By OGJ editors
HOUSTON, Dec. 1 -- The US market for gasoline and other fuel additives is expected to increase 2.3%/year for 5 years—to $8.4 billion in 2008 from $7.5 billion in 2003, said Freedonia Group Inc., Cleveland, Ohio.
Federal and state legislation continues to shape the long-term outlook for fuel additives, Freedonia said in a recently released report, "Gasoline & Other Fuel Additives." Also driving the fuel additives market are the fuel performance needs of increasingly complex combustion engines, the market researcher said.
Fuel-grade ethanol consumption is forecast to reach 4.1 billion gal in 2008. Methyl tertiary butyl ether (MTBE) increasingly is being replaced by ethanol, which is blended into gasoline at lower concentrations than MTBE, the report noted.
The ethanol market value is forecast to grow at 9.7%/year to $5.7 billion in 2008. The MTBE market will decline at 15.5%/year to $1.28 billion in 2008. The MTBE market value in 2003 was $2.98 billion.
Biodiesel, benefiting from the renewable fuels standard, is expected to become the fastest growing fuel additive, Freedonia said.
The biodiesel market is expected to grow at 32%/year to $240 million from $60 million in 2003. Meanwhile, the specialty fuel additives market is projected to climb more than 6%/year to $1.1 billion in 2008.
Gasoline is expected to continue to be the dominant market for fuel additives, accounting for more than 90% of additive value in 2008.
"However, diesel fuel will continue to be the fastest growing market, primarily due to the expanding use of biodiesel and favorable demand for additives that restore fuel characteristics lost in the refining of low sulfur diesel fuels," Freedonia said.