Chinese bitumen imports in 2020 increased by 11pc from 2019 to 4.75mn t despite Covid-19 lockdowns early in the year and the impact of the pandemic on road construction projects. Apparent consumption totalled 37.07mn t in 2020, up by 16.38pc from 2019 at 31.85mn t, according to data from GTT. A strong recovery in production coupled with the approaching end of China's 13th five-year economic plan for 2016-20 accounted for the resurgence in imports and higher apparent consumption. Higher imports and apparent consumption occurred despite an unusually long monsoon season that lasted from July-September and halted most road works across China. Imports from South Korea and Singapore, the biggest bitumen suppliers to China, totalled 3.72mn t, making up 78.2pc of total imports. Volumes from South Korea in 2020 rose to 2.39mn t, up by 2.5pc to 2.33mn t compared with 2019.
Imports from Singapore soared to record volumes of 1.32mn t in 2020, up by 25.7pc from 2019. This occurred despite ExxonMobil's bitumen production cuts "on or around May" that constricted supplies from the producer for the rest of the year. The Singapore unit can produce about 100,000-120,000 t/month of bitumen. Following the crash in crude oil futures in April 2020, bitumen buyers moved to stockpile volumes in the second quarter of 2020 before the monsoon season. Imports in the second quarter of 2020 rose to 1.4mn t, up by 15pc quarter-on-quarter. This made up for slower months when wet weather curtailed road work projects. Chinese bitumen production increased to a three-year high of 32.8mn t in 2020, up by 16pc from 2019 production volumes of 28.2mn t, according to local market sources. The country's production in the last quarter of 2020 remained elevated by at least 30pc on a monthly basis as production margins for bitumen remained comparatively higher compared with those of middle distillates.
The fall in crude prices had also boosted bitumen margins to at least 1,000 yuan/t ($150/t) in 2020, prompting players to optimise bitumen production. Relatively higher margins prompted teapot refineries that were uninvolved in bitumen to enter the market. Most volumes went into tankages, exerting downward pressure on prices. State-controlled PetroChina and Sinopec later dropped prices twice in the week ending 18 September to encourage sales. Despite higher production, Chinese bitumen exports in 2020 fell by 13.6pc to 566,934t from 656,356t in 2019. Regional bitumen appetite was slightly limited as most southeast Asian buyers struggled to cover from the impact of Covid-19. Australia and Vietnam remained the biggest buyers of Chinese bitumen exports in 2020 at 154,857t and 193,112t, respectively, up by 49pc and 77.9pc. But Chinese exports to Thailand and Indonesia fell to 5,000t and 23,424t respectively, down by 28.2pc and 69pc from 2019. Sinopec's Maoming refinery exported lower spot volumes in the second half of 2020, citing strong domestic bitumen appetite that limited spot exports to comparatively weaker regional markets. More details of the next five-year plan for 2021-25 will be announced in March.