SunSirs: The Peak Season is expected to lead to the Rise of China Asphalt Price in Early July

The third quarter is the peak season of traditional demand for asphalt. The willingness to store up goods in downstream is enhanced, and the refinery sales situation is good. In addition, the international oil price shocks and strengthens, and the asphalt price continues to rise. According to the price monitoring data of SunSirs, the asphalt price on July 9 was 2,475 RMB/ ton, which was 5.32% higher than that on July 1.

In the first ten days of July, the southern region was still in the plum rain season, and the rainfall in East China, South China and other southern regions was still relatively large, and there were floods in many places, and the demand for asphalt terminal was low. However, the Meiyu season officially ended in southern China on July 9. The peak demand season of terminal market was still expected, and the mid and lower reaches had a strong desire to store goods. The social inventory rate of asphalt in Shandong and East China was 65-70%, up 2-3% from last week, while that in South China was 61%, down 2% compared with the previous week. Asphalt stock demand was the main reason to boost the market price of asphalt.

The domestic asphalt production in June was 2.7859 million tons, and the production plan in July was 2.98 million tons, both the highest levels in the same period of history. Last week, the domestic asphalt operating rate was 64%, and the higher level was also at a higher level. However, the total inventory rate of refinery asphalt was 24%, and the inventory rate of refinery in Shandong area of North China was about 15%. Refinery asphalt inventory pressure was small, shipment was smooth, and refinery asphalt prices continued to increase sales.

OPEC+ countries are determined to reduce production. Saudi Arabia and others have raised crude oil prices, boosting the international crude oil prices. WTI and Brent crude oil prices rose by 4.15% and 4.89% respectively in the first ten days of July. The domestic asphalt market price is supported by cost.

SunSirs analysts believe that the southern region continued rainy weather, terminal asphalt demand to be restored. After this round of small rise, asphalt market price is expected to fall slightly.

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