Analysis of the Mining Lubricant Market in Australia - a new market research report on companiesandmarkets.com
PR-Inside.com: 2014-04-30 09:25:02
Growth in the Australian mining sector has created strong demand for lubricants used on mobile and static equipment. Mining investment recovered relatively quickly from the global financial crisis, with investment in equipment, plant and machinery growing between 2010 and 2012. Newly installed machinery and operating plants have a demand for larger quantities of lubricants to maintain a normal working order and ensure a longer life.
In general, mining technologies in Australia are advanced as per the world standards with significant use of heavy machinery. Heavy duty machinery requires high performance lubricants that can withstand high temperature and pressure. The prices of lubricants are largely influenced by the global crude oil price movements. However, increased competition adds to downward price pressure.
Biodegradable products are gaining customer attention, but only at a very slow rate. In the short-to-medium term, mineral oil-based products are expected to continue dominating the market. The global slowdown in demand for mineral resources is expected to lead to slower mining sector investment, hence a slower growth in lubricants over the forecast period.
Direct sales is the main channel to the market. However, distributors are often used by smaller suppliers or new market participants. The market is concentrated, dominated by five leading suppliers. The global industrial lubricants leader BP is also the largest supplier in the Australian mining lubricant market. Three tiers of competition exist in the market: leading international oil companies, specialised lubricant suppliers and new market suppliers targeting small-to-medium customers and supply shortfall situations.
The challenges of penetrating the Australian market include the presence of highly entrenched market leaders and the difficulty in persuading customers to switch products. Owning the necessary product certification is insufficient for gaining customers´ confidence. Often a successful track record in overseas projects is recognised by customers. Return-on-investment is crucial for customers in choosing higher cost lubricant products.
The Australian mining lubricants market is expected to grow steadily. The reduced number of new mining projects limit business opportunities. Performance and return-on-investment are priorities for customers. Sustainability is becoming an increasingly valued concept among customers.Price increases are kept under check due to low cost suppliers entering the market.
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