Heavy Equipment Lubricants Market - Forecast(2024 - 2030)

Heavy Equipment Lubricants Market Overview

The Heavy Equipment Lubricants Market size is forecast to reach US$38.1 billion by 2027, after growing at a CAGR of 3 % during the forecast period 2022-2027. Heavy equipment lubricants are used for the purpose of reducing friction, preventing wear, and protecting the equipment from corrosion. Lubricants mainly comprise of base oil and can be either synthetic or mineral-based. Lubricating oils are primarily made of 80-90% petroleum hydrocarbons distillate that constitutes 10-20% additives that help in imparting specific properties to the oil. The synthetic base oil used in heavy equipment lubricants primarily consists of polyalphaolefins. Heavy equipment lubricating oils are widely used in automobiles, internal combustion engines, marine engines, and other construction and mining machinery. An increase in manufacturing activities in the Asia-Pacific region, the requirement of timely maintenance of heavy equipment and machinery due to friction, and growing demand for high-performance lubricants in the construction and mining sectors can act as major drivers for the market. Strict rules and regulations regarding the fuel economy and emission outputs can act as a major constraint for the market.

COVID-19 Impact

There is no doubt that the COVID-19 lockdown has significantly reduced construction, mining, and marine activities which in turn, has resulted in the decline of the supply and demand chain all over the world, thus, affecting the market. Due to the fluctuating price of raw materials required for heavy equipment lubricants in construction, mining, agriculture, and other sectors, the growth of the Heavy Equipment Lubricants Market was constrained. Studies show that the U.S., China, Italy, and India were the highly affected countries in this market due to the pandemic. However, a slow recovery in new mining, development, and construction contracts has been witnessed across many countries around the world since 2021. For instance, The Iron Bridge Magnetite project that is expected to deliver 22mtpa of high-grade 67 percent Fe magnetite concentrate product is currently undergoing development. The overall cost of the project is expected to reach around £1.96 billion (US$2.35 billion) Mota-Engil.

Likewise, the Portuguese mining contractor recently made an announcement that it had signed a contract worth £220.3 million (US$ 263.8 million) through its African subsidiary solely for the purpose of preparation, excavation, and transport at the Gamsberg zinc mine located in South Africa’s Northern Cape. The preparation of the project work started by April 2021, with a maximum duration of 96 months. The project activities included site preparation, blasting, drilling, and excavation of waste and ore. It also included construction and maintenance work of roads, dewatering, and lighting. In this way, a slow and steady increase in mining, development, and construction activities will require the use of heavy equipment and machines. This will eventually lead to an increase in demand for heavy equipment lubricants which indicates a slow and steady recovery of the market in the upcoming years.

Report Coverage

The report: “Heavy Equipment Lubricants Market – Forecast (2022-2027)”, by IndustryARC covers an in-depth analysis of the following segments of the Heavy Equipment Lubricants Industry.

By Base Oil: Synthetic Oil and Mineral Oil.
By Type: Engine Oil, Transmission and Gear Oil, Greases, Hydraulic Oil, Turbine Oil, Others.
By Application: Agriculture, Construction, Mining, Marine, Others.
By Geography: North America (USA, Canada, and Mexico), Europe (the UK, Germany, France, Italy, and the Rest of Europe), Asia-Pacific (China, Japan, India, South Korea, and the Rest of Asia-Pacific), South America (Brazil, Argentina, and the Rest of South America), the Rest of the World (the Middle East, and Africa)

Key Takeaways

• Engine oil in Heavy Equipment Lubricants Market is expected to see the fastest growth, especially during the forecast period. The major reason behind this is the number of advantages they hold such as enhanced performance, fuel efficiency, and adequate temperature control along with engine protection. Engine oil is also mostly preferred and used for lubricating internal combustion engines in different types of machinery.
• Asia-Pacific dominated the Heavy Equipment Lubricants Market in 2021, based on revenue, with China being the one to dominate the market. The major reason behind this is the fact that the Chinese construction industry has seen some significant growth in the development of rails and road infrastructure by the Chinese Government in recent years. This, in turn, has increased the demand and consumption of heavy equipment lubricants leading to significant market growth.
• New environmental-friendly Heavy Equipment Lubricants are being developed in order to reduce the effects of petroleum-based lubricants that constitutes of hydrocarbons distillates that can have a negative impact on the environment. 

Figure: Asia-Pacific Heavy Equipment Lubricants Market Revenue, 2021-2027 (US$ Billion)

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Heavy Equipment Lubricants Market Segment Analysis – By Base Oil

Synthetic oil held the largest share in the Heavy Equipment Lubricants Market in 2021. The synthetic base oil used in heavy equipment lubricants primarily consists of polyalphaolefins and it also holds some major advantages in comparison to heavy equipment lubricants based on mineral oil. Some of its major advantages are its properties such as high viscosity index, water solubility, and bio-degradability. Strict environmental regulations to reduce carbon emission is most likely to increase the sale of mineral-based heavy equipment lubricants in the upcoming years.

Heavy Equipment Lubricants Market Segment Analysis – By Type

The engine oil held the largest share in the Heavy Equipment Lubricants Market in 2021 and is expected to grow at a CAGR of 3.2 % between 2022 and 2027. Engine oils are most commonly used for lubrication of internal combustion engines for a wide range of construction, mining, and other machinery. They also hold some major advantages in comparison to other oils in the heavy equipment lubricants market such as enhanced performance, adequate temperature control, and engine protection. Engine oils can be either mineral-based or synthetic-based that mainly constitutes of polyalphaolefins. Recent studies show that the FIFA World Cup that is to be held in 2022 in Qatar is expected to generate the huge potential for heavy equipment and machinery used in the country. A company called Larsen and Toubro signed a contract worth $ 360 million along with its joint venture partner in Qatar, in order to build a 40,000 seater stadium. This project required the use of heavy construction equipment and machinery in order to build such a huge stadium. Likewise, other countries such as Kuwait, Morocco, and Iran are also estimated to have higher growth in the construction sector during the forecast period. All of the above factors will directly result in an increase in demand for engine oils used in heavy equipment lubricants as well, thus, boosting the market growth.

Transmission and Gear Oil in Heavy Equipment Lubricants Market held a significant share in 2021. These oils were primarily used for protecting the transmission components of the vehicle and for protecting the gears from wearing off. However, due to problems such as material compatibility, its reaction with water, and higher price, eventually acted as a market constraint in comparison to engine oils. Hydraulic oils are used in hydraulic systems in order to generate enough force to move equipment and materials. However, factors such as higher cost, poor resistance to a working fluid, the danger of hidden leakage, and sensitivity to temperature changes acted as a constraint for market growth.

Heavy Equipment Lubricants Market Segment Analysis – By Application

The Construction application held the largest share in the Heavy Equipment Lubricants Market in 2021 and is expected to grow at a CAGR of 3.4 % between 2021 and 2027. Heavy equipment lubricants are basically used to reduce the friction caused between moving parts or surfaces and to improve the overall efficiency of the equipment and machinery used in the construction industry. Heavy equipment lubricants are commonly used in various construction equipment such as bulldozers, excavators, loaders, graders, trenchers, and other heavy equipment. Recent studies show that there has been significant growth in the construction industry in the Asia-Pacific, Middle East, and Africa Regions. For example, the Chinese government announced to invest US$ 120 billion in the construction of railway projects in 2019. Since then, China has seen significant growth in the construction of rail and road infrastructure. According to Volvo CE, the construction sector saw an increase in the sales of heavy equipment across multiple regions since the fourth quarter of 2020. South America saw an increase of 12%, Asia by 39%, Europe by 20%, and China by 28%. Turkish construction equipment manufacturer HIDROMEK also exceeded the global sales of 50,000 heavy equipment construction machines in 2020. All of these factors increased the demand for heavy equipment lubricants to be used in the equipment and machinery, thus, leading to the growth of the market in the upcoming years.

The Mining application also held a significant share in the heavy equipment lubricants market in 2021. Heavy equipment lubricants were mostly used in mining equipment and machines such as bulldozers, pavers, and other heavy equipment. In March 2021, Coal India Ltd (CIL) approved 32 mining projects with an investment of around INR 47,300 crore in order to achieve its target goal of 1 billion tons coal production by 2023-2034.

Similarly, an increase in mining activities across various countries around the globe will eventually increase the use of heavy equipment and machinery. This would play a major role in increasing the demand for heavy equipment lubricants as well.

Heavy Equipment Lubricants Market Segment Analysis – By Geography

The Asia Pacific held the largest share in the Heavy Equipment Lubricants Market in 2021 up to 30%. Currently, China is leading the market with some of the highest numbers of undergoing construction and mining activities. China is considered to be one of the largest producers of gold, coal, and other minerals. Studies show that there are over 10,000 mines all over the country that is expected to generate the largest amount of the total world’s supply. Likewise, an infrastructure company called Power Mech Projects based in Hyderabad, India, obtained a mine development and operation project worth INR 9,292 crore (US$ 12.6 million). The contract mainly includes mine infrastructure development, along with extraction, removal, processing, crushing, and transportation of coal. The concession period is expected to be of 25 years which includes two years of the development period. All of these factors have significantly increased the demand for heavy equipment lubricants to be used in the construction and mining machinery, thus, increasing the market growth.

Heavy Equipment Lubricants Market Drivers 

An increase in mining, construction, and development activities in the Asia-Pacific region is most likely to increase demand for the product

Construction and manufacturing activities are considered to be the pillar of growth for a country and also play a major role in increasing the overall global economy. According to recent studies, Asia-Pacific is expected to be the largest market for heavy equipment lubricants in the mining, construction, and manufacturing sectors. Since 2019, countries like China and India have come up with multiple constructions and mining projects. In 2020, China came up with a new infrastructure plan targeting to develop the metal industry. This project includes the installation of industrial motors and distribution transformers with higher efficiency, along with the electrification of new railways. Similarly, China Coal Mine Construction Group Corporation (CCMC) recently obtained the proposal for the South Asia Sub-regional Economic Cooperation Mugling-Pokhara Highway Improvement Project in Nepal in April 2021. This contract is valued at around ¥450 million (US$ 4.1 million). In March 2021, Coal India Ltd (CIL) approved 32 mining projects with an investment of around INR 47,300 crore (US$ 43.6 million) in order to achieve its target goal of 1 billion tons coal production by 2023-2034. In this way, an increase in construction and development activities will most likely increase the demand for heavy equipment lubricants to be used in the heavy construction equipment machinery.

Requirement of timely maintenance of heavy equipment and machinery due to friction

Since heavy equipment and machinery used in construction, mining, agriculture, and marine sectors are highly prone to a large amount of friction that may occur while continuously running the equipment or machine, it often requires timely maintenance to preserve its functions and structure. Heavy equipment lubricants protect the equipment and machinery against friction, corrosion, and prevent it from wearing off. This is one of the reasons why heavy equipment lubricants are opted time and again to prevent machines and equipment from degrading at a larger scale. This, in turn, can lead to significant growth in the Heavy Equipment Lubricants Market.

Heavy Equipment Lubricants Market Challenges

Strict environmental regulations can cause an obstruction to the market growth

Strict rules and regulations regarding the emission outputs can act as a major constraint for the market. In the case of environmental emissions, Legal regulations state that the application of lubricants that are biodegradable, eco-friendly, and harmless to the environment should only be allowed, and lubricants made from the natural origin are preferred. The majority of the heavy equipment lubricants that are currently used in the market are considered to have some negative impacts on the environment. Petroleum engine oils that are widely used for lubrication of internal combustion engines constitutes of hydrocarbons distillates that can be harmful and toxic to plant and animals along with their natural habitat. However, new environmental-friendly Heavy Equipment Lubricants are being developed in order to reduce carbon emissions and the effects of petroleum-based lubricants that constitute of hydrocarbons distillates that can have a negative impact on the environment.

Heavy Equipment Lubricants Market Landscape

Technology launches, acquisitions, and R&D activities are key strategies adopted by players in the Marine Deck Coatings market. Marine Deck Coatings market top companies are:

1. BP PLC
2. Chevron USA Inc.
3. China Petroleum & Chemical Corporation (Sinopec)
4. Exxon Mobil Corporation
5. JX Nippon
6. Royal Dutch Shell PL
7. Total Energies SE
8. Fuchs Petrolub SE
9. Gazprom Neft PJSC.
10. Gulf Oil Corporation Limited

Acquisitions/Technology Launches

• In April 2021, BP Amoco Plc made an announcement that it is going to buy out India's Tata group stake in lubricant marketing joint venture Tata-BP Lubricants India Ltd.
• In October 2020, Chevron Corporation made an announcement that it had completed its acquisition of Noble Energy, Inc. following the approval made by Noble Energy shareholders.

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