The world market for fuel additives is forecast to grow 4.7 percent per year to 26.5 million metric tons in 2016, with demand in value terms advancing 8.0 percent per year to $59.4 billion. Total fuel additive demand in volume terms is heavily dominated by gasoline oxygenates, such as methyl tertiary butyl ether (MTBE). In 2011, ether oxygenates accounted for 94 percent of total demand. These and other trends, including market share and product segmentation, are presented in World Fuel Additives, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm.
Excluding oxygenates, global demand for specialty fuel additives is projected to expand 3.6 percent per year to 1.5 million metric tons in 2016. The rapidly expanding fuel market in China will drive advances, particularly as China’s fuel standards become stricter and additive treat rates rise. Globally, deposit control additives will exhibit the greatest gains, promoted by higher standards needed to accommodate the increased use of newer engine technology. Cold flow improvers will be the fastest growing product type, though from a much smaller base.
Going forward, demand for both oxygenates and specialty additives will be influenced by changing standards for vehicle emissions, fuel quality, and engine efficiency. Many industrializing nations began significant regulation of fuels after 2006, in response to concerns over air and water pollution. One of the biggest influences on fuel additive demand is the use of low sulfur diesels. While most industrialized nations have already met their target sulfur levels, many industrializing nations have not yet fully transitioned to low sulfur diesels, which need higher levels of lubricity improvers, cold flow improvers, and other additives.
Many countries have also adopted biofuel mandates as a way to reduce overall consumption of petroleum products. In order to meet targeted biofuel levels, many countries are expected to increase the levels of ethanol and biodiesel blended into their gasoline and diesel supplies. Ethanol and biodiesel use will have a substantial impact on fuel additive demand by necessitating increased use of antioxidants, corrosion inhibitors, cold flow improvers, and other products. Biodiesel will also have a negative impact on additive demand, as it leads to lower usage rates for lubricity improvers and cetane improvers.
The Freedonia Group is a leading international business research company, founded in 1985, that publishes more than 100 industry research studies annually. This industry analysis provides an unbiased outlook and a reliable assessment of an industry and includes product segmentation and demand forecasts, industry trends, demand history, threats and opportunities, competitive strategies, market share determinations and company profiles.