Slipping MTO Profit – A Sign of Methanol Market Inflection Point?
In May, with methanol prices rising persistently, the coastal MTO plants faced higher production cost and narrower profits. Looking back into the past, the methanol market usually braced for an inflection point, once the profits at coastal MTO plants underperformed.
Along with methanol price rises, the value distribution of the industrial chain is also changing, and the profit changes at the coastal MTO plants which purchase feedstock methanol are most noteworthy. Although the theoretical average profit at these MTO plants is still over RMB 1,000/mt in May, there are profit differences due to different downstream products. Currently, the profits at some plants are only around RMB 100/mt, and those at some plants are even near the cost based on the methanol prices in late May.
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