Bitumen Futures Contract Specs
Last updated: 2026-10-08
The standard bitumen futures contract — the Singapore Bitumen Futures (SBF) — is a physically deliverable contract for 10 tonnes per lot, quoted in USD per metric tonne, with a minimum price tick of $0.25/tonne ($2.50 per lot) and a typical initial margin of 8–12% of contract value. At a reference price of $450/tonne, one lot carries a notional value of $4,500, while the CIF Med (CIFMED) grade basis typically trades at a $10–35/tonne discount to Singapore (SIN) cargoes. Contracts are listed monthly out to 12–24 months forward, and the most liquid front-month contracts clear 2,000–8,000 lots per day on the Singapore Exchange (SGX).
This guide breaks down every bitumen futures contract spec — lot size, tick, margin, settlement, delivery windows — and compares the major exchanges so traders and buyers can hedge without surprises.
Contract Specifications at a Glance
Bitumen futures exist mainly on two venues: SGX (Singapore) and DCE (Dalian Commodity Exchange, China), with some over-the-counter (OTC) swap activity referencing them. SGX dominates international physical hedging because its delivery points cover Singapore, South Korea, China, and the Middle East.
| Specification | SGX Bitumen Futures (SBF) | DCE Bitumen Futures (BU) |
|---|---|---|
| Contract size | 10 tonnes/lot | 10 tonnes/lot |
| Price quote | USD/tonne | CNY/tonne |
| Minimum tick | $0.25/tonne ($2.50/lot) | 1 CNY/tonne (10 CNY/lot) |
| Contract months | 12 consecutive months + Qtrs | Monthly, up to 36 months |
| Settlement | Physical delivery | Physical delivery |
| Last trading day | 3rd business day before last delivery day | 15th of delivery month |
| Initial margin | 8–12% of notional | 8–15% of notional (exchange-set) |
| Daily price limit | No fixed limit (SGX) | ±4–7% (DCE banded) |
| Average daily volume | 2,000–8,000 lots (front month) | 500,000–1,500,000 lots (all months) |
| Typical delivery unit | 2,000–5,000 tonnes (vessel cargo) | 10–200 lots (truck/barge) |
Key takeaway: SGX SBF is a 10-tonne financial-to-physical hybrid used by international traders; DCE BU is a 10-tonne retail-liquidity contract dominated by Chinese domestic speculators and producers.
Price Basis, Grades, and Delivery Points
Bitumen futures prices are not uniform — the same contract references a benchmark grade, and every physical cargo trades at a basis differential to that benchmark.
- SGX SBF: Benchmark is bitumen 60/70 penetration grade (pen 60/70), conforming to ASTM D946 / AASHTO M20.
- DCE BU: Benchmark is 70# grade (pen 70) per Chinese national standard GB/T 15180.
- Quality penalties apply for penetration, softening point, and solubility deviations — typical rejection thresholds are pen ±5 dmm and softening point ±3°C.
| Grade / Origin | Basis vs SIN SBF | Notes |
|---|---|---|
| SIN 60/70 | +$0 (par) | Benchmark; delivery in Singapore tanks |
| CIFMED 60/70 | –$10 to –$35/t | Wider in Q4, tighter in Q2 |
| South Korea 60/70 | –$5 to –$20/t | FOB Ulsan/Yosu |
| Middle East (Fujairah) | –$15 to –$40/t | Freight and quality driven |
| China 70# (DCE basis) | CNY-denominated | Not directly arbitrageable with SIN SBF |
- Most physical deals in Asia price as SIN SBF ± differential, settled monthly.
- A $10/tonne basis move on a 5,000-tonne cargo = $50,000 P&L swing — enough to decide whether a trade is profitable.
Margin, Leverage, and Tick Economics
Margin is where bitumen futures contracts differ most from crude oil futures. Because bitumen is illiquid relative to Brent or WTI, exchanges set higher percentage margins.
| Exchange | Initial Margin | Maintenance Margin | Leverage |
|---|---|---|---|
| SGX SBF | 8–12% ($360–$540) | ~75% of initial | 8x–12x |
| DCE BU | 8–15% ($360–$675 eq.) | ~80% of initial | 6x–12x |
| Typical broker add-on | +2–5% | — | Reduces to 6x–8x |
- 1 tick (SGX) = $0.25/tonne = $2.50 per 10-tonne lot.
- Brokerage: ~$5–$15 per round turn per lot, exchange fees ~$1–$2.
- Break-even move: roughly 1.5–3 ticks ($0.38–$0.75/tonne) to cover costs.
Practical implication: a $5/tonne move = 20 ticks = $50/lot gross profit — meaningful for a hedger covering 200 lots ($10,000).
Hedging and Speculation Strategies
Bitumen futures serve two very different users, and the contract specs determine who can use them effectively.
- Short hedge: a refiner holding 5,000 tonnes of stock sells 500 lots (5,000 ÷ 10) to lock in today's price.
- Long hedge: a road-paving contractor with a fixed-price tender buys 200 lots to cap input cost for 2,000 tonnes.
- Basis risk: hedgers carry residual risk if their grade (e.g., CIFMED) diverges from SIN benchmark — historically $10–$35/tonne.
- Delivery option: SGX allows physical settlement in Singapore-based tanks; most traders cash-settle before last trading day to avoid tankage costs.
- Volatility: bitumen realized volatility typically runs 25–40% annualized, higher than WTI (~30%) during demand spikes (Q3 road season).
- Seasonality: prices historically firm +3–6% from April to July on Asian road-construction demand, then soften –2–5% by November.
- Spread trades: calendar spreads (front vs. 3-month) capture $5–$25/tonne contango or backwardation swings.
| Strategy | Position Size Example | Capital (at 10% margin) | Target Move |
|---|---|---|---|
| Short hedge | 500 lots (5,000 t) | ~$225,000 | Neutralize $5/t drop |
| Long hedge | 200 lots (2,000 t) | ~$90,000 | Cap $10/t rise |
| Directional spec | 20 lots (200 t) | ~$9,000 | $5/t = +$1,000 |
| Calendar spread | 50 lots long/short | ~$22,500 | $10/t = +$500 |
Comparison: Bitumen vs. Other Energy Futures
Traders often ask whether to hedge bitumen with crude futures. The answer is usually no — correlation is imperfect.
| Feature | SGX Bitumen (SBF) | DCE Bitumen (BU) | ICE Brent | NYMEX WTI |
|---|---|---|---|---|
| Lot size | 10 t | 10 t | 1,000 bbl | 1,000 bbl |
| Notional/lot (approx.) | $4,500 | ~$4,500 eq. | $70,000 | $68,000 |
| Margin % | 8–12% | 8–15% | 5–10% | 5–10% |
| Daily volume | 2,000–8,000 lots | 500k–1.5M lots | 400k–1M lots | 500k–1.2M lots |
| Physical delivery | Yes (tanks/vessels) | Yes (trucks/barges) | Rare | Rare |
| Correlation to crude | 0.55–0.75 | 0.5–0.7 | — | — |
Interpretation: bitumen tracks crude only 55–75% of the time. A crude hedge leaves 25–45% of price risk unhedged — too much for a road contractor with thin margins.
- Cross-hedging ratio: roughly 0.6–0.8 tonnes of bitumen per barrel-equivalent of crude if cross-hedging is unavoidable.
- Better approach: hedge directly with bitumen futures and accept the basis risk.
Contract Lifecycle: Timelines and Deadlines
Timing errors are the #1 cause of delivery failures in bitumen futures. Know these dates.
- First notice day: ~5 business days before last delivery day.
- Last trading day: 3rd business day before last delivery day.
- Delivery window: final 5 business days of the contract month.
- Position limit: most brokers cap speculative positions at 500–2,000 lots without approval.
| Action | Timing | Reason |
|---|---|---|
| Roll hedge forward | 7–10 days before LTD | Liquidity concentrates in front month earlier |
| Reduce margin exposure | 5 days before LTD | Margins raised 1–2% in expiry week |
| Confirm delivery intent | 3–5 days before LTD | Avoid forced cash settlement penalties |
- Expiry-week liquidity drop: volume can fall 40–60% in the final 3 days — rolling early costs less slippage.
- Margin escalation: exchanges often raise initial margin by +1–2 percentage points in the final week before delivery.
FAQ: Bitumen Futures Contract
Q1: What is the contract size of a bitumen futures contract?
Both SGX Bitumen Futures and DCE Bitumen Futures use a 10-tonne lot size. At a $450/tonne price, one SGX lot is worth $4,500 notional. This makes it far smaller than Brent (1,000 barrels ≈ $70,000), so bitumen hedging is granular and accessible.
Q2: How much margin do I need to trade bitumen futures?
Expect 8–12% initial margin on SGX, plus broker add-ons of 2–5%. That means roughly $360–$675 per 10-tonne lot at a $450/tonne price. Margin rises 1–2 percentage points in the final week before contract expiry.
Q3: What is the minimum tick and its value?
On SGX, the minimum tick is $0.25 per tonne, which equals $2.50 per 10-tonne lot. That's the smallest price move you can trade. Break-even after fees typically requires a move of 1.5–3 ticks ($0.38–$0.75/tonne).
Q4: How does bitumen futures correlate with crude oil futures?
Bitumen futures correlate with Brent and WTI at roughly 0.55–0.75, meaning 25–45% of bitumen price risk is unhedged if you only use crude. That's why direct bitumen hedging via SGX SBF or DCE BU is preferred for physical exposure. Cross-hedging requires a ratio of about 0.6–0.8.
Q5: When do bitumen futures contracts expire and how do I roll?
SGX SBF's last trading day is the 3rd business day before last delivery day, with delivery in the final 5 business days of the month. Roll your position 7–10 days before expiry — volume drops 40–60% in the final three days. DCE BU expires on the 15th of the delivery month.
Lock In Your Bitumen Costs with the 6Tar Calculator
Every $10/tonne move on a 5,000-tonne cargo swings your P&L by $50,000. Before you place a hedge on any bitumen futures contract, you need to know your exact landed cost — freight, basis differential, margin, and financing included.
Use the 6Tar cost calculator to model:
- Landed cost per tonne for SIN, CIFMED, and Fujairah grades
- Hedge ratio matched to your physical tonnage (in 10-tonne lots)
- Margin requirements at 8–12% and broker add-ons
- Basis differential impact on total cargo value
Get your number in under 60 seconds — no signup required. Run the 6Tar cost calculator now →