China's base oil and lubricants market demand both showed a negative growth in the past 5 years, with base oil demand growing at a compound annual growth rate (CAGR) of -3.15% and lubricants at -1.4% by 2023, according to data from OilChem.
The total production of all base oil types, including Group I base oil, Group II base oil, Group III base oil, naphthenic rubber process oil, white oil, and recycled lubricating oil, reached 7.54 million tonnes in 2023, an increase of 0.23% year-on-year (YoY). The total production capacity stood at 23.65 million t/y, up 1% YoY, and the capacity utilization rate was about 32%, as many base oil units remained shutdown in 2023. The apparent consumption was 8.95 million tonnes, a decrease of 2.18% YoY, data from OilChem showed.
2023 China Base Oil Production (by type)
Source: OilChem
The total lubricants production is expected at 6.6 million tonnes in 2023, an increase of 0.16% YoY. According to OilChem's survey on lubricants factories, the industrial lubricants production experienced a rapid decline in 2023, which were greatly affected by the domestic economic environment, while the production of automotive lubricants increased, mainly bolstered by fuel vehicle ownership. The total demand for lubricants in China is estimated to have reached 6.7 million tonnes in 2023.
2021-2023 China Lubricants Production (by month)
Source: OilChem
The production of Group II base oil in 2023 was 3.34 million tonnes, a decrease of 0.42% YoY. This was because 17 Group II base oil factories underwent maintenance in 2023, resulting in a total maintenance loss of 649,400 tonnes. Each maintenance lasted for 36 days on average, and for some units, it even reached 6 months.
2023 China Group II Base Oil Production (by type)
Source: OilChem
Separately, the production of 150N was the largest among all Group II base oil, accounting for 34% of the total Group II paraffinic base oil production, followed by 60N, accounting for 31%, and then 350N and 500N, each accounting for 12%.
2023 China Group II Base Oil Production Proportion (by types)
Source: OilChem
Written by Sunny Fang, fss@oilchem.net
Edited by Aggie Hu, huchenying@mysteel.com
