The global Diesel Exhaust Fluid Market is estimated to be valued at US$ 11.60 Mn in 2023 and is expected to exhibit a CAGR of 7.67% over the forecast period from 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
Diesel exhaust fluid (DEF) is a non-toxic solution made from urea and deionized water. It is used in selective catalytic reduction (SCR) systems to reduce the harmful emissions produced by diesel engines. DEF helps convert nitrogen oxide (NOx) emissions into harmless nitrogen gas and water vapor. The increasing environmental regulations and stringent emission norms worldwide are driving the demand for DEF. Additionally, the advantages of using DEF, such as improved fuel efficiency and engine performance, make it a preferred choice among vehicle manufacturers and operators.
Market Key Trends:
One key trend in the Diesel Exhaust Fluid Market is the growing adoption of SCR technology. SCR systems have become increasingly popular in the automotive industry due to their ability to effectively reduce NOx emissions. These systems require DEF to function properly, driving the demand for DEF. The rising awareness about the environmental impact of diesel emissions and the need to comply with emission standards are fueling the adoption of SCR technology and, consequently, the demand for DEF. As a result, manufacturers of DEF, such as Yara International, BASF SE, and CF Industries Holdings Inc., are expected to witness significant growth in the coming years.
Porter's Analysis
· Threat of New Entrants: The threat of new entrants in the diesel exhaust fluid market is relatively low. The market already has established players and high entry barriers, such as the need for significant capital investment and adherence to strict regulations for manufacturing and distribution. This makes it difficult for new players to enter the market and compete effectively.
· Bargaining Power of Buyers: The bargaining power of buyers in the diesel exhaust fluid market is moderate. Although buyers have the option to choose from multiple suppliers, the standardized nature of the product and the wide availability of diesel exhaust fluid limits their bargaining power. Additionally, the increasing demand for diesel exhaust fluid for various applications gives suppliers more control over prices.
· Bargaining Power of Suppliers: The bargaining power of suppliers in the diesel exhaust fluid market is relatively high. The market is dominated by a few key players, giving them control over the supply chain. Suppliers can leverage their market dominance to negotiate favorable pricing and terms. Furthermore, the limited availability of certain raw materials used in the production of diesel exhaust fluid can increase the suppliers' bargaining power.
· Threat of New Substitutes: The threat of new substitutes in the diesel exhaust fluid market is low. Diesel exhaust fluid is essential for selective catalytic reduction (SCR) systems, which are widely used in diesel engines to reduce emissions. There are no equally effective alternatives to diesel exhaust fluid for this purpose, making it unlikely for substitutes to enter the market and replace the product.
· Competitive Rivalry: The competitive rivalry in the diesel exhaust fluid market is intense. The market is highly consolidated, with a few major players holding the majority of the market share. These companies compete based on factors such as product quality, pricing, distribution network, and technological advancements. The intense competition drives innovation and efficiency in the market.
Key Takeaways
The Global Diesel Exhaust Fluid Market Size is expected to witness high growth, exhibiting a CAGR of 7.67% over the forecast period. This growth can be attributed to the increasing implementation of strict emission standards by governments and regulatory authorities worldwide. As the demand for clean and emission-compliant diesel engines continues to rise, the need for diesel exhaust fluid for SCR systems increases.
The fastest-growing and dominating region in the diesel exhaust fluid market is North America. The region has a significant market share due to the presence of stringent emission standards and a well-established transportation sector. The United States, in particular, is a key market within North America, driven by the adoption of SCR systems in commercial vehicles and off-road machinery.
Key players operating in the diesel exhaust fluid market include Yara International, BASF SE, CF Industries Holdings Inc., Agrium Inc., Cummins Inc., Shell ROTELLA (Royal Dutch Shell Inc.), Mitsui Chemicals Inc., and KOST USA. These players have a strong market presence, extensive distribution networks, and a focus on product innovation to meet the increasing demand for diesel exhaust fluid globally. They are also actively involved in strategic partnerships and acquisitions to expand their market share and geographical reach.
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The demand within the global market for diesel exhaust fluid has been rising on account of several initiatives taken by the automotive sector to reduce harmful emissions from automobiles, finds Transparency Market Research (TMR).
The market players in the global diesel exhaust fluid market have been concentrating on improving the quality and performance of their product to gain a competitive edge over vendors.
The large market players in the global diesel exhaust fluid market are expected to acquire the small, redundant, and defunct vendors to expand their geographical reach.A vital strategy that is expected to be a key highlight of the competitive landscape of the global market for diesel exhaust fluid market is the establishment of strategic alliances between small and medium-sized vendors.
Hence, strategic partnerships, mergers, and acquisitions are projected to be the watchword of the global market for diesel exhaust fluid.The global market for diesel fluid exhaust is expected to expand at a healthy CAGR of 7.1% over the period between 2017 and 2022.
Furthermore, the total revenues accumulated by the global diesel exhaust fluid market in 2017 stood at US$10.4 bn in 2017, and this figure is projected to elevate to US$14.4 bn by 2022-end.
On the basis of pack type, the demand for bottled fluids has been rising across the globe; based on geography, the demand for diesel exhaust fluids is the highest in Europe.
