Agricultural Lubricant Market

Updated on : April 15, 2024

Agricultural Lubricant Market

The global agricultural lubricant market was valued at USD 6.3 billion in 2023 and is projected to reach USD 7.7 billion by 2028, growing at 3.9% cagr from 2023 to 2028. Industrial and agricultural sectors are driving the growth in agricultural lubricant market The industrial application of agricultural lubricants, particularly engine oils, is essential for maintaining the performance and longevity of heavy-duty farming machinery. Agricultural lubricants offer several benefits in the agriculture sector, including increased equipment reliability, increased yield and higher profits and reduced maintenance costs,. These benefits make agricultural lubricants an essential component in maintaining the smooth and efficient functioning of agricultural machinery, ensuring operational reliability, and increasing equipment uptime, regardless of the weather conditions or terrain.

Attractive Opportunities in the Agricultural Lubricant Market

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Agricultural Lubricant Market Dynamics

Driver: increasing mechanization in agriculture

The growing adoption of advanced farming techniques and equipment is driving the demand for lubricants to maintain and operate agricultural machinery efficiently. As the agricultural sector continues to evolve and embrace mechanization, the demand for high-performance lubricants, including engine oils, is expected to rise. The increasing sophistication of farming equipment has resulted in a significant rise in the demand for these lubricants. The robust growth of the agricultural sector, coupled with the rising adoption of advanced farming machinery, is expected to play a key role in driving the demand for agricultural lubricants, particularly engine oils. These oils are designed to endure the harsh circumstances of agricultural work, such as exposure to dust, debris, and large loads, and are vital for ensuring engines' longevity and smooth operation by reducing dissipating heat, and preventing wear and tear. The agricultural lubricant market is likely to be significantly influenced by the growing preference for lubricant in the mentioned earlier and other industries.

Restraints:Volatile crude oil prices

Volatile crude oil prices is one of the major restraint for the agricultural lubricant market due to the close connection between the crude oil market and production of lubricants. Variations in crude oil prices have a notable and immediate effect on production expenses, which include the processing ,extraction, and refinement of base oils used in the manufacturing of lubricants.As a result, the agricultural lubricant market may experience fluctuations in valuation and growth , depending on the volatility of crude oil prices These factors will hamper the development of the agricultural lubricant market.

Opportunity:Rising demand of bio-based lubricant

The increasing demand for bio-based lubricants presents a significant opportunity for the agricultural lubricant market. As there is a growing awareness and emphasis on sustainable and environmentally friendly practices, bio-based lubricants align with these trends. Agriculture is an industry where environmental considerations are increasingly important, and bio-based lubricants offer several advantages: environmental sustainability, biodegradability and reduced carbon footprint.Due to which their demand is expected to increase, and this further gives an opportunity to the development of the agricultural lubricant market.

Challenge: emergence of electric tractor

The emergence of e-tractors is a challenge for the agricultural lubricant market. E-tractors are electric-powered tractors that are becoming increasingly popular in the agricultural sector due to their environmental benefits and cost-effectiveness.As e-tractors do not require traditional lubricants, the demand for agricultural lubricants may decrease, which could negatively impact the market Therefore, the emergence of electric tractors  in is anticipated to pose a challenge to the expansion of the agricultural lubricant market.

Agricultural Lubricant Market Ecosystem

Prominent companies in this market include well-established, and financially stable manufacturers of agricultural lubricant market. These companies have been operating in the market for several years and possess a diversified product portfolio and strong global sales and marketing networks. Prominent companies in this market include Shell PLC (UK), Exxon Mobil Corporation (US),Total Energies (France),BP p.l.c (UK) ,Chevron Corporation (US).

"UTTO, by category, is estimated to account for the highest CAGR during the forecast period."

In the Agricultural Lubricants Market, UTTO emerge as the highest CAGR, propelled by several pivotal factors. Agricultural machinery, characterized by intricate gear systems and transmissions, demands high-performance lubricants to ensure optimal functionality and longevity. Stringent regulations emphasizing environmental sustainability have spurred technological advancements in lubricant formulations, enhancing their efficiency and reducing environmental impact. As farmers and agricultural enterprises prioritize equipment reliability and efficiency, the demand for specialized UTTO lubricants has seen a substantial increase. This dominance underscores the critical role these lubricants play in enhancing the overall performance and lifespan of agricultural machinery, positioning UTTO lubricants as the cornerstone of the Agricultural Lubricants Market

"Aftermarket, by Sales Channel, is estimated to account for the highest CAGR during the forecast period."

The aftermarket segment leads the agricultural lubricant market due to its offline distribution channels. This dominance is fueled by the rising demand for lubricants crucial for farm machinery and the preference for cost-effective and versatile mineral oil-based lubricants. Government initiatives and investments supporting the agricultural sector contribute to this segment's prominence. In essence, the aftermarket's success is driven by distribution channels, demand, lubricant types, and governmental measures

"Bio-Based Lubricant, by product type, is estimated to account for the highest CAGR during the forecast period."

Bio-Based Lubricant is accounted as the highest CAGR, signifying their enduring significance. This growth can be attributed to their excellent lubrication, effectively reducing friction and wear on machinery components. Additionally, their low friction coefficients contribute to enhanced efficiency in farming machinery. With a low evaporation rate, bio-based lubricants ensure consistent lubrication, minimizing the need for frequent top-ups. Moreover, evolving agricultural practices and equipment innovations necessitate agricultural lubricants that provide robust protection and operational reliability, further contributing to the sustained growth of Bio-Based Lubricant in the Agricultural Lubricants Market.

"Asia Pacific is estimated to account for the highest CAGR during the forecast period."

The Asia Pacific region leads in agricultural lubricant market growth due to factors like high food demand, substantial agricultural sectors in countries like China and India, government initiatives, and the adoption of modern farming techniques. The region's large population, with over half relying on agriculture, further drives the demand for efficient lubricants.

Source: Secondary Research, Expert Interviews, and MarketsandMarkets Analysis

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Agricultural Lubricant Market Players

Major companies in the agricultural lubricant market include include Shell PLC (UK), Exxon Mobil Corporation (US),Total Energies (France),BP p.l.c (UK) ,Chevron Corporation (US) and others. A total of 29 major players have been covered. These players have adopted product launches, agreements, joint ventures, investments, acquisitions, mergers, and expansions as the major strategies to consolidate their position in the market.

Read More: Agricultural Lubricant Companies

Agricultural Lubricant Market Report Scope

This research report categorizes the agriculture lubricant market based on Product Type, Category Type, Sales Channel Type, Farm Equipment type, and Region.

Based on Product Type, the agriculture lubricant market has been segmented as follows:

• Engine oil
• UTTO (transmission &  hydraulic oil)
• Coolant
• Grease

Based on Category Type, the agriculture lubricant market has been segmented as follows:

• Mineral oil-based lubricants
• Synthetic oil-based lubricants
• Bio oil-based lubricants

Based on Sales Channel, the agriculture lubricant market has been segmented as follows:

• Aftermarket
• OEM’s

Based on Farm Eqipment, the agriculture lubricant market has been segmented as follows:

• Tractors
• Combines
• Implements

Based on Region, the agriculture lubricant market has been segmented as follows:

• Asia Pacific
• Europe
• North America
• Middle East & Africa
• South America

Recent Developments

• In Nov 2022, Shell expanded its Marunda Lubricants Oil Blending Plant (LOBP) in Bekasi, Indonesia to meet the growing demand for premium lubricant products in Indonesia.
• In March 2023, ExxonMobil plans to build a lubricant manufacturing plant in India, which will be the company's  first greenfield investment in the country.
• In January 2024, Sinopec and BP have signed a Memorandum of Understanding (MoU) to strengthen cooperation in various areas, including fuel retailing, oil and gas trading, lubricant and marine fuel sales, and upstream activities.

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