Japan’s Lube Demand Forecast to Fall

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The Petroleum Association of Japan forecast that lubricant demand in Japan this year will drop 0.6 percent to 1.3 million metric tons due to a slowdown in the nation’s marine and industrial lubricant markets.

Demand for automotive lubricants is expected to remain the same at 510,000 tons, while marine lubricants are projected to fall 1.2 percent to 75,000 tons and industrial lubricants to drop 0.9 percent to 720,000 tons.

Against a backdrop of domestic cargo transportation volumes remaining the same as the previous year, we think the volume of shipbuilding will continue to remain flat, the association said in a recent press release.

For the automotive sector, postponement of the implementation of a consumption tax hike implies there is no possibility of a surge in demand, the association continued. The segment has been and should continue to be led by factory fill lubes supplied for gasoline-powered passenger vehicles built for export to North America and China.

According to the PAJ, total lubricant consumption in Japan fell 3.4 percent in 2015. Both marine and industrial lubricants fell by a greater percentage than the previous year. Marine lubricant consumption decreased the most – by 5.6 percent to 76,000 tons – due to a shortage of labor, resulting in a reduction in the volume of shipbuilding projects and a drop in volume of domestic cargo transportation and others for 2015.

Industrial lubricant demand fell 3.6 percent to 726,000 tons due to a slowdown in domestic consumption and in emerging regional economies like China, resulting in stagnant industrial output.

Although automotive lubricant consumption fell the least last year (2.7 percent to 510,000 kiloliters), PAJ said gasoline and diesel engine cars production fell due to a huge drop in demand after the light-duty automotive tax hike in April.

Photo: ajisashi / Wikimedia Commons

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