Global lubricant additive consumption exhibited moderate growth in 2015, estimated to have increased by 1.0% over 2014. This consumption is forecast to increase by 1.6% through 2019, with strong growth stemming from regions like Asia-Pacific, Africa, the Middle East, and South America, according to the recently published Global Lubricant Additives: Market Analysis and Opportunities report by global market research and management consulting firm Kline.
The growth rate for lubricant additives is higher than the growth rate for finished lubricants. Growth varies significantly across function class. For instance, the focus on long-lasting engine oils, engine cleanliness, and fuel economy drives an increase in the usage of dispersants, antioxidants, and friction modifiers. Greater use of multigrade engine oils drives the usage of viscosity index improvers. In contrast, due to issues of compatibility with emission control devices, the use of detergents and antiwear additives is dampened.
The Canadian salon hair care market can be characterized by small, but steady growth, the dominance of leading multi-national companies, and stiff competition—not only among the large market-movers, but also the emerging independent brands making their presence notable in the industry. In the following interview, Naira Aslanian, Project Manager for Kline’s Consumer Products Practice, reveals some interesting facts about this market from the soon-to-be-published Salon Hair Care Global Series: Market Analysis and Opportunities.
Kline, a global market research and management consulting firm specializing in the downstream petroleum and specialties sector, and SBA Consulting, which focuses on global analyses of the base oil market, announced a new joint initiative to analyze the financial performance and survivability for base oil plants with the launch of a client-confidential study called the Base Oil Plant Health Check.
The market for janitorial cleaning chemicals in Europe, which until recently was flat to declining, posted modest growth of 1.6% in 2014, according to Kline’s recently published study Janitorial Cleaning Products in Europe: Market Analysis and Opportunities. Improving economies, end users’ preferences for multipurpose product features, and the need to maintain clean and germ-free facilities contribute to the market’s growth.
Commercial and institutional end users in Europe consumed an estimated EUR 1.5 billion worth of janitorial and housekeeping cleaning products in 2014. Building and contract cleaners are the leading end-use segment in Europe and performed above the overall market growth due to a growing number of end users outsourcing their cleaning to contractors.
Drawing upon on our new and exciting feature, a complimentary highlights report that comes with subscription to our annual Cosmetics & Toiletries USA report, we’ve selected several trends to watch out for as we enter 2016.
The rise of consumerism and expression of individualism
The beauty industry projects a further rise in consumerism and expression of individualism. The unique needs of consumers are addressed by marketers who offer personalized solutions and custom-made products.
The recent food poisoning outbreak at Chipotle Mexican Grill restaurants across multiple states has caused hundreds of consumers to become sick from E. coli, norovirus, and salmonella poisoning. Initially, in October 2015, the problem was thought to be contained to 11 restaurants in Washington and Oregon. The restaurant chain proactively closed over 40 locations in those two states to deep clean, sanitize, and restock with all new ingredients. Since then, there have been 11 additional states where people have reported illness after eating at Chipotle restaurants, including over 140 cases of norovirus, mostly among college students in Boston, MA. The problem is so widespread it has triggered a grand jury subpoena and a federal investigation lead by the U.S. Department of Justice and U.S. Food and Drug Administration.
While global wax demand is projected to grow at a compound annual growth rate (CAGR) of 1.5% until 2019, wax supply growth will be much slower at a CAGR of 0.4% during the forecast period. Despite strong growth in the supply of synthetic and natural waxes, growth in overall supply will not suffice to meet the increase in demand, finds the recently published Global Wax Industry: Market Analysis and Opportunities report by global market research and management consulting firm Kline.
The OTC industry continues to consolidate and transform itself with companies merging or acquiring/divesting brands. Recent examples include the merger of Bayer’s and Merck’s OTC businesses, the joint venture between GlaxoSmithKline’s and Novartis’ consumer health units, and Sanofi’s upcoming acquisition of Boehringer-Ingelheim’s OTC unit. With acquisitions come synergies, such as more media buying power, widened retail distribution, and competitive strengths across more OTC categories. However, mergers and joint ventures can also lead to increased costs of raw materials, packaging, and processing to manufacture a larger array of products. Increased marketing expenditures in support of newly acquired brands also impacts profitability, with the longer term goal of increasing sales and market share. Sales growth of acquired brands can help offset additional costs in cost of goods sold (COGS) and marketing.
The Chinese economy’s slowdown and reorientation has significant implications for the lubricants market in China, as well as the global market overall. The efforts to improve China’s air quality will accelerate the use of high performance lubricants while demand growth in other segments will slow down.
In 2014, China’s consumption of commercial lubricants declined by over 3% due to the industrial segment’s poor performance. Although we estimate a slow recovery through 2015 and possibly 2016, the government is continuously creating policies to stimulate the economy; furthermore, consumption is expected to grow slightly starting in 2017.
In January 2014, Kline, a worldwide consulting and research firm serving the needs of organizations in the lubricants and base stocks industry, introduced its monthly Base Stock Margin Index, a characterization of recent cash margin contributions in the U.S. base oil market over the past 24 months.
The Index estimates cash margin contributions associated with U.S. Group II base stock production. It simulates EBITDA before the deduction of corporate SG&A expenses for typical VGO-based virgin base stock plants and RFO-based re-refineries. A more detailed description of the Margin Index can be found in the January 2014 release.