Jun-Jul Methanol Import Volume Interpretation and Forecast
Introduction: Due to delayed shipments and lower European prices, South American methanol cargoes were diverted back to China in June. It is estimated that China’s methanol import volume in June will remain around 1.2 million mt. Entering June, geopolitical tensions led to more unexpected production fluctuations. Methanol arrivals from a certain Middle Easter country in July may decrease, but overall arrivals from South America remain solid, compensating for the losses due to Middle Eastern unit maintenance to some extent.
It is predicted that China’s methanol import volume may register at 1,205kt in June, down 87.3kt or 6.75% MoM.
In June, aside from increased methanol arrivals from Trinidad and Tobago, a certain South American country, and Chile, the arrivals from most other countries saw varying degrees of decline. It is estimated that methanol arrivals from a certain South American country will increase to 80kt, up 51.8kt or 183.69% MoM. Arrivals from Trinidad and Tobago are projected at 78kt, up 19.7kt or 25.26% MoM. Arrivals from Chile rose to around 40kt. Overall South American arrivals climbed to 198kt, up 56.31% MoM, with their share further rising.
Meanwhile, methanol arrivals from a certain Middle Eastern country are expected to decrease to 802kt, down 1.35% MoM. Continued declines in European market prices and shrinking profits have somewhat influenced the diversion of South American cargoes. South American methanol arrivals have maintained an upward trend over the past two months, and their share is likely to continue rising in July.
From a regional arrival perspective, methanol arrivals increased in Zhejiang, South China, and Jiangsu this month, while imports arriving at inland ports declined. It is estimated that arrivals in Zhejiang may reach 396kt, up 106kt or 36.55% MoM. Arrivals in South China are projected to rise to 165kt, up 25.95% MoM.
In June, coastal methanol spot prices in RMB continued to rise, with the domestic and international markets maintaining a positive arbitrage spread. Arrivals at key coastal downstream plants increased. It is estimated that imported cargoes arriving at major downstream plants this month will reach 812kt, accounting for 67.39% of total imports and up 13.32 percentage points compared to last month. Import volumes at downstream plants in Huizhou, Shanghai, and other regions saw slight growth month-on-month.
Overall, the increase in imported cargoes directed to downstream plants this month reduced volumes diverted to coastal public storage tank farms. Consequently, the inventory at coastal public storage tank farms failed to accumulate effectively, particularly in the Taicang storage area.
In mid-June, all methanol plants in a certain Middle Eastern country underwent shutdowns ranging from 8 to 15 days. The resulting production losses will materialize in July. Additionally, partial cargo loading delays occurred in non-Iranian Middle Eastern regions. Consequently, overall methanol arrivals from the Middle East in July will decrease. However, arrivals from South America remain stable. Based on vessel schedules, China’s methanol import volume in July is estimated at 1,180-1,200kt.
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