuel consumption has gone down, he said. That has had an adverse effect on marine lubricant demand. At the same time, because ships are operating at slower speeds, engine load has had to be reduced.

Klines study is titled, Global Marine Lubricants, 2013: Market Analysis and Opportunities.