MOSCOW – Global lubricant demand should partially recover this year to reach 36 million tons, a 10 percent increase from 2009, driven by growth in emerging markets that should compensate for volume declines in mature markets, Fuchs forecasts.
The volume of lubricants in mature markets will definitely decline, Christian Ohligmacher, vice president and member of the executive committee at Fuchs Europe, told the Lubricants Russia 2010 conference earlier this month. However, the growth in the emerging markets to some extent will compensate for that decline. Lubricants as a modern construction element require higher efforts in R&D based on complex chemistry, not on raw materials. Based in Mannheim, Germany, Fuchs is the worlds largest independent lubricant marketer.
Fuchs found global lubricants demand in 2009 stood at 32.8 million tons, with the Asia Pacific region, dominated by China, making up 36 percent of the total. The mature markets of North America and Western Europe, where higher quality lubricants and specialties prevail, combined to account for 31 percent of the total world demand, Ohligmacher said. Central and Eastern Europe, dominated by Russia, make up roughly 13 percent of world lubricants demand.
Due to the global financial crisis, total demand in 2009 declined 13 percent compared to the year before. From 2001 to 2008, global lubricant demand was pretty stable, averaging 36 million tons per year and reaching 37.2 million tons in 2008, said Ohligmacher. Heavily hit by the worldwide recession, total lubricant demand slumped to 32.8 million tons in 2009.
Over the last eight years, per capita consumption of lubricants declined in all world regions. We have seen that per capita consumption decline is quite different globally. In 2001, North America had the highest per person lubricant consumption rate of 28.7 kilogram, Ohligmacher said, but by 2009 it had experienced the steepest decline, to 19.7 kg. Meanwhile, the Asia Pacific regions per capita consumption decline was the worlds lowest, he added, decreasingly slightly from 3.1 kg in 2001 to 2.9 kg in 2009.
The study also compared the change of per capita consumption with lube demand and average gross domestic product from 2001 through 2009. The mature markets of North America and Western Europe have seen declines in lubricants demand despite the growth of their economies GDP, according to Fuchs. It is not the case for South America and Asia Pacific regions, where we see nominal increase of the lube demand, especially in Asia, where the demand growth is very strong, Ohligmacher said.
Fuchs estimates the lube market will recover in 2010 in all world regions and expects a 10 percent increase compared to 2009, to 36 million tons, barely reaching the level of 2004.
As volumes go down and special lubes are required, specific R&D efforts will increase, Ohligmacher pointed out. This effect we will see all over the world – its going to be a global trend, he noted, adding that the future of lubricants will be less driven by volume than by quality.
Innovation in the new technologies such as electric power train and new materials are the main drivers, he continued. Higher performance of lubricants leads to higher efficiency of machines and equipment. A growing requirement for longer-lasting equipment, faster globalization of best practice technologies in segments such as the global automotive industry, and setting of specs by OEMs are key factors for the future development of the lubricant market.
The requirements lubricants must meet are becoming more complex. The high complexity of modern tribo-systems require tailor-made lubricants, while coordinated processes in manufacturing require comprehensive systems such as process fluids, corrosion inhibitors, cleaners, lubricants, said Ohligmacher. Leading requirements would be OEMs specific products specifications, rather than standard ACEA or API grades.
Lubricants and additives based on esters, biogenic raw materials or biomass-to-liquids fluids are upcoming new technologies, he noted. Raw materials would be based on renewable sources instead of fossil oils, and availability of complex raw materials would need to be secured globally, while local sourcing would be developed.
Environmental and legal concerns will influence lube demand overall. From the environmental perspective, we are asked to act in a more sustainable way. The issue of emissions and CO2 footprint is the ongoing trend in response to climate change. It reaches the whole industry, he said. Environmental and health regulations restrict us from the use of certain materials. Ohligmacher warned that the industry has to be prepared for a shortage of raw materials and resources such as crude oil and petrochemicals.