Asphalt in China

As Quoted In International Construction - KHL

Demand for asphalt in China is expected to rise five percent annually through 2012. Asphalt consumed in the manufacture of paving products will outpace roofing uses, driven by extensive infrastructure projects in paved surface construction. The ongoing Flat to Slope roof conversion project will benefit asphalt shingles.

This study analyzes the 13.2 million metric ton asphalt industry in China. It presents historical demand data for the years 1997, 2002 and 2007, and forecasts for 2012 and 2017 by product (e.g., asphalt cement, asphalt emulsions, cutback asphalts, built-up and roll roofing, modified bitumen roofing, asphalt shingles), new construction and maintenance/repairs markets, and geographic region.

The study also considers market environment factors, details industry, evaluates company market share and profiles 19 industry participants, including China Petroleum & Chemical, China National Petroleum, and China National Offshore Oil.

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TABLE OF CONTENTS SECTION PAGE INTRODUCTION x I. EXECUTIVE SUMMARY 1 II. MARKET ENVIRONMENT 4 General 4 Economic Overview 4 Recent Economic Performance 6 Economic Outlook 7 Demographic Overview 10 Population 11 Households 13 Industrialization & Manufacturing Trends 14 Labor Force & Employment Trends 17 Personal Income & Expenditures 20 Banking System & Regulations 22 Currency Exchange 27 Nonbuilding Construction Outlook 31 New Construction 33 Improvements & Repairs 34 Transportation 35 Building Construction Outlook 37 Residential 40 New Housing 43 Additions & Alterations 44 Maintenance & Repairs 45 Housing Stock & Living Space 47 Nonresidential 49 New Construction 53 Additions & Alterations 54 Maintenance & Repairs 55 Building Stock 55 The Eleventh Five-Year Plan 57 Legal & Regulatory Issues 59 Technology Trends 60 Competing Materials 61 World Outlook 62 Foreign Trade 64 III. PRIMARY ASPHALT 66 General 66 Supply & Demand 69 Primary Asphalt Types 70 IV. ASPHALT PRODUCTS 72 General 72 Paving 74 Asphalt Cement 76 Asphalt Emulsions 78 Cutback Asphalts 81 Other Paving Asphalts 82 Roofing 84 Built-Up & Roll Roofing 86 Modified Bitumen Roofing 89 Asphalt Shingles 92 Other Roofing Asphalt Products 94 Other Asphalt Products 95 V. ASPHALT PRODUCT MARKETS 98 General 98 Nonbuilding Construction 100 New 101 Maintenance & Repairs 103 Nonresidential Building Construction 104 New 106 Improvements & Repairs 108 Residential Building Construction 110 New 111 Improvements & Repairs 113 Other Markets 114 VI. REGIONAL TRENDS 116 General 116 Regional Demographic & Economic Trends 118 Population Patterns 119 Economic Outlook 121 Construction Expenditures 122 Nonbuilding Construction Expenditures 124 Nonresidential Building Construction Expenditures 125 Residential Building Construction Expenditures 127 Regional Asphalt Demand 129 Central-North 131 Overview 131 Asphalt Demand 133 Northeast 135 Overview 135 Asphalt Demand 138 Central-East 140 Overview 140 Asphalt Demand 142 Central-South 144 Overview 144 Asphalt Demand 146 Southwest 148 Overview 148 Asphalt Demand 150 Northwest 152 Overview 152 Asphalt Demand 154 VII. INDUSTRY STRUCTURE 157 General 157 Industry Composition 157 Market Share 159 Foreign Participation in the Chinese Market 162 Legal & Regulatory Issues 162 Joint Ventures 164 Wholly Owned Foreign Enterprises 166 Representative Offices 167 Exporting to China 168 Cooperative Agreements 168 Company Profiles 172 Anglo American plc 173 Bouygues SA 175 Caltex Corporation, see Chevron Corporation Chevron Corporation 177 Colas SA, see Bouygues SA China National Offshore Oil Corporation 178 China National Petroleum Corporation 180 China Offshore Bitumen Company Limited, see China National Offshore Oil Corporation China Petroleum & Chemical Corporation 181 China Petroleum Sales Jiangsu Company Limited, see PetroChina Company Limited CNOOC Bitumen Sichuan Limited, see China National Offshore Oil Corporation Dalian West Pacific Petrochemical Company Limited, see PetroChina Company Limited and Total SA Exxon Mobil Corporation 185 Foshan Zhongyou Gaofu Petroleum Company Limited, see China National Petroleum Corporation Guangyuanfa Elf Bitumen Company Limited, see Total SA Neste Oil Oyj 186 Panjin Northern Asphalt Company Limited 187 Panjin Nynas North Bitumen Company Limited, see Panjin Northern Asphalt Company Limited Panjin PetroChina Liaohe Asphalt Company Limited, see PetroChina Company Limited PetroChina Company Limited 189 Qinhuangdao Zhongyou Petrochemicals Company Limited, see PetroChina Company Limited Rizhao Lanshan Caltex Asphalt Company Limited, see Chevron Corporation Royal Dutch Shell plc 192 Sanshui Yihao Asphalt Company Limited 195 Shandong Befar Group Company Limited 196 Shandong Huifeng Petroleum & Chemical Company 197 Shandong Qingyuan Group Company Limited 198 Shanghai Pusheng Asphalt Concrete Limited, see Anglo American plc Shell China Limited, see Royal Dutch Shell plc Shell Road Service Shanghai Company Limited, see Royal Dutch Shell plc Sinopec Corporation, see China Petroleum & Chemical Corporation SK Energy Company Limited 199 Tipco Asphalt Public Company Limited, see Bouygues SA Total SA 201 Weifang Hongrun Petrochemical Auxiliary Company 203 Wenzhou Zhongyou Fuel Petrochemical Company Limited, see China National Petroleum Corporation Xinjiang Bazhou Tianyuan Petrochemical Company 204 LIST OF TABLES TABLE NUMBER PAGE SECTION I -- EXECUTIVE SUMMARY Summary Table 3 SECTION II -- MARKET ENVIRONMENT 1 Gross Domestic Product of China 10 2 Population of China 12 3 Households in China by Region 14 4 Manufacturing Value Added in China 16 5 Urban Labor Force & Employment Trends in China, 1997-2007 19 6 Personal Income & Expenditures in China 22 7 Interest Rates in China, 1997-2007 26 8 Chinese Currency Exchange Rates, 1997-2007 30 9 Nonbuilding Construction Expenditures in China 33 10 Paved Roads in China by Region 36 11 Building Construction Expenditures in China 39 12 Residential Building Construction Expenditures in China 43 13 Housing Stock & Living Space in China 49 14 Nonresidential Building Construction Expenditures in China 53 15 Nonresidential Building Stock in China 56 16 World Asphalt Demand by Region 63 17 Asphalt Foreign Trade in China 65 SECTION III -- PRIMARY ASPHALT 1 Primary Asphalt Supply & Demand in China 70 SECTION IV -- ASPHALT PRODUCTS 1 Asphalt Demand in China by Product 73 2 Paving Products in China -- Asphalt Demand by Type 76 3 Asphalt Cement Demand in China 78 4 Asphalt Demand in Asphalt Emulsions in China 81 5 Asphalt Demand in Cutback Asphalts in China 82 6 Asphalt Demand in Other Paving Products in China 84 7 Roofing Products in China -- Asphalt Demand by Type 85 8 Built-Up & Roll Roofing -- Asphalt Demand in China 88 9 Modified Bitumen Roofing -- Asphalt Demand in China 91 10 Asphalt Shingles -- Asphalt Demand in China 93 11 Other Roofing Products -- Asphalt Demand in China 95 12 Other Asphalt Products -- Asphalt Demand in China 97 (continued on next page) SECTION V -- ASPHALT PRODUCT MARKETS 1 Asphalt Demand in China by Market & Application 99 2 Nonbuilding Construction -- Asphalt Demand in China 101 3 New Nonbuilding Construction -- Asphalt Demand in China 102 4 Nonbuilding Maintenance & Repairs -- Asphalt Demand in China 104 5 Nonresidential Building Construction -- Asphalt Demand in China 106 6 New Nonresidential Building Construction -- Asphalt Demand in China 108 7 Nonresidential Building Improvements & Repairs -- Asphalt Demand in China 109 8 Residential Building Construction -- Asphalt Demand in China 111 9 New Residential Building Construction -- Asphalt Demand in China 112 10 Residential Building Improvements & Repairs -- Asphalt Demand in China 114 11 Other Markets -- Asphalt Demand in China 115 SECTION VI -- REGIONAL TRENDS 1 Population of China by Region 121 2 Gross Domestic Product of China by Region 122 3 Construction Expenditures in China by Region 124 4 Nonbuilding Construction Expenditures in China by Region 125 5 Nonresidential Building Construction Expenditures in China by Region 127 6 Residential Building Construction Expenditures in China by Region 129 7 Asphalt Demand in China by Region 130 8 Central-North Region of China: Asphalt Demand 135 9 Northeast Region of China: Asphalt Demand 140 10 Central-East Region of China: Asphalt Demand 144 11 Central-South Region of China: Asphalt Demand 148 12 Southwest Region of China: Asphalt Demand 152 13 Northwest Region of China: Asphalt Demand 156 SECTION VII -- INDUSTRY STRUCTURE 1 Revenue Data: Selected Asphalt Companies, 2007 159 2 Selected Cooperative Agreements 170 LIST OF CHARTS CHART NUMBER PAGE SECTION II -- MARKET ENVIRONMENT 1 Population of China by Age, 1997-2017 13 2 Urban Unemployment Rate in China, 1997-2007 19 3 Interest Rates in China, 1997-2007 27 4 Chinese Currency Exchange Rates, 1997-2007 30 5 Building Construction Expenditures in China by Type, 1997-2017 40 6 World Asphalt Demand by Region, 2007 64 SECTION III -- PRIMARY ASPHALT 1 Primary Asphalt Flow Chart 68 SECTION IV -- ASPHALT PRODUCTS 1 Asphalt Demand in China by Product, 2007 74 2 Roofing Asphalt Demand by Type, 2007 86 SECTION V -- ASPHALT PRODUCT MARKETS 1 Asphalt Demand in China by Market, 2007 100 SECTION VI -- REGIONAL TRENDS 1 Asphalt Demand in China by Region, 2007 131 2 Central-North Region of China 133 3 Northeast Region of China 138 4 Central-East Region of China 142 5 Central-South Region of China 146 6 Southwest Region of China 150 7 Northwest Region of China 154 SECTION VII -- INDUSTRY STRUCTURE 1 Asphalt Market Share in China by Company, 2007 160

Asphalt in China

Purchase Asphalt in China by the Section

Asphalt in China

1 INTRODUCTION

2 EXECUTIVE SUMMARY

Table | ASPHALT DEMAND IN CHINA BY END USE (thousand metric tons)

3 MARKET ENVIRONMENT

3.1 General

3.2 Economic Overview

3.2.1 Recent Economic Performance

3.2.2 Economic Outlook

Table | GROSS DOMESTIC PRODUCT OF CHINA

3.3 Demographic Overview

3.3.1 Population

Table | POPULATION OF CHINA (million persons)

3.3.2 Households

Table | HOUSEHOLDS IN CHINA BY REGION (million units)

3.4 Industrialization & Manufacturing Trends

Table | MANUFACTURING VALUE ADDED IN CHINA (billion 2006 yuan)

3.5 Labor Force & Employment Trends

Table | URBAN LABOR FORCE & EMPLOYMENT IN CHINA, 1997 - 2007

3.6 Personal Income & Expenditures

Table | PERSONAL INCOME & EXPENDITURES IN CHINA (billion yuan)

3.7 Banking System & Regulations

Table | INTEREST RATES IN CHINA (annual percentage rate)

3.8 Currency Exchange

Table | CHINESE CURRENCY EXCHANGE RATES (yuan per foreign currency)

3.9 Nonbuilding Construction - Overview

Table | NONBUILDING CONSTRUCTION EXPENDITURES IN CHINA (billion 2006 yuan)

3.9.1 New Construction

3.9.2 Improvements & Repairs

3.9.3 Transportation

Table | PAVED ROADS IN CHINA BY REGION (thousand kilometers)

3.10 Building Construction Outlook

Table | BUILDING CONSTRUCTION EXPENDITURES IN CHINA (billion 2006 yuan)

3.10.1 Residential

Table | RESIDENTIAL BUILDING CONSTRUCTION EXPENDITURES IN CHINA (billion 2006 yuan)

Table | HOUSING STOCK & LIVING SPACE IN CHINA

3.10.2 Nonresidential

Table | NONRESIDENTIAL BUILDING CONSTRUCTION EXPENDITURES IN CHINA (billion 2006 yuan)

Table | NONRESIDENTIAL BUILDING STOCK IN CHINA (million square meters)

3.11 The Eleventh Five-Year Plan

3.12 Legal & Regulatory Issues

3.13 Technology Trends

3.14 Competing Materials

3.15 World Outlook

Table | WORLD ASPHALT DEMAND BY REGION (million metric tons)

3.16 Foreign Trade

Table | ASPHALT FOREIGN TRADE IN CHINA (thousand metric tons)

4 PRIMARY ASPHALT

4.1 General

4.2 Supply & Demand

Table | PRIMARY ASPHALT SUPPLY & DEMAND IN CHINA (thousand metric tons)

4.3 Primary Asphalt Types

5 ASPHALT PRODUCTS

5.1 General

Table | ASPHALT DEMAND IN CHINA BY PRODUCT (thousand metric tons)

5.2 Paving

Table | PAVING PRODUCTS IN CHINA -- ASPHALT DEMAND BY TYPE (thousand metric tons)

5.2.1 Asphalt Cement

Table | ASPHALT CEMENT DEMAND IN CHINA (thousand metric tons)

5.2.2 Asphalt Emulsions

Table | ASPHALT DEMAND IN ASPHALT EMULSIONS IN CHINA (thousand metric tons)

5.2.3 Cutback Asphalts

Table | ASPHALT DEMAND IN CUTBACK ASPHALTS IN CHINA (thousand metric tons)

5.2.4 Other Paving Asphalts

Table | ASPHALT DEMAND IN OTHER PAVING PRODUCTS IN CHINA (thousand metric tons)

5.3 Roofing

Table | ROOFING PRODUCTS IN CHINA -- ASPHALT DEMAND BY TYPE (thousand metric tons)

5.3.1 Built-Up & Roll Roofing

Table | BUILT-UP & ROLL ROOFING -- ASPHALT DEMAND IN CHINA

5.3.2 Modified Bitumen Roofing

Table | MODIFIED BITUMEN ROOFING -- ASPHALT DEMAND IN CHINA

5.3.3 Asphalt Shingles

Table | ASPHALT SHINGLES -- ASPHALT DEMAND IN CHINA

5.3.4 Other Roofing Asphalt Products

Table | OTHER ROOFING PRODUCTS -- ASPHALT DEMAND IN CHINA (thousand metric tons)

5.4 Other Asphalt Products

Table | OTHER ASPHALT PRODUCTS -- ASPHALT DEMAND IN CHINA (thousand metric ons)

6 ASPHALT PRODUCT MARKETS