The Africa Bitumen Market is estimated to be valued at US$ 418.71 Mn in 2022 and is expected to exhibit a CAGR of 5.3% over the forecast period 2021 to 2028, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
Bitumen is a thick, black, highly viscous liquid or semi-solid that is present in most crude petroleum and in some natural deposits. It is an essential building block for construction of roads. Rising infrastructure development and construction activities across the African continent are generating significant demand for bitumen. Africa accounts for around 30% of global bitumen consumption. Major applications of bitumen in Africa include road construction and asphalt pavement. Bitumen provides excellent waterproofing and binding properties which makes it ideal for use in construction of roads, highways, parking lots, bridges, dams, and other building structures. The advantages of bitumen in construction include flexibility, durability and cost-effectiveness.
Market key trends:
Growth in Africa’s construction industry is driving bitumen demand. According to estimates, the construction industry in Africa is projected to grow at 5-6% annually over the next decade due to large-scale investments in infrastructure, housing, and commercial construction projects. Majority of countries in Africa are emphasizing on improving road connectivity to support economic growth. This has increased the consumption of bitumen for applications such as road construction and paving. Furthermore, rising transportation and logistics in the region is propelling the need for more highways, freeways, and expressways which utilizes bitumen-based materials. Increased private and public funding towards development of transportation networks in Africa is expected to boost the uptake of bitumen during the forecast period.
Porter’s Analysis
Threat of new entrants: The threat of new entrants in the Africa bitumen market is low as it requires huge capital investment to establish bitumen production facilities. Also, the key players already have an established supply network across Africa.
Bargaining power of buyers: The bargaining power of buyers is moderate as there are multiple players operating in the Africa bitumen market providing options to buyers. However, the switching cost for buyers is high if they change their existing suppliers.
Bargaining power of suppliers: The bargaining power of suppliers is high given the consolidated nature of suppliers for key raw materials for bitumen production. Also, the suppliers can influence prices of raw materials.
Threat of new substitutes: The threat of substitutes is moderate as there are limited substitutes for bitumen available in the construction industry in Africa. However, new product innovation may pose potential threats.
Competitive rivalry: The competition is high among the key players to increase their market share in the lucrative Africa bitumen market.
Key Takeaways
The Africa bitumen market is expected to witness high growth, exhibiting CAGR of 5.3% over the forecast period, due to increasing road construction activities and development of transport infrastructure projects across countries.
Regional analysis
South Africa dominates the Africa bitumen market and is expected to continue its dominance, growing at a CAGR of over 6% during the forecast period. This can be attributed to ongoing transport and road construction projects in the country. Nigeria is expected to emerge as the fastest growing market for bitumen in Africa supported by rising investments in infrastructure development projects.
Key players
Key players operating in the Africa bitumen market are Exxon Mobil Corporation, Royal Dutch Shell Plc., RAHA Bitumen, Inc., Tekfalt Binders (Pty) Ltd., SprayPave, Indian Oil Corporation Ltd., GOIL Company Limited, Wabeco Petroleum Ltd., Tiger Bitumen, and Richmond Group. Exxon Mobil Corporation and Royal Dutch Shell Plc. collectively accounts for over 35% share of the Africa bitumen market.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
