South Korea bitumen exports could start entering southeast Asia in the coming months, following the recent opening of the arbitrage window between the two regions.
Export prices from South Korea have declined sharply over the past week, weighed down by early-week declines in upstream crude and high-sulphur fuel oil values. A Yeosu-based refiner concluded an export tender to sell up to four May- and June-loading cargoes on 10 April, which was settled in the range of $375-385/t fob South Korea, according to market participants.
Declines in fob Singapore bitumen export pricing have been slower in comparison, as continued production output cuts contributed to curtailed spot supplies. Most refiners in Singapore have fully committed April- and May-loading volumes, although several traders were still holding on to unsold volumes.
In contrast, a steady supply of April- and May-loading cargoes has been made available from South Korean suppliers over the past month. One refiner previously released three export tenders in March alone, far more than the typical one per month.
Arbitrage economics to export bitumen from South Korea to southeast Asia has grown more favourable, as fob Singapore premiums over that of fob South Korea values widened.
Spreads between fob Singapore and South Korea widened to $42.50/t on 10 April, up from $22.50/t a week earlier. This is the widest since November 2024, when fob Singapore prices also traded at premiums of $42.50/t to that of South Korean exports.
Traders who won some shipments from the recent South Korean export tender may direct some of these volumes to southeast Asia, rather than sell them to the traditional export destination market of east China.
Domestic prices in east China have come under renewed pressure in the week to 11 April, undermined by consecutive day-on-day losses in the bitumen futures market. This, coupled with a weaker yuan against the US dollar, has put a dent on Chinese appetite for South Korean exports.
These South Korean exports could eventually be shipped to Vietnam, where demand has been relatively more robust compared with other Asian countries, market participants said.
Pricing competition in north Vietnam has intensified in 2025 on increased export supplies from south China. And with South Korean exports likely to join the fray, this could temporarily edge out Vietnam's imports of Singapore-origin bitumen.
