India’s bitumen consumption in November rose from the previous month because of stronger demand for roadworks following the end of the monsoon season.
Demand was at 722,000t through November, up by 23pc compared with October, India’s oil ministry data showed.
India’s bitumen consumption in November rose from the previous month because of stronger demand for roadworks following the end of the monsoon season.
Demand was at 722,000t through November, up by 23pc compared with October, India’s oil ministry data showed.
Consumption in India as been on the downtrend since April,as issues around the disbursement of project funds by some state governments slowed down road works. Following that, the onset of the monsoon season from June put further brakes on demand within the country.
The increase in domestic consumption was reflected in robust demand for imports from the Middle East. Indian refiners also switched to processing more high-sulphar crude to raise output of the road-paving material, in an effort to capitalise on firm demand and positive margins for bitumen.
But the demand outlook for December has so far been bearish as delayed disbursement of project funds by state governments hampared roadworks in parts of India. Some importers and road contractors are also finding it hard to liquidate volumes on a cash basis, because of the shortage of cash payments for projects.
Profit margins, especially for imported cargoes, have been squeezed as they have been incurring demurrage costs owing to loading delays at a key Middle East port. The delays resulting from congestion at the Middle East port have restricted the availability of bulk vessels, which has in turn pushed up freight costs for the Middle East to west coast India route.
By Sathya Narayanan
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