Narrow fluctuations in the asphalt market in February

According to the Commodity Market Analysis System of Business Society, the domestic asphalt market fluctuated narrowly in February. From February 1st to 29th, the average producer price of asphalt in Shandong Province increased from 3585 yuan/ton to 3606 yuan/ton, an increase of 0.60%, and the price decreased by 7.31% year-on-year.

 

At the beginning of the month, driven by the rise in international crude oil prices, refinery costs were significantly supported, and prices in some regions were pushed up. The widespread rain and snow weather has hindered the demand for essential goods, and the downstream terminal demand in the north and south is weak, with basic contract warehousing being the main focus. The asphalt market is showing a state of weak supply and demand, and the situation of price but no market is gradually emerging.

 

After the Spring Festival, the rain and snow weather in the area hindered demand, and traders showed high enthusiasm for quoting. However, actual transactions were average, and some spot asphalt prices remained stable but declined.

 

On the cost side, in terms of crude oil, international crude oil prices fluctuated at a high level in February. During the traditional Chinese Lunar New Year holiday, international crude oil experienced a strong rebound. The main reason is focused on the issue of geopolitical tension in the Middle East. As of the close on February 28th, the settlement price of Brent crude oil futures main contract was $82.15 per barrel, a decrease of $0.41 or 0.5%.

 

On the supply side, the decline in production from main businesses and local refineries has had a supportive effect on prices at the beginning of the month. However, by the end of the month, the amount of available finished products is low, coupled with strong demand, the overall trading atmosphere is still acceptable. The comprehensive operating rate of the asphalt industry increased first and then decreased within the month, with a positive impact on the supply side.

 

On the demand side, during the Spring Festival holiday, the basic demand in various regions has basically stagnated, and downstream construction has basically stagnated. Coupled with the impact of large-scale rain and snow weather, the overall demand for domestic asphalt has weakened, and market trading is average. The demand side of the asphalt market is bearish.

 

As of the close of February 29th, the petroleum asphalt futures market has fallen. The main asphalt contract 2406 opened at 3688 yuan/ton, with a highest price of 3710 yuan/ton and a lowest price of 3672 yuan/ton. It closed at 360 yuan/ton in the end, a decrease of 10% from the previous trading day’s settlement, a decrease of 0.27%, a trading volume of 122303 lots, a holding volume of 206110 lots, and a daily increase of 7851 lots.

 

According to future forecasts, with the gradual improvement of weather and the start of demand, the demand for asphalt in the market is expected to steadily increase, and the overall trading atmosphere in March tends to be positive. Business Society asphalt analysts predict that as low-priced resources decrease, short-term spot asphalt prices are expected to rise slightly.

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