Poland Demand Dipped in 2023

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Poland Demand Dipped in 2023
A worker repairs a loading machine in a copper mine owned by KGHM Polska Miedz in Lubin, Poland. © Dziurek / shutterstock.com

Poland’s demand for lubricants dropped by 1% in 2023 as the country’s economy stagnated, reflecting a broader decline in economic activity across Europe due to successive disruptions during the last several years.

These disruptions included the COVID-19 pandemic, the energy crisis in 2021, the Russian invasion of Ukraine in 2022 and subsequent sanctions and embargoes.

Poland consumed 234,742 tons of finished lubricants in 2023, a 1% decrease from 237,219 tons in 2022, according to the annual report of the Polish Oils Industry and Trade Association.

The report attributes this decline to the challenging situation in the transport, shipping, and logistics sector. It also relates to broader European trends affecting the lubricant industry, such as the energy crisis, the transition to a zero-carbon economy, and the electrification of transport.

In 2023, 42% of the lubricants consumed in Poland were automotive oils and 58% industrial oils, compared to 41% and 59%, respectively, in 2022.

Poland consumed 135,749 tons of automotive lubricants in 2023, a 3% decrease, and 98,994 tons of industrial oils, a 2% increase.

“Of these, 110,622 tons were automotive engine oils, or 4% less than in 2022,” the organization said, adding that this segment saw declines in demand for each category of motor oils, except for monograde oils, up 2%, and 0Ws and 5Ws heavy duty engine oils, which increased by 5%.

The automotive engine oils accounted for 47% of all lubricants sold in Poland, representing 82% of all sales within the automotive segment. Passenger car motor oils comprised over half of the total automotive oil market, with sales of 68,506 tons, a 2% increase.

However, sales of heavy-duty engine oils saw an 8% decline in 2023, dropping to 37,701 tons, compared to 41,040 tons.

The organization attributed this decline to existing difficulties in eastbound transport, competition from Ukrainian haulers benefiting from the European Union agreement with Ukraine, and protests by Polish haulers at border crossings with Ukraine.

It also highlighted the increasingly challenging business environment in freight transport, with operators needing to adapt to new regulations and guidelines related to the Mobility Package and sustainable development.

“The environmental issues require increasing commitment,” the annual report noted. “According to the Sustainability Reporting Directive, the first reports containing data for 2024 will already appear in 2025. Transport companies, even if not directly covered by the CSRD, will have to take into account requirements from their CSRD-reporting contractors.”

The CSRD is EU legislation that went into effect Jan. 5, 2023, that requires EU businesses – including qualifying subsidiaries of non-EU companies – to disclose their environmental and social impacts, and how their environmental, social and governance actions affect their business.

In the industrial sector, Poland consumed 98,994 tons of industrial oils in 2023, up 2% from 97,103 tons in 2022.

While the industrial sector has faced numerous challenges over the past four years, including the pandemic, the energy crisis, and the Russian aggression against Ukraine, there has been some improvement in the situation in 2023. However, industrial oil sales volumes have not yet returned to pre-pandemic levels, the report stated.

The Central Bank of Poland and other regulators have optimistic forecasts for the country’s gross domestic product growth but anticipate that not every industry will benefit, particularly steel manufacturers. The European Association of Steel Manufacturers, known as Eurofer, predicts a weakening of production in the automotive segment in 2024 due to weak export activity, especially to markets such as the U.S. and China, the organization said, citing data from Eurofer’s Economic and Steel Market Outlook 2023-2024.

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Automotive Lubricants    Europe    Finished Lubricants    Industrial Lubricants    Poland    Region