September 29 report:
In September 2026, China's asphalt market saw a strong upward trend, with spot prices continuously rising throughout the month, significantly shifting the market focus upward. Futures prices also rose in tandem, overall showing a strong "Golden September" peak season performance. The rise in asphalt prices this month was not driven by a single factor but rather by a combination of robust cost support, continuous supply contraction, and the concentrated release of peak season demand. The industry as a whole exhibited low inventory and low production levels, with a strong bullish sentiment. The overall trading atmosphere in the industry was active, and the characteristics of a strong market performance for the year were evident.
Cost pressures remain robust, providing solid underpinning for asphalt prices. In September, the international crude oil market exhibited heightened volatility, with geopolitical tensions continuing to weigh on global supply expectations, keeping international oil prices at elevated levels and driving a corresponding rise in the prices of China’s heavy feedstocks and asphalt raw materials. As a result, Chinese refineries have seen their feedstock procurement costs climb, pushing asphalt production costs higher and prompting them to raise spot quotations. Meanwhile, supplies of heavy imported feedstocks remain tight, with delayed arrivals in some regions, keeping production costs stubbornly high. Even amid modest intraday pullbacks, the underlying cost‑support dynamic remains firmly intact, capping downside pressure on asphalt prices and sustaining upward momentum in the spot market.
Supply-side contraction is the core driver of the significant increase in asphalt prices this month. In September, the overall operating load of asphalt refineries in China remained at a low level for the year. Many refineries were affected by factors such as raw material shortages and plant maintenance, resulting in low production enthusiasm. Both the year-on-year and month-on-month national asphalt production decreased. The low operating trend led to a substantial reduction in the supply of spot resources. Coupled with the continuous destocking in the industry, refinery inventories and social inventories are at their lowest levels in recent years, highlighting the tight supply situation. In some major regions, resource shortages have led to strong hoarding and price-holding sentiment among traders, making the circulating supply even tighter. This further pushed up the spot price of asphalt, and the mismatch between supply and demand continued to intensify.
Demand picks up during the peak season, solidifying the upward trend in prices. September is traditionally the peak consumption period for asphalt. In northern China, the autumn weather is pleasant with little rainfall, providing excellent conditions for outdoor construction. Infrastructure projects and road maintenance work start intensively, leading to a concentrated release of terminal demand and a noticeable acceleration in procurement. Although southern China is more cautious in terminal procurement due to high-priced supplies, overall demand is steadily recovering, and the underlying support from essential demand is evident. Overall, the steady recovery in asphalt construction demand across China effectively absorbs existing market resources, continuing the destocking trend and providing a solid fundamental support for the rise in asphalt prices.
From the perspective of price positioning across the five-tier rating scale, asphalt prices in September staged a strong breakout, surging beyond the year-to-date trading range. By month’s end, prices had firmly established themselves at the upper end of the highest price band over the past year—corresponding to the fifth, absolute‑high tier in the five‑tier rating system. On an annual price basis, current asphalt prices are already at cyclical extremes, and the momentum for further sharp gains has gradually weakened, narrowing the upside potential. However, the market’s core fundamentals remain intact: tight feedstock supplies, low inventory levels, and robust demand during the peak season continue to provide support. As a result, a deep correction is unlikely, and the overall trend is expected to remain strong at elevated levels, with prices trading in a range‑bound pattern.
Overall, the significant upward trend in the asphalt market in September 2026 is the result of favorable conditions in costs, supply, and demand. The core logic of this round of market performance is the mismatch between supply and demand. The current market is characterized by high prices, low inventory, and strong support, with sufficient resilience as the peak season draws to a close. Going forward, the market will focus on the resumption of refinery operations, the pace of raw material imports, the sustainability of infrastructure construction in China, and international crude oil price fluctuations. If supply gradually recovers and peak season demand gradually tapers off, the high prices of asphalt may stabilize, and the overall trend is likely to remain at a high level with fluctuation.
