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Frost & Sullivan predicts global revenues from metalworking fluid sales to reach USD12 billion by 2020

A recent report on the global metalworking fluids industry by Frost & Sullivan finds that regulations on wastewater treatment and disposal are compelling end users to optimize their use of mineral oil-based metalworking fluids.

“Regulations on wastewater treatment will also be a major driver in Europe and North America,” the company said in the report.

It expects the use of semi-synthetic and synthetic metalworking fluids that offer a good balance between cost and performance to grow. The global metalworking fluids market is expected to reach USD12.09 billion in revenues by 2020, up 37% from USD8.83 billion in 2013.

While the burgeoning Asian automotive industry is expected to boost sales volume, the replacement of metals with plastics and composites in several applications will somewhat taper demand for metalworking fluids, according to Srinivas Venkatesan, a research associate with Frost & Sullivan.

“For instance, the automotive and aerospace industries use plastics and composites for light-weighting. Similarly, the preference for cartons over beverage cans is likely to impact the demand for metalworking fluids from the packaging industry,” he said.

In addition, the development of technologies such as minimum quantity lubrication, high pressure machining, and near-net-shape casting could replace conventional metalworking processes thereby reducing the demand for metalworking fluid. Advancements in

3-D printing could further hamper uptake as materials processed through laser sintering technology have good mechanical properties and an excellent surface finish, he said.

In the face of these challenges, product differentiation is essential to succeed in the market. “Metalworking fluid manufacturers must undertake research activities in collaboration with customers to develop cost-effective solutions that can satisfy constantly changing end-user requirements,” the company said in a statement.

Further, it expects established manufacturers who are looking to broaden their portfolios to continue to look for acquisitions, specifically regional vendors with specialized capabilities and a strong customer base.