Japan's Asphalt and Bitumen Market: Dependence on Imports, Trade Patterns, and Long-Term Outlook

Japan's asphalt and bitumen market has experienced significant volatility during the last few years, but in WPB's view, the long-term trend is one of consistent but incremental improvement. The industry experienced a steep drop in 2024, when consumption fell by nearly 16% to 37,000 tons, with the overall market value falling to $23 million. Despite this precipitous decline, estimates indicate that the market will bounce back in the coming decade. Volumes are seen to increase to approximately 37,000 tons by the year 2035, and the market value is estimated to reach approximately $28 million, with an annual growth rate of 1.6%.

The 2024 downturn came on the heels of subdued performance as the import and consumption business had previously also recorded weak growth since 2020. Prior market volumes had peaked at 46,000 tons but the latest downturn is meant to emphasize demand vulnerability to broader industrial and economic conditions. Analysts nonetheless believe that Japan's import reliance, coupled with stable infrastructure requirements, will underpin recovery.

South Korea remains ahead of Japan's import trend by a significant percentage. In 2024, it contributed 34,000 tons—equivalent to 91% of import quantities. The United States was the second contributor, with only 2,700 tons, significantly lower than South Korea's contribution. In terms of value, South Korea's imports were $21 million, with the United States contributing barely more than $2 million. Over the last decade, South Korea’s export share to Japan has expanded at an average annual pace of nearly 9% in value, consolidating its role as the primary partner in this market.

Import prices have been broadly steady though volumes of trade have varied. Average import price dropped to $637 a ton during 2024, not much different from the previous year. The most favorably priced South Korean supplies were at $609 a ton, and then U.S. supplies at $756 a ton on average. Longer-term fluctuations in prices have been small, with broadly steady global supply conditions for asphalt and bitumen.

On the export side, Japan plays a lesser role. 2024 exports dropped to barely over 530 tons, 5.5% less than the previous year. Revenues from exports also dropped to $732,000. Taiwan was the largest destination, taking almost 70% of Japan's exports, followed by Singapore and Zambia but much smaller percentages. Export prices dropped sharply in 2024, to an average of $1,375 per ton—36% down from the previous year. The drop indicates weaker external demand and fiercer competition for local markets. Export prices used to fluctuate historically, as evidenced by surges such as $2,877 per ton in 2016, but current trends indicate stagnation.

Dependence on a single major supplier highlights the risk of exposing Japan to the external market forces. Where more than 90% of asphalt and bitumen are brought in from South Korea, any trade disruption has the potential to reflect instantly on the stability of supply. Conversely, the relatively low level of domestic production and weak export performance add further to the fact that Japan is still largely an import-driven market.

In the coming years, the trend in the industry will be dictated by infrastructure development requirements, demand from the construction industry, and economic activity level. While the growth rate based on volumes will remain modest at a paltry 0.1% per annum, the rising value indicates price stability and marginal improvement in demand to fuel the market. By 2035, the estimated worth of $28 million suggests a cautious yet optimistic recovering scenario, suggesting Japan's bitumen and asphalt market will be of strategic importance despite foreign reliance.

Overall, while Japan's asphalt and bitumen market plummeted in 2024, structural reliance on South Korean imports, inter alia, ensures continuity of supply. Small-scale exports persist, and the major recipient is Taiwan. Consistent trends of pricing and incremental demand will support a measured recovery, positioning the industry to register modest growth over the period of ten years.

By Bitumenmag

Bitumen, Japan, Price