According to a recent study on the metalworking fluid industry by Kline & Company, robust revenue growth is anticipated from increased interest in higher quality metalworking fluids such as synthetics, semi-synthetics/synthetic blends and water-soluble products. Asia (primarily China, India, South Korea, Indonesia, Thailand and Japan), Russia and Brazil are expected to be the growth engines of the industry in the near future.
The metalworking fluid market currently accounts for approximately 6 percent of the total estimated 38-million-ton global lubricants market. Significant contractions in automotive and metals production as a result of the global economic crisis led to depressed metalworking fluid demand. However, the recent rebound of the automotive industry has brought a significant uptick in demand for metalworking fluid products.
Market drivers such as regulation, application and innovation are expected to have an impact on the metalworking fluid industry in the future. From a volume standpoint, a growth rate of 3 percent is predicted, but this will not be enough to compensate for the significant volumes lost in 2008 to 2009.
The metalworking fluid market remains extremely fragmented with more than 50 percent served by smaller players who are focused on particular end-use applications, geographic area or both. These smaller but well-established and trusted marketers potentially represent lucrative turn-key acquisition opportunities for strategic buyers not yet active in this business or those wishing to increase their market share.
Considerable interest has also been generated in the private equity community for opportunistic buy and builds in this industry. For example, Houghton became the global market leader after the addition of the DA Stuart and Shell metalworking fluid businesses.
Kline’s complete study of the metalworking fluid industry is available as a standalone or as part of "Global Lubricants: Market Analysis and Opportunities" to provide metalworking fluid formulators, marketers, additive suppliers and end users with the latest information on products, services, applications and trends.
For more information, visit www.KlineGroup.com.