October China Methanol Market Reversed its Uptrend
In October, China’s methanol market fell back after rising, and methanol producers suffered severer profit losses due to high cost. Currently, the market foundation is still unstable, given the weak demand in the coastal market and the influence from feedstock market.
After the National Day holiday, the methanol producers in Northwest China continued to raise offers in line with rising feedstock prices, and the market trading was active on rigid and restocking demand. Methanol prices rose roundly and reached a historic high in the middle of October. Taking the price in Shandong as an example, the daily average dealing price hit RMB 4,340/mt on October 13, up 137.81% Y-O-Y. Afterwards, both methanol futures and feedstock prices began to slip, weighing down market sentiments. Some traders went profit-taking, and methanol producers cut offers to stimulate sales. Most downstream users stayed on the sidelines, and the overall trading was insipid. Up to October 28, the monthly average price was RMB 3,549/mt in Inner Mongolia, up 34.63% M-O-M and up 139.96% Y-O-Y. The monthly average price was RMB 3,558/mt in Inner Mongolia, up 18.96% M-O-M and up 85.12% Y-O-Y.
In October, the average operating rate of domestic units was 65.09%, up 0.44% M-O-M. The output was estimated at 5,905.9kt, up 229.3kt M-O-M. However, there were many units took overhauls in Henan Province and Jincheng of Shanxi Province, which led to output loss of 107kt, so the supply in these areas was relatively tight. In addition, the port inventory still didn’t build up due to continuous port congestion and closure of navigation as well as more cargoes flowing into the inland market.
......
Please click "Read more" for more information
