Lubricants consumption has suffereda 24 percent plunge in 2007, when the country suffered from the Asia financial crisis, and has seen a 1.9 percent decrease in 2012, more recently, the report said. Lubricant suppliers should set similar levels of sales targets as last year and mount a flexible response to changing market conditions.

The Seoul-based group, which represents the main lubricants manufacturers in South Korea, predicted the countrys lubricants demand in 2016willincrease only 0.9 percentto930,000 metric tons. Among the reasons that it cited are a lackluster global economy; a slowdown of economic growth in China, its major trading partner; and a shrinking domestic manufacturing sector.

The association predicts that demand forautomotive lubricants will rise 1.1 percent in 2016 to 327,437 tons and that demand for industrial lubricants will grow 0.9 percent to 173,008 tons. It expects demand for metalworking fluid and rust preventives to increase 0.8 percent to 116,534 tons, marine oils to rise 6.6 percent to 101,768tons, grease to rise 0.5 percent to 16,626 tons and electrical insulating fluids is to fall by 4.1 percent to 21,785 tons.

As for 2015, the associationestimated that lubricants consumption decreased 1.4 percent to921,746 tons. It attributed the decline to a domestic economic depression resulting from an outbreak of Middle East Respiratory Syndrome (MERS) and the manufacturing sectors most difficult slump since the global financial crisis in 2008.

Marine lubricants fared the worst, undergoing a 12.4 percent drop in demand. That occurred because of a slump of South Koreas shipbuilding sector, which ranks largest in the world. Faced with the global economic slowdown, deliveries of constructed ships are being delayed and placed orders are being retracted, the report said.

The South Korean governmentforecasts 3.1 percent economic growth rate for 2016, better than the 2.7 percent growth the company experienced in 2015.