Many Middle East countries are pouring billions of dollars into infrastructure and industries to diversify their economies. Manufacturing accounts for a growing share both of the regions economic output and its exports, and that means the regions appetite for industrial lubricants is growing.
Mehrdad Vajedi, Middle East sales manager for Nynas AB, offered some tantalizing tidbits about industrial growth in the region at the ICIS Middle Eastern Base Oils & Lubricants Conference in Dubai in October. He went so far as to dub it an untapped market. Could there really be such a thing in our industry?!
Finished lube demand in the Middle East totals 1.7 million tons per year, of which about 440,000 tons is industrial lubes. The largest country markets are Iran, Saudi Arabia, Iraq, Syria and the United Arab Emirates. Despite some challenges – including lack of formulation expertise, blending capability and OEM ties – the regions advantages outweigh the negatives, Vajedi said.
He highlighted some of the growing lube-intensive industries. The steel industry, especially in Iran and Saudi Arabia, is hungry for hydraulic fluids, metalworking fluids, rolling oils, gear oils, greases and other industrial lubes. Gulf Cooperation Council members produce 7 percent of the worlds primary aluminum, and demand is growing for auto and solar industries. More than 130 cement plants are located throughout the Middle East, eager to consume industrial engine oils, hydraulic fluids and other lubes.
Auto manufacturers in the region produce 1.5 million units a year, mainly in Iran, and auto plants are on the drawing board in Bahrain, Syria, Saudi Arabia and U.A.E. In addition, the GCC is already home to 300 parts manufacturing plants, all in need of industrial lubrication.
Textiles, petrochemicals, power plants, mining… the list of the Middle Easts lube-consuming industries is growing, said Vajedi. The GCC plans to complete the first 2,200 kilometers of a rail network by 2017; think industrial oils, greases, locomotive engine oils. And last but not least, said Vajedi, over 45 billion is earmarked to build infrastructure in Qatar in preparation for the FIFA 2022 World Cup. All these projects will need a lot of industrial lubricants.
Tim Sullivan, Cardo Lianez, Gloria Steinberg Briskin and all our colleagues at LubesnGreases Europe-Middle East-Africa join me in wishing you a happy holiday season and a peaceful and prosperous New Year.
– Nancy J. DeMarco
nancy@LNGpublishing.com