FocusChina bitumen demand to surge on new roads in 2011-2015

17 June 2011 06:35  [Source: ICIS news]

By Jessie Yang and Anakyn Zhang

GUANGZHOU (ICIS)--China’s demand for high-quality bitumen is expected to rise by as much as 7.5m tonnes/year in 2011-2015 because of plans to develop the country’s road network, C1 Energy, an ICIS service in China, said on Friday.

Bitumen, also known as asphalt, is used in road construction and paving, as well as in water proofing of homes and industrial buildings.

The estimate is based on China’s plans to build 61,000km (37,900 miles) of new highways across the country under its ongoing 12th five-year development plan, data from provincial transport departments showed.

Over the next five years, the government’s plans for infrastructure development will largely be focused on the central, northern and western parts of China, particularly in Hunan and Sichuan province, the Xinjiang Uyghur Autonomous Region and Inner Mongolia Autonomous Region, according to the plans of provincial transport departments.

Over 3,600km of new expressways will be built in each of those areas, according to the data.

The construction plans will boost demand for imported bitumen and that of locally made grade A heavy-duty bitumen.

China’s bitumen consumption may rise from the 20.1m tonnes/year seen in 2010 to 27.7m tonnes/year by 2015, which translates to an annual growth rate of over 6%, according to C1 Energy.

The maintenance and expansion of existing national and provincial highways in southern China and the Yangzte River Delta will also contribute to the growth in bitumen demand, traders said.

In China, maintenance normally starts five to seven years after an expressway is built, thus 2011-2015 will be a peak maintenance and expansion period for expressways that were opened to traffic in 2006-2011.

As potential demand grows, some local players will intensify their efforts in developing bitumen storage and transportation facilities, a source at Hunan Gaosu Guangxin Petrochemical said.

The company is responsible for the purchase, transportation, storage and processing of bitumen used for Hunan province’s expressways.

Hunan Gaosu Guangxin constructed a total of 85,000cbm of bitumen tanks in late 2010 and plans to bring on line another 50,000cbm of storage tanks in 2011, the company source said.

These tanks are located in Hunan province, two of which are equipped with polymer-modified bitumen units, he added.

Jiangsu Baoli Asphalt and Rizhao Xingguang Bitumen are also planning to build polymer-modified bitumen refineries in Xinjiang to reduce the gap between the growth in infrastructure development and bitumen capacity expansion in Xinjiang, sources at the two companies said.

Similarly, with the surge in expressway construction expected in the Inner Mongolia Autonomous Region, some bitumen traders in northeastern China have already ventured into the Inner Mongolia market, said a source at Xiamen Huate Group, a major bitumen supplier in China.

Xi’an Guolin Industry is also planning to build a new polymer-modified bitumen processing plant and bitumen storage tanks in Inner Mongolia, a source at the company said.

Additional reporting by Yu Yunfeng and Alfa Li

Please visit the complete ICIS plants and projects database
For more information on bitumen, visit ICIS chemical intelligence
Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections

By: Jessie Yang

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly