China’s bitumen producers cut production on weak demand

12 April 2013 09:43  [Source: ICIS news]

SINGAPORE (ICIS)--Many bitumen producers in China will halt production and put their facilities under maintenance in April-May in response to weakening demand,  industry sources said on Friday.

Bitumen prices have been declining since early March because of high inventories.

Most traders have stopped purchasing as they have sufficient stocks on hand. Furthermore, there is no demand from the end-users, particularly for road projects, because road paving works cannot be carried out in the raining season of January-April, the sources said.

About 5.2m tonnes/year of bitumen capacity will be taken off line during April-June, ICIS data showed. The production cut is expected to last until May-June when road projects begin.

An industry source said it expects re-stocking activity to only take place by early or mid-May, which means that most refiners will continue to have high inventories until then.

The inventories of imported cargoes are also high at present, since lots of imports arrived in the first quarter have yet to be sold, the sources said.

Bitumen prices are expected to remain weak for April and May amid sluggish demand and ample supply.

Refiner

Location

Maintenance schedule

Shutdown capacity

Sinopec Qilu Petchem

Zibo, Shandong

2 April-9 May

600,000 tonnes/year

Befar Binyang Petchem

Binzhou, Shandong

5 April-Late April

1m tonnes/year

PetroChina Liaohe Petchem

Panjin, Liaoning

15 April-15 May

500,000 tonnes/year

WenZhou PetroChina Fuel Chemical

Wenzhou, Zhejiang

20 April-1 May

700,000 tonnes/year

Alpha (Jiangyin) Bitumen

Jiangyin, Jiangsu

3 May-3 June

900,000 tonnes/year

China Offshore Bitumen (Taizhou)

Taizhou, Jiangsu

4 May-15 June

900,000 tonnes/year

Sinopec Guangzhou

Guangzhou, Guangdong

1 May-20 June

600,000 tonnes/year

 


By: Jessie Yang



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