The recent fluctuations in the asphalt market have been limited. According to monitoring data from Shengyi Society, the ex factory price of heavy-duty asphalt # 70 in Shandong region was 3010 yuan/ton on November 14th, and the ex factory price in Shandong region was 3030-3040 yuan/ton on November 21st, with a slight increase during the week.
From a national supply perspective, the operating rate of asphalt has declined, and many enterprises have stopped or switched production. Among them, Shandong Shengxing has switched to residual oil production. In the coming weeks, the main refineries under Qilu Petrochemical and Sinopec may resume production again, which will increase the supply pressure of asphalt in Shandong region.
In terms of demand, there is still demand for downstream construction in the southern region. After the weather improves in Shandong, projects are gradually coming to an end, mainly relying on low-priced sources. In the northwest region, with the decrease in temperature, projects are coming to an end, which hinders demand. In the northeast region, due to the narrowing of construction windows and trade merchants’ price reductions and promotions, the price advantage of social storage resources is becoming apparent, coupled with the support of rush work demand, the process of destocking is accelerating.
From the perspective of Shengyi Society, there has been little change in the fundamentals of asphalt, with gradually shrinking demand and overall weak oil prices. The enthusiasm for stocking up in the middle and lower reaches has been suppressed, and the current winter storage contract for asphalt has not yet entered the market. Next week, asphalt will operate weakly with slight fluctuations
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