2020 Methanol Industry Development Outlook

SCI99

2020-03-09

导读：2020 Methanol Industry Development OutlookIn 2020, the

2020 Methanol Industry Development Outlook

In 2020, there will be a lot of newly planned methanol units in China, mainly including CTO units. CTO field is still the largest downstream consumption field. In view of the continuous expansion of domestic capacity and the increase in import volume, China will still suffer high pressure in the supply and demand of methanol in 2020. Regardless of unexpected factors, the fluctuation range of methanol price in China is expected to narrow in 2020. The methanol price in Jiangsu will fluctuate within RMB 2,000-2,400/mt.

In 2020, China’s economy will still be under various kinds of pressure from home and abroad, and the economic growth rate will see further decreases. Thus, the commodity market may continue to decline. Considering the fluctuation of the inventory cycle, the commodity price may fall first and then rise, especially the downstream resumption delay caused by sluggish logistics in Q1, which will delay the demand recovery cycle in the year to some extent. After the low operation in Q1, domestic methanol price may rebound gradually, and the high price of methanol will appear in Q2 or Q3. Periodic stock-up activities will mainly impact the market trend. With the release of newly added capacity. China will face high supply and demand pressure in Q4.

2020 Jiangsu Methanol Monthly Average Price Forecast

In 2020, China’s methanol market will see periodic supply and demand imbalance, which will mainly affect the price fluctuation. The capacity expansion of overseas units will lead to an increase in import volume. The arbitrage space between inland and coastal regions will be affected, which also aggravates the sales pressure at inland enterprises. In terms of domestic supply, the decrease in product profitability will result in uncertainties about the newly added capacity release. However, as environmental protection inspection becomes more frequent, traditional downstream demand will hardly increase. Besides, due to the continuous decline in the price of alternative feedstock such as ethylene, the market purchase demand stability at emerging downstream MTO enterprises will also be undetermined.

In 2020, China’s methanol market will see a narrower fluctuation range from 2019. Besides, in domestic market, the inconsistency in the commissioning time of upstream and downstream units will bring periodical and regional fluctuation of supply and demand. Thus, the market regionalization trend will be still obvious. It is estimated that the ex-works price of methanol in Inner Mongolia will hover within RMB 1,400-2,000/mt and that in Jiangsu will fluctuate within RMB 2,000-2,400/mt.

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