Potential supply chain cost savings from innovative cold bitumen handling

Abstract

To compensate for seasonal price variations of bitumen for road asphalt, in addition to the usual approaches of forward-contracts and hot bitumen storage, innovative techniques for cold bitumen storage have emerged. As a case study, hot bitumen storage and additional integration of cold bitumen storage in the bitumen supply chain of the second largest asphalt producer in Germany are economically assessed. Hot and cold bitumen storage combined allows overall costs to be reduced by almost 5%. Therefore, storage capacities should be increased. Cold bitumen handling may complement hot storage as it is to some extent already economically attractive, with further cost reductions expected in the future.