Recently, the overall domestic asphalt market has shown a strong upward trend, driven by refinery production cuts and maintenance, as well as a significant reduction in supply. The market supply has fallen to a new low, highlighting the structural imbalance between supply and demand, which has driven the asphalt market prices to continue to rise. The overall situation is characterized by tight supply and firm prices.
Recently, the domestic asphalt market has shown a trend of low supply and high prices, with market supply once again breaking historical lows, and spot and futures prices continuing to rise. Data shows that the current comprehensive capacity utilization rate of domestic asphalt manufacturers is only 13.6%, hitting a historical low. The weekly production has decreased significantly compared to the previous period, and the overall available spot resources are very scarce.
The core reason for the significant contraction in supply is the concentrated maintenance of multiple refineries, coupled with the conversion of some units to residual oil, and the loss of processing profits and low production willingness of refineries. In June, the production schedule of local refineries decreased significantly year-on-year and month on month. The demand side is showing a trend of differentiation, with better weather in the north, steady progress in infrastructure and road construction, and a rebound in downstream essential procurement, providing strong support for prices.
At present, the imbalance between supply and demand in the market continues. Although the rainy season in the south has to some extent suppressed terminal construction, the overall demand resilience is still acceptable. In the short term, the low-level supply pattern of asphalt is difficult to improve quickly, and the shortage of supply will continue. The market price is expected to remain high and fluctuate.
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