Asphalt is a sticky, black, and highly viscous liquid or semi-solid form of petroleum that is mainly used for surfacing of roads and roofing materials. It can be easily laid down and packed into surfaces to help bind aggregates together. It is commonly produced by heating crude oil residues from the distillation process to a temperature between 130-280°C. Asphalt is widely used in the construction of roads, bridges, structures to pave the way for vehicles, parking lots, walkways, and airport runways. It provides an excellent riding surface that is resistant to the abrasive and invasive forces of weather, traffic, and chemicals.
The global asphalt market is estimated to be valued at US$ 246.59 Bn in 2023 and is expected to exhibit a CAGR of 5.2% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics: Growing infrastructure development projects across the globe owing to rapid urbanization and industrialization are majorly fueling the demand for asphalt in road construction activities. As per estimates, over 70% of asphalt produced globally is consumed in road construction applications. According to the World Bank, the global infrastructure spending is expected to rise by over 80% to $94 trillion by 2040. This expanding construction industry will significantly drive the growth of the global asphalt market during the forecast period. Additionally, continued investments in highway expansion projects, airport constructions, and improvement of existing road networks in developing nations are also contributing to the market growth. However, growing environmental concerns regarding the emission of volatile organic compounds during the production and paving processes may moderately restrict the growth of asphalt market.
SWOT Analysis
Strength: The asphalt market has strong infrastructure demand due to ongoing construction activities worldwide. Asphalt is widely used in road construction due to its advantages like durability, flexibility and cost-effectiveness. Innovation in asphalt technologies is leading to development of advanced materials with improved performance characteristics.
Weakness: Frequent fluctuation in crude oil prices impacts the production cost of asphalt. Strict environmental norms regarding emission levels can increase compliance costs for asphalt manufacturers. Ageing infrastructure in developed markets requires rehabilitation which offers limited growth scope.
Opportunity: Rising investments in infrastructure development projects across developing nations will boost the market size. New applications of asphalt in waterproofing and noise barrier systems present lucrative opportunities. Governments increasingly focus on upgrading and expanding road networks which is expected to drive the demand.
Threats: Rapid development of alternative road construction materials can displace the usage of asphalt to some extent. Growing preference for public transport over private vehicles can lower the need for new roads. Economic slowdowns impact infrastructure spending and negatively influence the demand.
Key Takeaways
The Global Asphalt Market Size is expected to witness high growth over the forecast period owing to ongoing infrastructure development activities worldwide. The Asia Pacific region currently dominates the market and is expected to maintain its lead position during the forecast years. Countries like China, India and Indonesia are undertaking huge road construction projects which will drive the demand for asphalt in the region.
North America is another major regional market for asphalt due to continuous infrastructure upgrading initiatives in the United States. Rehabilitation of existing road networks is a major application area. Europe also captures substantial market share with ongoing infrastructure investment programs by various governments.
Key players operating in the asphalt market are Aggregate Industries Ltd., Anglo American Plc, Atlas Roofing Corporation, BP Plc, Cemex, Chevron Corporation, Exxon Mobil Corporation, Imperial Oil Limited, Owens Corning, Petroleos de Venezuela S.A, Royal Dutch Shell plc, Shell International, Total SA, United Refining Inc., etc. These companies are focusing on capacity expansions and production of advanced asphalt materials to strengthen their positions.
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