In contrast, Morocco and South Africa’s cars are younger and require more modern lubricants formulated with Group II base oils. In fact, some industry experts have predicted the African continent will make a switch from Group I to Group II within the next decade.

However, the question of whether African countries as a whole will join the global shift to Group II remains. A clearer picture of the future of the African lubricant market is emerging, and it seems to suggest that Africa may never entirely adopt lubricants blended with Group II because there will continue to be a need for servicing the plentiful number of old cars being driven on the continent.

What will emerge, industry experts suggest, is a hybrid lubricant market in which Group II will coexist with Group I on equal footing. This means that African lubricant manufacturers will market products depending on the specificity of their market and the requirements of each application.

Industrialization

Rakesh Vyas, market development advisor at ExxonMobil, explained that one of the most notable differences between Africa and other regions of the world is that a lot of heavy industries are still growing on the continent and are still being incentivized either through special tax schemes or economic zones. This is not the case in other regions.

He also noted that many industrial sectors and applications are currently using a lot of monograde oils. For instance, Nigeria, being a generator-powered economy, is a good example.

“A lot of those diesel generators have preferences to monogrades, and monogrades tend to be formulated using Group I base stocks,” said Vyas. “So, you have a growth in industrial applications, which is leading to a growth in industrial lubricants demand.”

Najib Aragrag, base stocks technical advisor for ExxonMobil, explained that the type of lubricant used is dependent on the application. “If you look at the heavy-duty and passenger car sector, we can see a growth in Group II simply because of the lubricants that are being put in the new cars and trucks. So, these lubricants are formulated to meet the original equipment manufacturers’ standards that are required,” said Aragrag.

However, Aragrag added that when considering the older, used cars on the road, they are most likely using Group I in their finished lubricants, thus solidifying the notion that the type of base stock used depends largely upon the sector and application in which lubes are being used.

Aragrag emphasized that there are many OEMs in Africa, especially in South Africa and Morocco, that are putting new cars and trucks on the road that require higher-quality lubricants that are blended using Group II base oil. However, he acknowledged that to cater to the operation of existing equipment, “You will need existing base stocks and existing [lubricant] formulations.”

Solvency and Volatility

Vyas explained that API Group I base stocks have solvency power and will be needed in industrial applications such as marine and some greases. This is because those applications require heavy neutral Group I base oil to get their jobs done.

“Then your volatility will be important, and that [need] will be met by your Group II base stocks. So, it all depends on the performance that you are targeting given your base stock’s characteristic,” Vyas added.

Hybrid Lubricant Market

Vyas emphasized that on a micro level, Group I is growing in Africa. He advised that as an “individual blender or lubricant manufacturer, you have to look at the applications and the sectors that you are servicing, the markets that you are serving, the products lines that you have and the formulations that you have, and select base stocks that cater to those applications.” He explained that in some applications, Group I has an advantage over Group II and vice versa, depending on the applications.

He argued that instead of looking at affordability differences, blenders and lubricant manufacturers in Africa should consider their total cost to formulate and blend. After all, it would be unwise to consider only the price of base stocks.

Additionally, Vyas said that depending on base stock choices, blenders may have the optionality to reduce their additive treat rate or requirement for Group III within their total cost of formulation.

“You may be paying more for certain base stocks … but it could reduce your cost elsewhere in your blending and formulation cost. So, we would always encourage blenders to look at their total cost of formulation when considering prices of base stocks.”

However, he added that not all Group II base stocks are the same, stressing that ExxonMobil’s Group II products differ significantly from other Group II base stocks.

“You need to look at the total cost of formulation,” he explained. “I think that is the thing that blenders in Africa need to focus on. Even when they need to make a transition between Group I and II, they also need to consider the total cost of formulation. Is it meeting their application needs or technical needs? Is there a cost benefit to do so?” Aragrag said it is important for African blenders to ensure that they have the right base stocks and finished products. He noted that switching from Group I to Group II should not be seen as a challenge but added that it is always better for both consumers and lubricant manufacturers to consider “the application, the total cost of formulation and whether it will have a negative impact on their application.”

Advantages of Hybridity

Vyas explained that blenders and manufacturers in Africa are in an advantageous position. Blenders in other regions are pushed toward using Group II by legislation to improve fuel efficiency, as well as developing lubricant application specifications. Pressure from emissions targets is not as strong in many parts of Africa and application demands are more segregated. “The drivers are not as strong towards Group II, which gives you as a blender in Africa a nice position to be in because you can use Group I or Group II. And it gives you more optionality versus blenders in other regions, and I take it as a positive point,” said Vyas.

Similarly, Aragrag said that consumers in Africa are also at an advantage because the major focus of consumers is being able to obtain products that will serve their purposes.

“Give me a product that will keep my trucks or factory running. That is all they ask for,” Aragrag added. Vyas concurred, stressing that “as far as the base oil is meeting their required application needs, African blenders have the optionality to do that, so the consumers are advantaged in that respect.”

Forecast

The future of the African lubricant market is one that will require prominent usage of both Group I and Group II base stocks. After all, odds are good that it will take more than a decade to rid Nigeria and Egypt, for example, of all the old cars. Furthermore, existing lubricant applications will stubbornly stick around and lube formulations using Group I base stocks will be necessary. All in all, there will continue to be old cars and antiquated applications in Africa, even as new cars and heavy-duty trucks line the continent’s roads.