[Market Dynamics] The Future Development Trend Of Lubricating Oil Packaging Industry
Market research can help companies understand the secrets of success and problems in their industry so that they can glimpse the future and make better decisions. Greif, an industrial packaging expert, has made a survey that helps to understand the potential growth areas of the lubricant industry and shape packaging trends.
In the six months before the COVID-19 outbreak, Greif did a comprehensive market assessment: Customer research, online market research, analysis of sales, consulting with influential experts in the lubricants market, one-on-one interviews with a sample of 25 customers worldwide, including some of the world's leading lubricants manufacturers and suppliers. The study aims to explore future trends in the lubricants industry and assess their impact on the packaging industry, especially industrial packaging.
According to Grand Market Research, lubricants demand is projected to grow in all four major segments (automotive, industrial, Marine and aerospace). The overall lubricants market is expected to grow at a cagR of 2.9% through 2027. In terms of the lubricants packaging market, the automotive sector is expected to grow at 3.1 per cent, the industrial sector at 3.5 per cent, Marine at 3.8 per cent and aviation at 4.6 per cent over the same period.
However, in less than six months, due to COVID-19 and other reasons, industrial packaging and lubricants companies are implementing resilience strategies and reallocating resources based on the new, highly dynamic operating conditions they face. Greif's research provides insight into long-term trends. For example, new technologies, services or production, complemented by stronger environmental credentials, may be needed to help create differentiation in response to a broader market recovery.
Sustainability tops the list
Greif's research shows a growing concern for sustainability in the lubricants industry. The importance of sustainability was mentioned by 90% of Greif respondents and confirmed by the key strategies of the top companies in the industry. This may reflect a growing industry-wide commitment to decarbonisation and circular economy business models.
Despite the environmental policy varies between countries and regions, but combined with the principle of circular economy development is becoming more and more common, this is from October 2018 to promote the sustainable development of the world business council published a briefing proved, it provides about circular economy policies implemented by the European Union and China have the increasing number of information.
In addition, the European Green Deal, announced in December 2019, covers all sectors of the economy and sets out proposals to help Europe become the first climate-neutral continent by 2050.
Greif's research also shows that consumers have more and more purchasing power, and the fact that sustainability certificates are now a core part of today's consumer buying decisions. They promote the use of more biodegradable and clean lubricants and raise awareness of the "harmful impact of industrial waste on the environment", which is one of the reasons why there is a growing need for more environmentally friendly packaging and sustainable strategies.
In April 2020, Shell became the latest global energy company to commit to a net zero emissions target by 2050. Other leading lubricants producers, including Total, ExxonMobil, Chevron and BP, have made similar commitments.
Aysu Katun, Director of sustainability at Greif, commented on the importance of packaging: "Before many companies even consider adding packaging to their supply chain networks, the packaging businesses involved need to have a strong sustainability plan in place, including being able to demonstrate their willingness to take steps to develop a zero-waste landfill business and increase incentives for recycling systems."
"That said, there is not a global consensus on this. Waste schemes in Europe, for example, are usually supported by strong regulatory frameworks there. But customers in other regions, such as North America, tend to have fewer environmental regulations than in Europe." Katun observed.
These are where sustainability relates to other priorities. Based in Philadelphia, Pennsylvania, Peggy o · Richards, the company's chief operating officer David Richards (David Richards,) said: "although sustainability has always been the focus of global companies and consumers, but smaller manufacturers again, all kinds of terminal market to have a higher cost performance and durable packaging requirements".
"Recycling and refurbishment programs vary by state, not to mention many international markets," he said. We rely on packaging suppliers to help us meet the needs of our growing customer base in all markets, including better access to recycling, reuse and disposal."
Greif's research also illustrates how customers in the lubricants industry are actively seeking to reduce the amount of raw materials used in packaging, for example by using lower specification steel drums. There is also a desire to see more packaging (including recycled plastic) and a drive for recycling and refurbishment.
"We try to minimize the impact of packaging on the environment. But there are trade-offs between the different SDGS." Katun continues. "For example, refurbishment can save the most exhaust gas, up to 75 percent or more depending on the product. On the other hand, thinning measures (depending on the degree) may limit the refurbishment of steel drums. When using plastic packaging, residual lubricants are difficult to remove, making recycling and repair difficult. So we need to grind, clean and remove the plastic."
"The challenge for the lubricants industry and for us as industrial packaging suppliers is always to find the right balance. In implementing the sustainable development strategy, we must ensure the quality and safety of packaging. Strong collaboration between customers and suppliers on this issue is the only way to develop true sustainable value." She said.
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