The bitumen market is slowly responding to supply shortages with the introduction of trial bitumen mixes on roads in South Africa.
The ability to develop new bitumen and admixture technologies that support greater worker safety, enhanced environmental protection and improved road surfacing treatment opens up the market to increased innovation.
New analysis from Frost & Sullivan (http://www.chemicals.frost.com), Market for Bitumen and Additives in Road Infrastructure in South Africa, finds that the market earned revenues of $270 million in 2010 and estimates this to reach $462 million in 2017.
“The future of the bitumen market is likely to be fuelled by new government funded road infrastructure projects in the short-to long-term,” notes Frost & Sullivan’s Chemicals, Materials and Food Research Analyst Bhavisha Jaga.
“The drive to grow and sustain the bitumen industry, due to the supply shortage, will be largely influenced by health, environmental and safety concerns in the future.”
High chemical fume emissions, associated with bitumen, have motivated the use of warm mix asphalt in certain regions in South Africa. Novel bitumen technology offers many advantages, including lower fuel consumption, reduced carbon emissions and increased worker safety. All these factors will work towards preventing the road construction industry from suffering from the supply shortage of bitumen in the medium-term.
High crude oil prices serve to exacerbate the limited production of bitumen by refineries in South Africa. In addition to the long waiting period to establish an asphalt plant, producers of asphalt also face daily logistical issues and this makes it difficult to improve bitumen supply to the road sector.
“In a market where there is no co-ordination between refineries to refine bitumen, it becomes difficult to measure whether there is sufficient bitumen supply to meet market demand,” explains Jaga.
“The asphalt market also attempts to promptly respond to market demand and it seems likely that the adoption of global bitumen technologies, such as recycled asphalt, will boost capacity for bitumen usage in the future.”
The main bitumen producers in South Africa are four refineries that are highly dependent on crude oil prices. Despite the type of dependence, there are certain operations that can be followed to make the bitumen industry more sustainable.
“It is important that refineries co-ordinate their refinery shutdown to ensure that the open refineries meet market demand for bitumen,” advises Jaga. “The regulation of bitumen prices will go a long way towards ensuring that the bitumen market remains competitive and sustainable in the future.”