Diesel Exhaust Fluid Materials: Optimizing Engine Efficiency with Precision


Diesel Exhaust Fluid Market is estimated to Witness High Growth Owing to Stringent Emission Norms

Diesel exhaust fluid (DEF) or aqueous urea solution is an essential product used in selective catalytic reduction (SCR) technology to lower emissions of nitrogen oxide (NOx) from diesel engines. DEF helps convert up to 90% of NOx emissions into harmless nitrogen and water via the SCR system. It has gained importance due to stringent emission regulations mandated by environmental agencies globally to curb air pollution. The global DEF market is estimated to be valued at US$ 11.60 Mn in 2024 and is expected to exhibit a CAGR of 7.6% over the forecast period 2023 to 2030.

Key Takeaways

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. and KOST USA. These players are focusing on capacity expansion and new product launches to capitalize on the growing demand.

The rising concerns regarding vehicular emissions and stringent emission norms present significant growth opportunities in the DEF market. The adoption of SCR systems in off-road vehicles and non-road mobile machineries has been increasing which is expected to drive the demand for DEF over the next few years.

North America, Europe, and Asia Pacific collectively account for around 90% of the global DEF market. Stringent emission regulations and increasing vehicles sales supported by government initiatives are encouraging the use of SCR systems in commercial vehicles which is boosting the DEF market in these regions. However, other regions such as Latin America and Middle East & Africa are also expected to provide potential growth opportunities during the forecast period.

Market drivers

Stringent emission norms laid down by environmental agencies such as EURO VI and BS-VI for commercial vehicles have enhanced the adoption of SCR technology. DEF works as an essential reagent in SCR systems to reduce NOx emissions from diesel engines and meet compliance. This is a major factor driving the DEF market.

As diesel engines account for over 30% of global vehicle sales, the growing vehicle parc worldwide is translating into increased demand for DEF. According to industry estimates, nearly 5-8 liters of DEF is consumed per 1,000 km by heavy commercial trucks. This leads to sizable requirement of DEF and supports the growth of the market.

PEST Analysis
Political: Any laws and regulations concerning emission standards of vehicles and promotion of environment-friendly automobiles impact the diesel exhaust fluid market. The stringent emission norms drive the demand for SCR systems and DEF.
Economic: Stable economic conditions coupled with rising disposable incomes boost vehicle sales and miles driven annually, increasing the consumption of DEF. Commercial vehicles form a significant part of the mobile emission source.
Social: Growing environmental concerns and awareness among public regarding air pollution has led automakers to adopt greener technologies. This elevates the need for diesel particulate filters and SCR systems equipped vehicles which in turn support the DEF demand.
Technological: Advancements in catalytic converter technology enable meeting the stringent emission regulations with minimized DEF dosage requirement. Alternative powertrain technologies like electric and hybrid vehicles can replace diesel engines to some extent in the long-run.

The diesel exhaust fluid market in terms of value is concentrated majorly in North America and Europe. North America constitutes an important regional market owing to the large in-use vehicle parc and strict emission standards implemented by USA and Canada. Europe has the highest diesel vehicle population globally fueling the DEF sales. The average miles covered annually by commercial vehicles transporting goods within Europe also contributes to the demand.

The Asia Pacific region is identified as the fastest growing market for diesel exhaust fluid propelled by proliferating vehicle sales led by China and India. China has also rolled out stricter emission norms and mandated use of SCR catalysts in vehicles to curb rising air pollution, creating a conducive environment for DEF consumption. Growth opportunities will rise from the increasing middle-class population, industrialization and expanding commercial transportation activities across Asian countries in the future.

1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it”