A Bitumen Price Wave On the Way
Due to the New Year holiday in Iran, the internal market was almost quiet, and companies were almost busy with their last year commitments.
The shipping lines had roughly same situation, only two direct vessels sailed out to the Indian ports.
Monitoring bitumen prices in Iran within the last year, it can be concluded that since the beginning of the year till the end,
prices increased more than 3 times that happened as a result of exchange rate in NIMA system,
jump of fuel price and the strong competitions among the refineries.
In coming week, we can expect a significant growth in the market since:
- demands are being received from different regions by the end of official holidays in Iran
- Bitumen price has globally increase in Singapore, Italy, South Korea, Greece, and Bahrain.
- Selling Iran crude oil in OPEC has started with a range of over 60$.
- Internal inflation is more than 30%.
- Ocean freight has increased and there is shortage of containers among the shipping lines.
- During the pandemic of COVID-19, all the businesses were affected by heavy losses and now by the start of vaccination, they hope to recover the losses.
- Removing TAX exemption on bitumen export, the base price will increase at least 4.5%.
- In 2020, many of the bitumen producers in the Europe and Far East Asia were expecting to gain considerable profits by producing Low Sulphur Fuel Oil (LSFO) so they stopped their bitumen production and produced LSFO, but by the outbreak of COVID-19 and increase of bitumen demand in the market, there were a limited number of supplier in the market and its effects can be observed in 2021.
By the official start of working days in Iran market, the new VB price will be released
by IME and based on the estimations, an increase of 4.62 % is expected to happen.
Also, it is forecasted to face an increase of 7-8$/MT in bitumen price of India market.
This article was prepared by Razieh Gilani, the sales manager of Infinity Galaxy (www.infinitygalaxy.org).