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Industry Landscape丨The Metalworking Fluid Industry is Coming Up Roses

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Driven by strong government support, China's intelligent manufacturing industry has experienced a surge in growth, positioning itself as a leading force in the nation's manufacturing landscape. This rapid advancement has fueled the demand for high-performance metalworking fluids (MWFs), essential "co-pilots" in the production process. These silent yet critical partners play a crucial role in lubrication, cooling, rust prevention, and cleaning, ensuring smooth and efficient operations. With China's unwavering commitment to intelligent manufacturing, the future of MWFs in the region looks remarkably promising.


Current Situation

Emerging alongside the growth of industry, metalworking fluids (MWFs) have a long and vital history. As globalization fuels industrial development, the demand for MWFs has steadily increased. In 2022, global demand reached 1.772 million tonnes, and it's projected to rise further to 1.9 million tonnes by 2023.

The metalworking fluid (MWF) industry chain is mainly composed of upstream manufacturers of base oil, additives, corrosion inhibitors, and bactericides used in MWF production. In the middle, MWF manufacturing involves processes such as mixing, stirring, adjusting chemical formulations, and quality control. Manufacturers typically develop different types of MWF products based on market demand, performance requirements, and application areas. The downstream application areas of MWF mainly include the mechanical processing industry, including automotive manufacturing, aerospace, and metalworking.

Specifically, the downstream of China's MWF mainly includes the automotive, mechanical processing, metal products, and electrical and mechanical equipment industries. Among them, the automotive industry accounts for about 32.3%, the mechanical processing industry accounts for about 36.7%, the metal products industry accounts for about 10.6%, and the electrical and mechanical equipment industry accounts for about 9.0%. In recent years, the rapid development of China's high-end equipment manufacturing industries, such as automotive and construction machinery, has brought broad growth opportunities for the MWF industry.


Global Landscape

Currently, China is vigorously promoting the "dual carbon" goal of energy conservation and emission reduction. As an important application material in the mechanical processing industry, it is also an important aspect for metalworking fluids to implement the emission reduction goal in the development, use, maintenance, and treatment. Currently, metalworking fluids are still manufactured with petroleum products as the main raw materials, accounting for about 90% of the total.

However, petroleum products have poor biodegradability, and long-term retention in water and soil will seriously affect the growth of aquatic animals and plants, agricultural irrigation, and drinking water. Therefore, reducing the proportion of petroleum products in the main components of metalworking fluids is of some significance for reducing carbon emissions and promoting the low-carbon transformation of manufacturing. In recent years, the country has continued to promote the implementation of environmental protection and safety policies, which has made fine chemical enterprises that meet the requirements of energy conservation, environmental protection, and safe production more advantageous in market competition.

China is one of the largest manufacturing countries in the world. Various manufacturing industries, including automobiles, machinery, electronics, and aerospace, all need metalworking fluids to support their production processes. The future demand for metalworking fluids in the Chinese market will continue to grow. The market prospects for the Chinese metalworking fluids industry are still very promising. In the future, the Chinese metalworking fluids industry will continue to develop in a more environmentally friendly direction. In addition, as the manufacturing industry continues to develop, the demand for high-performance cutting fluids will also continue to increase.

From the perspective of industrial distribution, with the regional transfer of global industries, developing countries represented by China have taken over a large number of metal processing industries from developed countries. The market focus of the metalworking fluid industry has gradually shifted to developing countries. Combined with the development environment of the industry and market dynamics, it can be seen that China occupies an important position in the global metalworking fluid industry.


New Patch Waiting to Open

After years of technological accumulation and innovation, the metalworking fluid industry in China has made great progress overall. According to relevant industry data, the MWF market in China shows a clear regional distribution feature. The eastern, northern, and southern regions are the main demand areas for MWFs, with a large number of MWF production enterprises concentrated there. Foreign well-known brands also often establish distribution agencies or select distributors in these regions. Therefore, the MWF marketization degree in these regions is relatively high.

At the same time, the MWF industry in China is also facing a series of challenges. On the one hand, due to the overall technical level, there is still a gap between the product formulation, product quality, and additive production of China and developed countries. However, in recent years, some domestic MWF production enterprises have set higher requirements, deeply cultivated the market and users, improved their R&D capabilities, and constantly made technical breakthroughs in terms of technical concepts and product formulations in order to enhance their competitiveness. Their products are developing towards a wider application range and stronger quality and performance. They are expected to achieve a breakthrough in the MWF market where foreign brands are strong and create a new world.

On the other hand, with the increasing strictness of national environmental protection policy regulation, the MWF industry in China is actively exploring and promoting the path of environmental protection and sustainable development. According to the industry planning goals for the "14th Five-Year Plan", the MWF industry in China will undergo structural adjustment. Green design, the promotion of green processes and green products, and the reduction of resource consumption and environmental impact are already becoming a trend.

With continuous technological progress and increasing production, the MWF industry in China will continue to develop towards the direction of intelligence, greenness, high quality, and diversity, and jointly contribute to the sustainable development of China's industrial manufacturing. The future is promising, stay tuned!

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