Bitumen prices remained stable despite a 35,000 Toman bitumen price increase in the Stock Exchange. 35,000 Tomans is equal to 8.00 USD/MT which is passed onto consumers which import bitumen. However, because USD value in Iran is at a historic high, this has caused the price increase to be seemingly ineffective. Meaning the conversion of USD into Iran’s local currency has neutralized the much dredded price increase in bitumen value. It is easy to view this price increase for raw materials also known as Vacuum Bottom as an adjustment to maintain the same level prices as the previous month.
We are Bulk bitumen suppliers Iran. Our company is now involved in the export of high quality road bitumen in bulk via bulk vessels to neighboring countries such as Oman, UAE, Pakistan, India and many others. After production, Bulk bitumen is initially stored in storage tanks near Bandar Abbas port and loaded onto Bulk bitumen vessels which can be sourced either by our company or the buyer.
When crude oil prices were over 100 USD per barrel, Iran’s bitumen prices were in the range of 500 USD to 600 USD/MT on a FOB basis. As crude oil prices took a barrish turn so did bitumen prices. It should come at no surprise to bitumen importers that as crude oil prices increase so will Bitumen rates.
This recent 8.00 USD/MT price increase in raw materials to produce bitumen in addition to the 67.00 USD from last month equal 76.00 USD/MT total in price increases. This is mainly the outcome of the bullish prices of crude oil rates.
Raw material to produce high quality bitumen in Iran increased bitumen prices 67.00 USD/MT in the stock exchange.
Let us examine some of the causes:
One of the reasons bitumen prices in Iran have increased is due to the increasing crude oil prices. Another factor bitumen prices in Iran have acended is the Government’s new policy for its new exchange rate against the USD. In the past 5 years or so Iran’s currency has lost nearly 400 % value against the USD. The Government in aims to control inflation on imported goods had provided certain products such as food and medicine a more affordable exchange rate. It also provided certain other less crucial imported needs of the nation a more affordable exchange rate. The government rate had always been less than that of the free market. Overall there was a decent gap between the Government’s exchange rates and that of the free market. With that virtually out of the way now the Government has decided to close the gap and increase it’s exchange rate to that of the free market. This new policy will impact nearly all aspects of Iran’s imported and exported product rates. Presently there will be a minimum of 10% difference in the value of purchasing or converting Government USD to that of the free market. For example, when in the past we bought bitumen or raw feed we paid the government in USD based on the exchange rates implemented by the government. Therefore by using this advantage we were able to discount our bitumen prices for consumers. This is because we sold bitumen at the free market exchange rates but paid the government a lower exchange rate. But now we cannot provide this incentive and pass it onto our customers and we will look towards our officials to balance the scales and bring Irab bitumen prices within a more affordable range.
Will there be a reverse in Iran bitumen price policy?
in the pastwhen such an event occurred the Government lowered the prices of Vacuum Bottom VB the raw material needed to produce bitumen which brought back bitumen prices to a managable and predictable price range. If Iran’s bitumen industry would like to compete in the international market which we are certain it does it will create the necessary balance.With that said, Iran’s prices for bitumen is one of the most affordable bitumen available in the market.
Due to the increase of Crude Oil prices, bitumen prices in Iran are now unstable and we will be offering new rates to our customers next week.
Nearly all bitumen producers and suppliers have stopped offering bitumen prices or are suggesting prices at least 10 USD/MT higher than the norm. This is due to the fact that no one yet knows the effects rising crude oil prices will have on bitumen prices. As the price of crude oil rises so does Vacuum Bottom prices.
If you would like purchase bitumen from us or receive consultation or require a product within Iran’s export industry please contact + 98 912 101 6609 and speak to Mr. Aghili or email us at email@example.com and visit www.iran-bitumen.com for updated bitumen prices.
Not all bitumen qualities are suitable for road construction. Imagine a customer unknowingly purchasing bitumen suitable for insulation and/or roofing and not intended for road construction. Is the saving of 10.00 USD/MT to 20.00 USD/MT worth damaging their hard earned investment and reputation?
There are endless customers which are familiar with Iranian bitumen. They have previously purchased it from Iranian suppliers and are satisfied with the quality and the service they have received. This is excellent! We are all thankful to those suppliers and buyers for supporting Iran’s petrochemical industry. Expert suppliers give other noble suppliers the chance to also sell bitumen to the various customers with bitumen in the future. While one bad experience can contribute to the eventual collapse of this industry.
Our focus in this article is the customers which may not have received the quality which they expected and are wondering why? or the ones who are just beginning your experience in the bitumen market please consider the following guidance to make the best informed decision.
Why do we reiterate this point about quality and pricing over and over?
Continuous customer feedback about the bitumen prices they are receiving which are too low to be for road quality bitumen
Customer feedback about the bad experiences they have had or know someone who has dealing with low quality bitumen which are often supported with pictures or evidence
The continued challenge of respectable bitumen producers, brokers, and suppliers who struggle to compete with low quality bitumen offers which are unsubstantiated in most cases. In other cases if there is bitumen of such low pricing it is generally not suitable for road construction. It also primarily does not comply with ASTM standards.
Good suppliers are not saying that low quality or rather off specs bitumen as per ASTM standards has no place in the market. Not at all. All types of qualities are essential to exist in any market for different purposes. The bitumen community is advising bitumen enthusiasts understand that all bitumen qualities are not the same. New bitumen clients often suggest that all bitumen prices should be exactly the same. Our customer service department usually replies by asking them should all shoes, glues, cloth or paint cost the same price? This question clearly answers itself as there are various levels of quality and purpose for each product.
Bitumen buyers should not ask a high quality bitumen producer to offer them the same rates as a supplier who is offering them bitumen suitable for roofing or other purposes and not necessarily road construction. This will surely get their blood boiling and show them that you’re actually not well informed about this business and it’s going to be a long time before you are wise enough to make the right decision on your purchase.
We will soon discuss our personal view on how the international inspection company(s) method of taking samples of bitumen can improve and distinguish the quality differences. One way is to take bitumen samples from the bottom of the bitumen drums as well as the top. By not doing so only the top layer of the bitumen is only tested and what good is a partial test of a product?
Customer can always contact Iran Bitumen without any obligation at + 98 912 101 6609 via Whatsapp, IMO, Viber, or Telegram and ask our expert advice.
If you have been victimized or would like to share your story to raise awareness, please share your story with us. You will remain anonymous
This is a personal blog/post. Any views or opinions represented in this blog are personal and belong solely to the blog/post owner and do not represent those of people, institutions or organizations that the owner may or may not be associated with in professional or personal capacity, unless explicitly stated.
Any views or opinions are not intended to malign any religion, ethnic group, club, organization, company, or individual.
All content provided on this blog is for informational purposes only. The owner of this blog/post makes no representations as to the accuracy or completeness of any information on this site or found by following any link on this site.
The owner will not be liable for any errors or omissions in this information nor for the availability of this information. The owner will not be liable for any losses, injuries, or damages from the display or use of this information.
This blog disclaimer is subject to change at anytime.
Share not all bitumen are suitable for road construction
Iran Bitumen prices increase by nearly 12.00USD/MT on the 21st January . This bitumen prices increase is based on the increase in value of Vacuum Bottom also known as VB which is used to produce high quality road bitumen for export from Iran.
Another factor which has affected bitumen rates is the decline in USD value in Iran from an average of 4,000.00 Tomans per 1.00USD to nearly 3,800.00 Toman. These two forces have increase bitumen prices an average of 15.00USD to 20.00USD/MT from their previous state.
If USD value gains strength in Iran we may see a slight decline in bitumen prices in Iran.
Iran Bitumen prices increase 162,000 Toman in the stock exchange which after taxes will mean a minimum of 50.00USD/MT bitumen price increase in the Iran bitumen market.
The main factors which have played a key role in this price rise in bitumen value includes the high demand for bitumen from Iran by the international bitumen market which includes India, Asia and Africa, the increase in crude oil value and the limitation in the output of crude by OPEC.
While some still hold very little stock of bitumen which they can compromise on its prices and offer lower rates, soon the rates for bitumen 60/70 and bitumen 80/100 once those very minor stocks are depleted, will rise to the expected levels. Bitumen rates can be expected to be at least 300.00USD/MT to 310.00USD on a FOB Bandar Abbas Iran basis in new steel drums of 180 Kg .
Many bitumen buyers will halt their purchase of bitumen and wait to see if the prices of bitumen will come down, however, because OPEC has limited their production of crude, bitumen prices along with crude oil prices will continue to rise.
Let us not forget before the crude oil market crashed Iran bitumen prices were between 400.00USD to 500.00USD/MT. Our prediction is that the prices of bitumen will push upwards to close the gap which has been created in this industry over the last 1-2 years.
Our suggestion to bitumen importers and bitumen brokers, as previously stated in our news section before this price increase is the same. With bitumen prices on the rise investing in your bitumen purchase before bitumen prices rise once again in Iran’s stock exchange will be an investment worth making.
Bandar Abbas Bitumen Refineries are effected by slow VB output. While it appears Bandar Abbas Refinery which supplies Vacuum bottom for the production of bitumen is going into overhaul, our company is able to secure bitumen from Pasargad Oil refinery or Jey Oil Refinery until this issue is resolved. It should come as no surprise that the prices embossed Pasargad bitumen are slightly higher than privately produced bitumen. The main reason for the price difference is the consistency in their quality. Some private refineries have been known to utilize different products other than the main ingridient for bitumen productions which is VB therefore when you purchase Government produced bitumen which is “embossed” with their label you are buying yourself an extrra layer of protection and that protection costs a little extra.
If you require to buy Pasargad embossed bitumen or Jey Oil embossed bitumen, please send us your inquiry to bitumen inquiry and we shall send you our best possible Pasargad or a Jey Oil bitumen offer.
You may also contact us on whatsapp messanger at + 98 912 1016609