At the end of June, East Riding Council in Yorkshire reported that it was postponing its annual surface dressing programme due to soaring bitumen prices. It’s not alone.
In the Mediterranean and other parts of Europe, the start of the summer road-building season has been pushed back. Indian road contractors downed tools as they feared they wouldn’t be compensated for rising costs. And Sweden’s transport authority Traficverket is stopping some maintenance projects after bitumen prices rocketed by 40%.
Bitumen prices always fluctuate, with price movements generally shadowing those of crude oil, since bitumen is a by-product of the oil refining process. The bitumen price graph has been on an upward trajectory since January this year, although it has started to tail off recently. Like other construction materials, the Ukraine conflict has fuelled that steep incline.
There are other factors which impact on the supply and pricing of the bitumen-based products used in our roads: shipping and transport costs; the cost of the energy needed to heat bitumen so that it remains liquid; fuel to produce the mixes at asphalt plants; chemicals in additives. And bitumen prices do vary around the world; bitumen arbitrage sees traders moving it from one region to another to profit from those differences.
The other thing that complicates the bitumen story is that not all oil distilleries make it, and the bitumen from those that do varies hugely in its composition, due to the type of crude oil used and the technology at the distillery. The composition of bitumen is important, particularly the proportion of asphaltenes it contains because it is these which make it ductile and elastic; loss of them over time leads to ‘ageing’ of bitumen, making it more brittle.
When it comes to oil types, heavy crudes – rather than light crudes – produce the largest quantities of bitumen during distilling. Russia’s Urals crude produces good proportions of bitumen, which made it attractive to Nynas, one of the few firms to specialise in producing bitumen. Nynas used Russian crude until March this year when it announced that it would no longer be doing so.
Bitumen suppliers may mix different sources of bitumen to get the right grade of bitumen, which is determined by putting it through certain tests. However, those tests have not changed over the years, and experts argue that a blend of modern bitumens, with a lot of the ‘goodness’ taken out by modern distilleries, can pass the same test as a single-source bitumen would have done 15 years ago but it won’t have the same chemical composition or performance.
In summary, there’s a lot more to bitumen than its cost. And not all bitumens are created equal. Specialist suppliers will have done the due diligence on their sources of their bitumen, tested them rigorously and treated them so that the performance of the end product is guaranteed, not just its ability to pass historic tests. They would probably say you get what you pay for…
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