May-Jun China Methanol Import Volume Expected to Rise
China’s methanol import volume was estimated at 1,283.5kt in May, up 377.5kt or 41.66% M-O-M. Overseas supply recovery and sluggish demand contributed to the obvious growth. It is predicted that the overseas major producing areas will continue to transfer cargoes to China to ease local supply pressure in the near term. Consequently, China’s methanol import volume will remain at a high level in Q2.
In terms of import origin, the resources increased from a certain country in the Middle East, Trinidad, New Zealand, Chile and Qatar. The volumes of imported cargoes from a certain country in the Middle East and Trinidad were estimated to reach 690kt and 78.8kt in May, up 266.46% and 688% M-O-M respectively. In addition, the volume of imported methanol from New Zealand was predicted to reach 136kt, up 88.16% M-O-M, and that from Qatar was estimated at 55.5kt, up 50.3kt M-O-M. However, the volume from Malaysia dropped notably, as the delivery of contracts was delayed due to unstable unit running.
In terms of arrival port, the volume of imported methanol arriving in Jiangsu, Tianjin and South China advanced. One 295kt/a MTO unit in Nanjing was restarted around April 21, and other MTO units maintained high operating rates. In May, the operating rate of coastal MTO units rose by 2 percentage points from last month. The volume of imported methanol arriving in Jiangsu rose by 75.37% to 581.7kt, and that in South China increased by 52.69% to 255kt. Besides, the volume of imported methanol arriving in Tianjin climbed by 18.18% to 130kt. As for Zhejiang, there were two successive closures of ports from May 16 to May 26, and imported cargoes arrived at ports intensively. The serious port congestion influenced the feedstock inventory buildup at downstream plants. Thus, the volume of imported methanol arriving in Zhejiang decreased M-O-M.
In May, about 223kt of imported cargoes changing unloading ports, including three situations. First, changes between downstream plants and public storage tank areas. Second, changes between East China and South China. Third, changes between China and South Korea.
On the whole, facing sluggish demand, overseas methanol producers have to advance short selling and destocking, and China with stable inelastic demand has become the major target market for them to transfer excess goods. It is predicted that China’s methanol import volume may be 1,230-1,250kt in June, with a great deal of imported methanol from overseas major producing areas (the Middle East, South America and a certain country in Europe) flowing into China. In this process, market players should pay attention to the influence from weather on the unloading of imported cargoes.
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