Diesel Exhaust Fluid Market Trends

Global Diesel Exhaust Fluid (AdBlue) Market Overview

Diesel Exhaust Fluid (AdBlue) Market Size was valued USD 15,757.27 million in 2020. The Diesel Exhaust Fluid (AdBlue) Market industry is projected to grow from USD 15,757.27 million in 2020 to USD 35,316.55 million by 2030, exhibiting a compound annual growth rate CAGR of 8.57% during the forecast period (2021–2030). Diesel exhaust fluid (DEF) is a liquid used to reduce air pollution caused due to diesel engines. It is also known by the names AUS 32 and ARLA 32 and marketed as AdBlue. The DEF or AdBlue is an aqueous urea solution made with 32.5% urea and 67.5% deionized water. To meet stringent NOx emission standards beginning in 2010 for commercial truck engines and beginning in 2014 for most off-road engines, most engine makers have installed an embedded selective catalytic reduction (SCR) technology in the diesel vehicles, which requires DEF to operate. AdBlue is filled in a separate tank in vehicles with SCR technology. DEF is injected in the selective catalytic reduction (SCR) system, where it is heated in the exhaust stream and decomposes into ammonia and CO₂. When the NOx from the engine exhaust stream reacts inside the catalyst with the ammonia, the harmful NOx molecules in the exhaust stream are converted to harmless nitrogen and water, which are then released from the vehicle's tailpipe. Typically, a diesel engine requires about 3% DEF of the fuel.

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

Diesel Exhaust Fluid (AdBlue) Market Trends

GROWING ADOPTION OF DIESEL EXHAUST FLUID (ADBLUE) DUE TO GLOBAL EMISSION REDUCTION NORMS

Greenhouse gases (GHGs) trapped in the atmosphere cause gradual heating and affect the ozone layer, which protects the planet from harmful rays emitted by the sun. The major GHGs are carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), and fluorinated gases (hydrofluorocarbons, perfluorocarbons, sulfur hexafluoride, and nitrogen trifluoride). The burning of fossil fuels such as coal, natural gas, and oil, particularly from the transportation sector, results in the emission of CO2. According to the World Health Organization, around 4.2 million premature deaths globally are reported due to outdoor air pollution—black carbon (BC) being the major contributor. According to the US Environmental Protection Agency (EPA), in 2017, greenhouse gases (GHGs) released by the transportation sector were 29% of the global emissions. The high emission of GHGs has resulted in imposition of norms by several organizations pertaining to exhaust emission. According to the data provided by the European Union (EU), the consumption of energy is highest in the roadways segment—stands to 82%—while 18% is in the aviation, rail, pipeline transport, and non-specific transport segments. Thus, vehicular emissions highly contribute to GHG emissions. Various regulations have been implemented by governments to limit these emissions. For instance, the stages and legal framework for exhaust emissions of new vehicles sold in the European Union and EEA member states are Euro 1, Euro 2, Euro 3, Euro 4, Euro 5, and Euro 6 for light-duty vehicles and Euro I, Euro II, Euro III, Euro IV, Euro V, and Euro VI for heavy-duty vehicles. As per EU directive: Euro 1 – for passenger cars—91/441/EEC and for passenger cars and light trucks—93/59/EEC; Euro 2 – for passenger cars—94/12/EC (& 96/69/EC) and for motorcycle—2002/51/EC (row A)—2006/120/EC; Euro 3 – for any vehicle—98/69/EC and For motorcycle—2002/51/EC (row B)—2006/120/EC; Euro 4 – for any vehicle—98/69/EC (& 2002/80/EC); Euro 5 – for light passenger and commercial vehicles—715/2007/EC; and Euro 6 – for light passenger and commercial vehicles—459/2012/EC and 2016/646/EU. The European emission standards are also made for large good vehicles and older ECE R49 cycle vehicles. Like the European standards, the US EPA and the California Air Resources Board have implemented their own regulations regarding GHG emissions across the California Air Resources Board (CARB) states, which include Connecticut, Delaware, Maine, Maryland, Massachusetts, New Jersey, New Mexico, New York, Oregon, Pennsylvania, Rhode Island, Vermont, Washington state, and Washington D.C. The EPA, however, adopted the Californian emissions standards in the 2016 model as a national standard while collaborating with the California Air Resources Board on stricter national emissions standards for the 2017–2028 model years. The emission standards for lightweight vehicles are defined in the Clean Air Act Amendment of 1990, which strictly restricts the emission of oxides of nitrogen (NOx), carbon monoxide (CO), particulate matter (PM), non-methane organic gases (NMOG), non-methane hydrocarbons (NMHC), and formaldehyde (HCHO). In 2007, the US EPA banned gasoline models and only diesel models of heavy vehicles were allowed. Moreover, the energy consumption by the road sector transport has allowed the EU to impose high-level EU regulations for passenger cars and LCV. Some are as follows:

• The European CO2 emissions target for 2020/2021 was defined in 2014 as Regulation (EU) No 333/2014 for passenger cars and Regulation EU 253/2014 for LCV. The regulations foresee for passenger cars a phase-in of the 95 gCO2/km target based on the New European Driving Cycle (NEDC) test procedure during the years 2020 and 2021 allowing to discard the 5% most emitting vehicles during the first year. For LCV the target of 147 gCO2/km is defined for 2020.


• The CO2 emissions measured using the Worldwide Harmonized Light Vehicles Test Procedure (WLTP) must be converted to an New European Driving Cycle (NEDC) basis until 2020 to be compared to the CO2 emission target values defined for the NEDC (130 gCO2/km until 2019 and 95 gCO2/km starting 2020). Based on this correlation method and the actual fleet performance in 2020, OEM specific WLTP based CO2 targets will be defined for the period starting 2021.


• The CO2 emission targets for 2028 and 2030 were voted by the European council and parliament. CO2 reduction target for 2028 is -15% compared to 2021 for passenger cars and LCV. For 2030 the targets compared to the 2021 baseline are -37.5% for passenger cars and -31% for LCV

On the other hand, in the US, Under Section 177 of the Clean Air Act, the states either must follow the federal regulations or adopt California emission standards. Several states that needed stringent emission standards than the federal regulations to meet the air quality targets have adopted the California standards. The most recent adoption of California standards was by Colorado under the legislation of Executive Order B 2018 006 in the year 2018. Thus, the high consumption of energy results in GHGs emission and the imposition of norms have influenced the manufacturers of automobiles to adopt AdBlue in the fuel system, which helps to lower carbon emission. The AdBlue solution which consist of 32.5% of high-purity, synthetically manufactured urea in de-mineralized water is used to reduce harmful gases such as NOx, hydrocarbons, and carbon monoxide (CO), which are being released in the atmosphere. The AdBlue is known as ARLA32 in Brazil, diesel exhaust fluid (DEF) in the US, and AdBlue in Europe. Furthermore, various programs are conducted in partnerships with countries and manufacturing companies with an intent to lower GHG emissions. For instance, the US EPA had introduced voluntary partnership programs in 2000, which in 2017 saved USD 37 billion and avoided emissions of 433 million tons of carbon dioxide. This program consisted of 40% of the Fortune 500 companies. The Climate and Clean Air Coalition (CCAC) is another coalition between 68 countries, 76 non-state partners, 58 non-governmental organizations (NGOs), and over 125 private sector entities. The CCAC focuses on the rapid reduction of diesel black carbon emissions, which proposed a strategy by the CCAC Scientific Advisory Panel (SAP), in 2016. The proposal intended to reduce near-term climate warming by an average of 0.5°C over 25 years. To achieve this target, the emission of black carbon from all sectors must fall to 75% below 2010 levels by 2030. The Heavy-Duty Vehicles (HDV) Initiative of the CCAC released its global strategy in 2016 with the aim of all countries to implement the vehicle emission and fuel quality requirements equivalent to Euro 4/IV by 2028 and Euro 6/VI by 2030. These collaborations between companies and countries will help to low the carbon emission content at a faster rate, which is expected to increase the adoption of diesel exhaust fluid and drive the growth of the global market during the review period.

INCREASING USE OF ADBLUE IN HEAVY-DUTY VEHICLES

Diesel on-road engines play a vital role in the transportation sector, but dependence on diesel-run engines and technologies has significantly affected the environment and consequently the human health. The global consumption of diesel has grown eightfold since the 1970s, which is majorly driven by the rapid growth of road freight activity and dieselization of light-weight vehicle fleets. Diesel accounts for more than 40% of global on-road energy consumption and is the principal fuel of about 90% of the heavy-duty trucks and for over 75% of buses, according to the International Energy Agency (IEA). The large presence of old diesel engines is a major concern, as according to the International Agency for Research on Cancer (IARC), the diesel exhaust is a Class 1 carcinogen for humans. Technological advancements have resulted in the setting of important technology and policy solutions to address diesel exhaust emissions. Some of the technologies include diesel particulate filter systems, selective catalytic reduction systems, a natural gas three-way catalyst, and NOx absorber. The selective catalytic reduction system reduces oxides of nitrogen (NOx) emissions and enhances the fuel economy. The selective catalytic system uses a chemical reductant such as urea which is known as diesel exhaust fluid (DEF) in the US and Canada, AUS 32 in India, and AdBlue in Europe. Thus, the increasing use of these technologies is expected to propel the growth of the global market during the forecast period. Transportation tailpipe emissions have resulted in adverse health effects to more than 1 trillion people across the globe. The on-road diesel vehicles and heavy-duty vehicles (HDVs) are the major contributors to exhaust emissions and GHGs. Heavy-duty vehicles accounted for more than 86% of on-road diesel NOx emissions and 78% of on-road diesel black carbon emissions. The Heavy-Duty Vehicles Initiative (HDVI) by the Climate and Clean Air Coalition (CCAC) aims to concentrate on providing clean fuel while obliging to the vehicle regulations and policies. This initiative concentrates on providing clean emission and better fuel for heavy vehicles across the globe. The adoption of policies and norms has helped to reduce diesel energy consumption and sulfur content. The Euro standards which are defined by the European Parliament have been controlling emissions of new vehicles. In 2005, the Euro 4 standard was introduced, which was implemented for all vehicles that weighed over 3.5 tons such as trucks, buses, and other heavy-duty vehicles. These standards have subsequently been updated over the years currently to Euro 6 standard, which is made mandatory for all the vehicles, including cars and other industrial and agricultural vehicles. For heavy vehicles, the Euro VI implies that the emission limits for nitrous oxides should not be more than 2.0 g, while previously Euro V regulation read the emission limits for nitrous oxides to 3.5 g. The Euro VI emissions regulations required a reduction limit to 77% of nitrogen oxide (NOx). Thus, the need to reduce GHG emissions has led to introduction of selective catalytic reduction (SCR) technology, which used in commercial and passenger vehicles with AdBlue as the reductant agent. AdBlue acts as a reducing agent used within the SCR system that converts the harmful nitrous oxide to innocuous nitrogen and water. Thus, these regulations in heavy diesel vehicles are expected to increase the use of selective catalytic reduction systems, which in turn is expected to increase the consumption of AdBlue as a reduction agent. Thus, the increase in the manufacturing of heavy-duty vehicles and stringent regulations are expected to fuel the demand for AdBlue and drive the growth of the market during the forecast period.

Diesel Exhaust Fluid (AdBlue) Market Insights:

Diesel Exhaust Fluid (AdBlue) Market by Storage Tank Insights

The Diesel Exhaust Fluid (AdBlue) Market segmentation, based on storage tank the market has been segmented as Bulk Storage, Dispensers, Tanks, Portable Containers, Others. The bulk storage solution was estimated to be valued at USD 6,440.08 million in 2020 and is estimated to reach USD 15,160.18 at the end of 2030, by the CAGR of 4.57%.

Diesel Exhaust Fluid (AdBlue) Market by Application

The Diesel Exhaust Fluid (AdBlue) Market segmentation, the market is broadly categorized into automotive, construction machinery, farm machinery, electronic generators, railway engines, and others. In terms of value, automotive application was estimated to be valued at USD 10,274.57 million in 2020 and is estimated to reach USD 24,550.30 at the end of 2030, by the highest CAGR of 9.27%. The robust growth of the automotive industry in Asia-Pacific, with China leading the production and sales in the region, is driving the growth of the segment in the region.

Global Diesel Exhaust Fluid (AdBlue) Regional Insights

Based on Region, the Diesel Exhaust Fluid (AdBlue) Market has been segmented based on region into North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa. The North America market held the largest share of 57.52% in 2020 due to stringent regulations in the region and automobile and agricultural machinery manufacturers abiding by these regulations, which is expected to increase the consumption of diesel exhaust fluid (AdBlue). The market was valued at USD 9,063.32 million in 2020 and is expected to exhibit a CAGR of 8.42% to reach USD 20,023.98 million by the end of 2030.

Diesel Exhaust Fluid (AdBlue) Market Key Market Players & Competitive Insights

The Diesel Exhaust Fluid (AdBlue) Market is characterized by the presence of many global, regional, and local vendors. The market is highly competitive, with all the players competing to gain maximum market share. Rapid advancements in catalytic technology, frequent changes in government regulations, and growing application of AdBlue in the automotive industry, agricultural machinery, diesel-powered heavy industrial machinery, and others are the key factors increasing the demand for the product. The vendors compete based on cost, product quality, and brand name. It is crucial for the vendors to offer cost-effective and high-quality AdBlue to compete in the Asian market. The growth of market players is dependent on market conditions, government regulations, and industry development. Thus, the players should focus on expanding the production capacity to meet the demand and enhance their services. BASF SE (Germany), Yara (Norway), Mitsui Chemicals Inc (Japan), BP p.l.c (UK), Borealis AG (Austria), Nissan Chemical Corporation (Japan), GreenChem (Netherlands), NOVAX Material & Technology Inc (China), Royal Dutch Shell PLC (Netherlands), and Adeco doo (Siberia) are the major companies operating in the market that compete in terms of quality and price. These players are primarily focusing on the development of sophisticated and advanced mixes of AdBlue. Although the international players are dominating the market, the regional and local players with small market shares also have a moderate presence. The high competition among the players and easy manufacturing process have encouraged the players to produce AdBlue even on a small scale if they abide by the specifications provided by the German Association of the Automotive Industry (VDA). Various technologies and processes are used by different automobile manufacturing companies that require AdBlue. The players operating in the Asia-Pacific market are adopting various strategies to maintain their position and increase their regional presence. Some players are planning to invest and expand in the coming years.

BASF SE: BASF SE (BASF) is one of the largest chemical producers in the world. The company operates it business through five segments—chemicals, performance products, functional materials and solutions, agricultural solutions, and others. However, as of January 2019, the company has divided its business segments into six divisions, namely, materials, industrial solutions, chemicals, surface technologies, agricultural solutions, and nutrition & care. The company's product portfolio offers diesel exhaust fluid under the intermediate’s subdivision of the chemicals segment. The company operates through 12 divisions that manage 54 global and regional business units and develop strategies for 86 strategic businesses. BASF marks its presence in 80 countries and operates through six Verbund sites, which interlink the working of production plants, energy flows, and infrastructure in different regions. BASF primarily operates in Europe and has an active presence in the Americas, Asia-Pacific, and the Middle East & Africa

Yara: Yara is the world's leading fertilizer company and a provider of environmental solutions. The company operates through various segments, namely, crop nutrition, industrial, and production. Under the industrial segment, it offers AdBlue solutions for trucks, vans, cars, and farm vehicles. Yara has a production capacity of 2.8 MT of AdBlue per year. Yara has a network of five AdBlue production plants across the globe, namely in Sluiskil, Netherlands; Le Havre, France; Belle Plaine, Canada; Ferrara, Italy; and Brunsbüttel, Germany. Yara is listed on the Oslo Stock Exchange. It has production sites in six continents, market operations in more than 60 countries, and sales operations in about 160 countries globally.

Diesel Exhaust Fluid (AdBlue) Market Industry Developments

February 2018: Yara has set up the world's largest facility for the production of AdBlue in Brunsbüttel, Germany, with an annual production capacity of 1.1 million tons. The production facility includes a new deep-sea ship loading facility, a 17,500 m3 AdBlue tank, and a fully automated truck loading station operating 24/7 with a digitalized unmanned gate

Diesel Exhaust Fluid (AdBlue) Market include.

• BASF SE


• Yara


• Mitsui Chemicals INC


• BP PLC


• Borealis AG


• Nissan Chemical Corporation


• GreenChem


• NOVAX Material & Technology Inc


• Royal Dutch Shell PLC


• Adeco doo

Diesel Exhaust Fluid (AdBlue) Market Segmentation:

Diesel Exhaust Fluid (AdBlue) Market Storage Solution Outlook

• Bulk Storage


• Dispensers


• Tanks


• Portable Containers


• Others

Diesel Exhaust Fluid (AdBlue) Market Application Outlook

• Automotive


• Construction Machinery


• Farm Machinery


• Electronic Generators


• Railway Engines Others

Diesel Exhaust Fluid (AdBlue) Market Regional Outlook

• North America
  
  
  
  • US
  
  
  • Canada
  
  
  • Mexico
  
  
  
  


• Europe
  
  
  
  • Germany
  
  
  • France
  
  
  • UK
  
  
  • Spain
  
  
  • Italy
  
  
  • Russia
  
  
  • Rest of Europe
  
  
  
  


• Asia-Pacific
  
  
  
  • China
  
  
  • India
  
  
  • Japan
  
  
  • South Korea
  
  
  • Rest of Asia-Pacific
  
  
  • Middle East & Africa
  
  
  • South Africa
  
  
  • GCC Countries
  
  
  • Rest of the Middle East & Africa
  
  
  
  


• South America
  
  
  
  • Brazil
  
  
  • Argentina
  
  
  • Rest of South America