Specialty Fuel Additives Demand to Reach $1.3 Billion in 2012

US demand for specialty additives used in gasoline and other fuels is forecast to increase 2.9 percent per year to $1.3 billion in 2012.  Above average growth for deposit control agents -- the largest segment of fuel additives -- will continue to support the market. Corrosion inhibitors and additives used in diesel fuel such as cold flow improvers will show the fastest growth.  The long-term outlook for fuel additives will continue to be shaped by government legislation at both the federal and state levels, along with the greater fuel performance needs of newer engines. These and other trends, including market share and product segmentation, are presented in Specialty Fuel Additives, a new study from The Freedonia Group, Inc., a Cleveland-based industry research firm.

Deposit control agents are expected to reach 371 million pounds in 2012, valued at $441 million.  Growth is expected to slow from the 9.1 percent per year experienced in value gains from 2002 to 2007.            Lubricity improver demand will rise at an above average pace of 3.5 percent per year from 2007 to 2012, much slower than the 16.4 percent annual growth seen from 2002 to 2007.

Environmentally-driven legislation, particularly for diesel fuel, is expected to continue to spur demand for additives capable of maintaining the performance characteristics of clean fuels.  Regulations will particularly boost demand for cold flow improvers, which are necessary to increase the performance of ULSD and biodiesel in colder climates.  Corrosion inhibitors are also expected to show above average growth through 2012 as these additives are needed to counteract the effects of higher oxygenate levels in fuel.

Fuel blenders and terminals will continue to carry out the majority of additizing.  Refiners will account for much of the rest with the aftermarket comprising the smallest portion.  Top Tier Detergent Gasoline standards are increasing the amount of deposit control added by gasoline blenders.  In addition, growing ULSD production will increase use of lubricity improvers by storage terminals due to problems with contamination in pipelines.  Minimum requirements for gasoline deposit control additives will continue to be met by the refinery.  Deposit control additives will continue to comprise the bulk of the aftermarket, with lubricity and cold flow improvers seeing increased use by owners of diesel-powered vehicles.

The Freedonia Group is a leading international business research company, founded in 1985, that publishes more than 100 industry research studies annually. This industry analysis provides an unbiased outlook and a reliable assessment of an industry and includes product segmentation and demand forecasts, industry trends, demand history, threats and opportunities, competitive strategies, market share determinations and company profiles.