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Fuel additives market: An industry growing steadily
The global fuel additive market will be experiencing a good growth in the next five years on account of the growing trend of improving fuel efficiency and stringent environmental regulations, amidst accelerating fuel consumption along with escalating fuel prices. Diesel fuel applications have emerged as the biggest consumer of fuel additives. Diesel fuel additive market in turn has been driven by the increasing Ultra Low Sulfur Diesel (ULSD) and bio-based diesel demand which requires significant amount of dosing.
Asia-Pacific to be the largest market by 2019
North America has been the biggest market for fuel additives and will continue to grow in the next five years due to stricter enforcement of environmental regulations. Asia-Pacific fuel additive market will be growing with the highest CAGR among all regions till 2019.One of the key factors contributing to this growth is the increased usage of fuel additives in emerging Asia-Pacific economies, due to increasing fuel demand from developing economies such as China, Japan, and India. The South American market is expected to grow at high rate partly due to low base effect and also due to the growing economies of Brazil and Argentina. The Middle East and African region is likely to register sound growth due to the abundance of oil producing nations in the region.
Number of factors driving and restraining the market
The factors that drive growth in the fuel additives market include stringent environmental regulations, depleting crude reserves, and demand for clean and efficient fuel. The factors that are providing hindrance in the growth of this market are rise in demand of alternate fuels, stagnant demand for high end gasoline, and huge investment in R&D for fuel additives.
Price: More important issue than quality in the emerging markets for fuel additives
Additives when added to any fuel provide economies of scale in the long run, but in the shorter run, these escalate the overall cost of the product, that is gasoline, diesel, and others. In price sensitive markets such as India and other developing economies where fuel price is a more vital issue than product quality, there is less market opportunity for premium fuels. In those countries product/fuel quality may or may not help in the sales of the fuel. Therefore, in these markets, adding the fuel additives to the fuel only adds the burden on the seller and the buyer, and both parties tend to lose. The price sensitive nature of these markets makes them less attractive and the sales of fuel additives is hampered and rather below potential here.
Fuel Additives Market by Applications (Diesel, Gasoline & Aviation), Types (Deposit control, Antioxidant, Corrosion inhibitor, Lubricity & Cetane improvers and others) - Global Trends & Forecast to 2019
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