US Asphalt Overview Trends and the 2010 Picture

Transcription

1 US Asphalt Overview Trends and the 2010 Picture By Nasreen Tasker Editor, Argus Asphalt Report NAPA s 56 th Annual Meeting, February 6-9, 2011 London, Houston, Washington, Jersey City, Portland, Calgary, Santiago, Bogotá, Johannesburg, Dubai, Singapore, Tokyo, Beijing, Sydney, Moscow, Astana, Kiev and Berlin Who is Argus? Report every energy market globally. Used worldwide in energy price indexation. Independent and owned by the family of the founder and by the employees. Around 300 employees. Strict corporate ethics policies. Compliance program with regular internal audits. Global offices: London Houston Washington, DC Jersey City Portland Calgary Santiago Bogota Johannesburg Dubai Singapore Tokyo Beijing Sydney Moscow Astana Kiev Berlin

2 Argus Asphalt Report The Argus Asphalt Report is a weekly publication covering US and international asphalt prices, market developments and industry news. Argus assesses spot market prices by surveying a wide variety of market participants including buyers, sellers, producers, contractors, traders and brokers. It includes information on the factors which affect and influence asphalt trade and prices Presentation outline US supply/demand from EIA Demand, production, imports and exports 2010E* picture Trends over the last few years US asphalt demand vs the world US and world asphalt prices US regional prices Impact of economics on pricing *2010E uses Jan-Nov actual data + Dec estimated

3 US regions US asphalt supply/demand 2010E Demand < Production Demand = 23.6mn short tons, 0.5% increase Production = 24.4mn short tons, 4.3% increase Imports = 1.24mn short tons, 13.1% drop Exports = 1.90mn short tons, 6.9% increase Inventory = 3.38mn short tons, 5.1% increase

4 US asphalt supply/demand 2010E Demand = 23.6mn short tons, 0.5% increase Production = 24.4mn short tons, 4.3% increase Imports = 1.24mn short tons, 13.1% drop Exports = 1.90mn short tons, 6.9% increase Inventory = 3.38mn short tons, 5.1% increase Asphalt demand by US region

5 US regional demand: Change 2010E vs 2009 US asphalt demand

6 US asphalt supply/demand 2010E Demand = 23.6mn short tons, 0.5% increase Production = 24.4mn short tons, 4.3% increase Imports = 1.24mn short tons, 13.1% drop Exports = 1.90mn short tons, 6.9% increase Inventory = 3.38mn short tons, 5.1% increase Asphalt production by US region

7 US regional production: Change 2010E vs 2009 US asphalt production

8 US asphalt production and demand US asphalt supply/demand 2010E Demand = 23.6mn short tons, 0.5% increase Production = 24.4mn short tons, 4.3% increase Imports = 1.24mn short tons, 13.1% drop Exports = 1.90mn short tons, 6.9% increase Inventory = 3.38mn short tons, 5.1% increase

9 Asphalt imports by US region Asphalt imports by US region (2010)

10 US asphalt imports US imports by country of origin: 2000 vs 2010 YTD

11 US asphalt supply/demand 2010E Demand = 23.6mn short tons, 0.5% increase Production = 24.4mn short tons, 4.3% increase Imports = 1.24mn short tons, 13.1% drop Exports = 1.90mn short tons, 6.9% increase Inventory = 3.38mn short tons, 5.1% increase Asphalt exports by US region

12 Asphalt exports by US region (2010) US asphalt exports

13 US asphalt supply/demand 2010E Demand = 23.6mn short tons, 0.5% increase Production = 24.4mn short tons, 4.3% increase Imports = 1.24mn short tons, 13.1% drop Exports = 1.90mn short tons, 6.9% increase Inventory = 3.38mn short tons, 5.1% increase US asphalt inventories

14 Net inter-regional movements 2010E East coast received around 1.2mn st, up 26% Midwest 669k st moved out, up 42% Gulf coast 573K st moved out, up 12% Net asphalt balance (2010)

15 Comparison of US vs world US is still the largest consumer of asphalt However, the US market makes up a smaller portion of the world Asian market gaining China has the strongest projected growth rate for asphalt China and India combined projected to exceed peak US demand by 2015 Price graphs All asphalt prices are from the Argus Asphalt Report All asphalt prices are from the Argus Asphalt Report All crude prices are from Argus Crude Report

16 Global wholesale asphalt prices, fob basis mid-may 2010 (in USD/t) Lowest price Global wholesale asphalt prices, fob basis mid-october 2010 (in USD/t) Lowest prices

17 Global wholesale asphalt prices, fob basis late January 2011 (in USD/t) Still lowest prices Global asphalt retail prices

18 US asphalt retail prices Texas asphalt retail prices vs Maya

19 Gulf coast asphalt barge vs Maya Impact of economics

20 Breakeven economics Maya breakeven diff to Gulf coast asphalt barge

21 HSFO economics HSFO alt value diff to Gulf coast barge

22 Coking economics Coker value diff to Gulf coast asphalt barge

23 Summary US Trends Demand down 33.7% from 2005 Production down 26.7% from 2005 Imports down 62% from 2006 Exports up 170% from 2005 US Supply/Demand for 2010 Demand was flat, but was the market driver in 2010 Production > Demand Exports continued to rise arbitrage opportunities to different countries Imports declining one main source US price impact Trend The asphalt pricing world has changed! Caused by roller coaster ride with crude followed by price volatility Refiners watching margins, production costs and alternative costs Willingness to respond In 2010 Prices continued to move directionally with crude and upward pressure from economics In 2H10,,prices were not increasing in line with crude due to US demand concerns and higher production levels Prices lagged most international markets

24 Thank you! Nasreen Tasker Editor, Argus Asphalt Report London, Houston, Washington, Jersey City, Portland, Calgary, Santiago, Bogotá, Johannesburg, Dubai, Singapore, Tokyo, Beijing, Sydney, Moscow, Astana, Kiev and Berlin