Annual production of 6.5 million tons of bitumen in Iran

Iran Producing 6.5 Million Tons Annually

Iran's bitumen industry prominent actor in the world market with an impressive annual production of 6.5 million tons. This remarkable product not only fulfills domestic needs but also plays a vital role in international trade and exports large quantities to various countries. This blog examines the details of Iran's bitumen production, its domestic consumption and the challenges facing this industry.

This remarkable product fulfils Iran's internal needs, and Iran continues to play an important role in meeting the world's needs. Iran exports bitumen to most countries.

Domestic Consumption and Export

Out of the 6.5 million tons of bitumen produced annually in Iran, 2.5 million tons are consumed domestically. This consumption is critical for infrastructure projects within the country, particularly in road construction and maintenance of building insulation.

The remaining 4 million tons are exported to 22 countries, generating approximately $1.5 billion in revenue each. This export activity underscores Iran's importance in the global bitumen market and its ability to meet international demand effectively.

The Industry Landscape

According to Davood Mohammadi, who spoke at the 13th International Bitumen, Asphalt, and Related Industries Exhibition, Iran hosts 80 active companies in the bitumen production sector. These companies are instrumental in ensuring a steady supply for domestic use and export.

Challenges of the bitumen industry

One of the important challenges facing Iran's bitumen industry is raw materials, especially "vacuum bottom", which is the primary input for bitumen production. The open auction method for selling these materials in the commodity exchange has led to costs. As a result, 20 to 30 companies are secure these essential materials due to price and supply issues. This price hike in raw materials inevitably results in higher production costs, making it more challenging for Iranian bitumen to compete to world.

Types of Bitumen and Their Uses

Bitumen production involves various processes, leading to different types of bitumen, each with specific applications:

Petroleum Bitumen:

Produced through the distillation of crude oil, this type is widely exported.

Natural Bitumen:

Sourced from natural deposits, it is also a significant export product.

Blown Bitumen:

Created by blowing air through heated bitumen, this type is used in specific industrial applications.

Penetration Grade Bitumen

Among the various types of bitumen, penetration-grade bitumen is particularly popular in the export market. The 60/70 penetration grade bitumen is ideal for road surfacing, while the 60/90 grade is primarily used for hot asphalt production. Other grades like 85/100 and 50/70 produce hot asphalt and bituminous mixes for roads, airport runways, and other surfaces.

Global Bitumen Market

The global bitumen market is substantial, with countries like the United States, China, India, France, and Indonesia being the largest importers. In 2022, the U.S. imported about $3 billion worth of bitumen, reflecting its extensive infrastructure needs. China followed with imports valued at $1.5 billion, while India and France imported $1.2 billion and $559 million, respectively. Indonesia also had significant imports, amounting to $522 million.

Conclusion

Iran's bitumen industry plays an essential role in the development of domestic infrastructure and the global supply chain of bitumen. Despite facing challenges related to raw material procurement and production costs, the industry continues to grow with the support of a strong network of manufacturers and exporters. With the continuous demand for bitumen in road construction and other sectors, Iran's bitumen production continues to play a significant role in the global market.