Fuel Smarts

North America DEF Demand Approaching 1 Billion Gallons

December 04, 2014

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Consumption of diesel exhaust fluid across North America has been rising in recent years and is set to hit a milestone of one billion gallons by 2019, according to the newly published DEF Market Dynamics Report by Integer Research.

The rise of selective catalytic reduction, an after-treatment emissions technology that requires the use of diesel exhaust fluid to reduce harmful NOx emissions, is driving DEF demand in a rapidly expanding North American market that is now almost unrecognizable from just four years ago when DEF was in its infancy, according to the report.

As demand races ever higher, there has been a shift in supply of the fluid from jugs and drums to larger bulk deliveries, and a tremendous increase in DEF truck stop locations. The report said the number of DEF pump locations across North America has tripled in two years from 550 in mid-2012 to over 1,700 by June 2014.

The report details how certain supply modes have been following diverse pricing patterns since the start of the market. For example, DEF prices from truck stops have remained largely stable over the last two years, whereas bulk sales are much more volatile and dependent on urea prices and on the level of competition in a specific area.

In 2010, U.S. Environment Protection Agency stringent emission standards took effect, which prompted most of the medium and heavy-duty truck market to deploy SCR in their new engines. All truck engine makers later adopted the technology.

“Our research shows that heavier trucks are by far the main drivers of DEF consumption in the region, however, the light-duty and passenger car sector, as well as the off-highway sector, are adding to demand and we estimate overall consumption of DEF across North America to hit one billion gallons in 2019,” said Fabricio Cardoso, editor of the report.

Pickup trucks, sport utility vehicles and other diesel passenger cars and light-duty commercial vehicles are increasingly taking up SCR, meaning that the requirement for DEF across these sectors is also rising, according to the report. The diesel market for passenger cars in North America is still marginal compared to gasoline engines, but is rapidly expanding.

Another important sector consuming more and more DEF is off-highway equipment used in the agricultural, construction, forestry and mining industries. Strict emission requirements for these machines have led to OEMs taking a similar approach to the truck market and making SCR the after-treatment technology of choice.

The findings of Integer’s DEF Market Dynamics Report reveal that DEF consumption from off-highway equipment is also likely to increase at a faster pace from 2017 onwards,

As well as examining DEF demand, The DEF Market Dynamics Report analyses the existing supply chain in North America, listing the different types of producers, distributors and retailers. It also assesses the competitiveness of domestic urea producers to deliver DEF to the main consumption markets or to supply concentrated urea solution to a dilution plant, in comparison to the available imported options.

A copy of the report is available from Integer Research.

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