Lubricant Market Update
As many of you are aware, the cost of lubricants over the past 24 months has seen steady increases.
The substantial and steady spike in crude oil prices coupled with supply chain issues has caused all lubricant companies to pass on expense to the end users.
We have seen 20-30% increases or more, spread out over the last couple of years on engine oils, hydraulic oils and gear lubes. Semi synthetic and full synthetic oils have seen the most significant increase but all have been impacted drastically.
The latest line of lubricant products to feel the pain is grease. Last year about this time, Chemtool, a major chemical plant that produced grease caught fire and suffered severe damage. That has shown to be the first of many factors impacting the grease market. The Russian invasion of Ukraine and the sanctions and world supply issues that ongoing event has created have only added to the grease and lubricant volatility. Russia was a key supplier in the additive industry with their chemical components that make up the backbone of their additive chemistries. The sanctions that are in place due to the invasion are drastically impacting the lithium, calcium sulfonate and polyurea. Due to these factors, costs are expected to continue to increase, We may see monthly price increases in the grease market. Lead times on getting grease products are anywhere from 3-8 months depending on the products. In short, grease production is tight and not expected to see much relief for at least the balance of 2022 if not further.
As always MKC and Cenex Lubricants are committed to being your partner through these volatile times and getting you product in a timely manner. MKC and Cenex have consistently worked to have existing inventory for your needs and have stayed out front on issues like this to plan and react before they impact your operations.
Our current inventories are well stocked to meet your needs for all of this season and our big pictures efforts have us positioned to meet the demands for the coming seasons.
There are still many unknowns that may continue to impact the lubricants market despite the best of planning. Now is a great time to take advantage of current inventories and pricing by being sure you are stocked up on lubricants and especially grease. The cartridge grease products will be the hardest impacted as they are the most popular to use with poly based greases being the extreme of these. If you have not already been in contact with your area energy sales consultant, we encourage you to do so now or call into the energy office at 620-241-1885 so that together we can work to insure your current and future lubricant needs are meet.
Provided by: Rick Limon, director of energy sales