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Industrial white lubricating oil will affect price of grease

 industrial white lubricating oil will affect price of grease

Industrial white base oil is one of the essential materials for the production of white high temperature grease and Its inclusion in the consumption tax on refined oil may push up the price of grease.2021 is set to be an extraordinary year. With the increase of base oil, additives and packaging materials, major grease enterprises have issued their own price increase letters, such as Mobil, Shell, Juntai, Castrol and other brands. Therefore, please grease dealers, when customers make inquiries, please follow the price of the day. 

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In order to strengthen the collection and management of refined oil consumption tax, maintain a fair tax order and create a good business environment, the always sensitive issue of consumption tax has been pushed to the forefront. In China, various invoice names are used to standardize the sale of base oil, such as transformer oil, heat conduction oil and industrial white oil. However these make out the name of the back but have common goal - "exempt from paying consumption tax". On the market now, it is "basic hair ticket price rises", goods do not rise.

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What is the impact of the inclusion of industrial white lubricating oil in excise tax on refined oil on the grease industry?

The reason why base oil can issue these invoices is that, in essence, base oil products are covered in the categories of mineral oil, and the physical and chemical indicators of these products are very similar, and the invoice name is also divided according to whether the consumption tax is included.

China's consumption tax on refined oil products is only levied in the initial stages of production, commissioned processing and import, and the collection process is single. As a result, refined oil products produced from different channels are sold at different prices when entering the market, so the starting point of competition is different. Under the consumption tax standard, whether to pay consumption tax will have a great impact on the upstream and downstream enterprises of base oil and the lubricating oil industry. In addition, because consumption tax belongs to tax in price, assume duty by the seller. The raw material for the production of refined oil is crude oil or fuel oil. Crude oil needs to pay resource tax, while fuel oil that needs to pay consumption tax can be deducted from the consumption tax paid when producing taxable products, namely refined oil. Therefore, it can be speculated that each purchase of lubricating base oil and high temperature grease base oil should bear the cost of consumption tax on refined oil.

Accordingly, it can be speculated that in the future, no matter how the trend of oil prices, lubricating oil, grease will usher in a wave of rising tide again.

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