Diesel Exhaust Fluid Market Growth Accelerated by Sustainable Diesel Emission Regulations

 

Diesel exhaust fluid, also known as aqueous urea solution or DEF, is an essential fluid for selective catalytic reduction (SCR) system to lower NOx emissions from diesel engines. DEF improves air quality by converting over 90% of harmful nitrogen oxides in diesel exhaust into harmless nitrogen and water vapor through the SCR process. With increasingly stringent emission regulations to curb air pollution, the demand for DEF from on-road vehicles, construction equipment, trucks, buses, farm machinery, mining equipment etc. has increased substantially. 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 7.6% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market key trends:

Emission regulations have made DEF tanks mandatory for diesel vehicles and machines powered by diesel engines. Factors such as widespread availability of DEF, educational initiatives highlighting its environmental benefits and growing diesel vehicle parc have increased the acceptance of SCR technology globally. Automakers have successfully incorporated DEF tanks in their vehicle models without compromising performance or payload carrying capacity. As a consequence, the sales and production volumes of DEF have grown exponentially over the past decade and the trend is expected to continue further.

Segment Analysis

The global diesel exhaust fluid market is dominated by automotive OEM segment. This segment holds more than 45% share of the total market as diesel exhaust fluid is mandated for use in selective catalytic reduction systems installed in diesel vehicles. Majority of modern diesel vehicles are fitted with urea-based SCR technology that requires dosing of diesel exhaust fluid for effective reduction of NOx emissions from the exhaust stream. With rising sales of diesel vehicles integrated with SCR systems globally, the automotive OEM segment is expected to continue dominating the market over the forecast period.

Key Takeaways

The global diesel exhaust fluid market is expected to witness high growth. The market is forecast to reach a value of US$ 11.60 Mn by 2024 from US$ 6.44 Mn in 2018, registering a CAGR of 7.6% during the forecast period.

Regional analysis: North America region currently dominates the global diesel exhaust fluid market and is expected to maintain its leading position during the forecast period. Stringent emission norms in countries like the US that mandate the use of SCR systems in diesel vehicles, is driving the demand for diesel exhaust fluid in the region. The Asia Pacific region, led by China and India, is projected to witness the fastest growth owing to rising sales of diesel vehicles and implementation of emission standards equivalent to Euro 6 in many countries.

Key players: Key players operating in the diesel exhaust fluid market are Yara International, BASF SE, CF Industries Holdings Inc., Agrium Inc., Cummins Inc., Shell ROTELLA (Royal Dutch Shell Inc.), Mitsui Chemicals Inc. These companies are focusing on capacity expansion strategies to cater to the growing demand for diesel exhaust fluid. They are also collaborating with automakers to secure long-term supply agreements.