Lubricant consumption is shifting to higher quality products around the world, but overall volume growth is generally found only in developing countries. Given those trends, it is little surprise that a new study identifies parts of Asia, Latin America and Eastern Europe as the lubricant markets with the most opportunity.
Freedonia Group said Monday it has completed a study forecasting that global consumption of finished lubricants will grow 2.2 percent annually to 39.3 million metric tons in 2008, versus 35.3 million tons in 2003. The Cleveland market research firm identified China, India, Indonesia, Russia, Brazil and Mexico as large markets primed for above-average growth. It projects annual growth of 6 percent for China and of between 3 percent and 3.5 percent for the other five nations.
Growth rates of 3 to 3.5 percent may not qualify as skyrocketing, but it is certainly very promising compared to the more minimal growth that you are going to find in the mature markets, Chris Jellen, an industry analyst with the firm, told Lube Report.
The study, World Lubricants, projects lube demand in Asia/Pacific will grow 3.4 percent per year to 12.8 million tons in 2008. On the other hand, it expects Western Europe to remain grow just 0.3 percent to 5.3 million tons and North American demandtorise 1.3percent per year to 11.4 million tons.
On a global basis,Freedonia predicted that lengthening drain intervals will keep growth rates for automotive lubes lower than those for the industrial segment, which should benefit from worldwide growth in manufacturing.
The firm maintained that opportunities exist even in developed nations, thanks to the trend toward higher quality and more environmentally friendly lubricants formulated with synthetic or highly refined base stocks. It projected that demand for non-conventional lubes will grow 5.4 percent annually and account for more than 10 percent of the global market by 2008.
The potential for improved quality in developing nations is vast, Jellen said, but the trend is occurring all over the world.
Freedonia pegged the value of worldwide lube sales at $28.6 billion in 2003 and predicted it will grow 4.7 percent annually to $36 billion in 2008. Jellen said the increase will be due to a combination of higher volume, higher prices and product mix.
The 369-page study sells for $5,100. Information is available at www.freedoniagroup.com.