The European Biolubes industry is set for expansion over the next five years, providing investors can overcome Europe's current economic issues.
The European market in bio-sourced lubricants could reach 240,000 tonnes within the next five years, according to the latest report by Global Industry Analysts. The research, “Biolubricants: A North American and European Market Report”, examines the biolubes industry, its drivers and trends and concludes that the industry is set for growth providing it can overcome Europe's current economic issues.
The report claims that Europe and North America are the driving forces for renewable energy sources, including lubricants produced from vegetable oil or synthetic esters made from modified renewal oils. With increasingly rigorous environmental regulations being implemented on both continents, the demand for biolubes will continue to grow.
However, the report also points out that with biofuel and lubes production in transition between development and commercial viability, there is a need for significant investment in the companies - many of the small or medium sized - which are driving research and blending technology. With Europe's economy far from stable, this could certainly hold back capital expenditure in the short term, although the report shows a longer-term positive outlook.
In the US, according to GIA, biolubes are likely to see a Compound Annual Growth Rate of just over seven percent to 2017. This growth is epitomised by products such as Yelo Velo's biolube which, although niche from a small manufacturer, is aimed at the burgeoning, environmentally friendly bicycle market.