South Koreas demand for lubricating oil is projected to increase slightly to 917,137 metric tons in 2014, according to a report by the Korea Lubricating Oil Industry Association. That total would represent a paltry 0.4 percent increase from the level reported for 2013.
KLOIA said in its annual report that several factors conspire to keep the domestic lube marketfrom growing, despite the fact that gross domestic product has been expanding by roughly 1 percent per quarter and is expected to continue doing so. The association cited a trend of decreasing distances traveled by Koreans, improving fuel efficiency for passenger cars and growing numbers of hybrid cars.
KLOIA predicted that the countrys consumption of automotive lubricants will rise by 0.3 percent, while demand of industrial lubes will increase by 2.9 percent. It expects demand for marine lubes and metalworking fluids to increase by 2 percent and 2.2 percent, respectively, while demand for grease, insulating oil and other lubes are pegged to rise 0.6 percent, 1.7 percent and 0.3 percent.
With sales volumes in the market barely growing, the association advised member companies to focus on premium lubricants and foreign markets.
KLOIArepresents 20 lubricantmanufacturers, including four domestic integrated oil majors, GS Caltex, SK Lubricants, S-Oil and Hyundai Oilbank. An additional 28 member companies provide ancillary products or services.