Why Methanol Showed Different Trends in Different Countires?
From H1 Feb, some methanol units in the U.S. ran unstably. Besides, one 1,750kt/a methanol unit in the U.S. first shut down and then restarted. The local traders purchased on rigid demand intensively, so the methanol prices in the U.S. increased.
From Jan 2020 to now, the India methanol market prices continuing surging to $275-280/mt. Influenced by the tax problem, some cargoes in local areas weren’t unloaded. In addition, due to the methanol import cargo registration policy, the Iran cargoes didn’t stop at the west coastal areas to unload. Thus, India local buyers were passive to buy Non-Iran cargoes, so the local prices continued rising. Considering the transportation cost, logistics cycle and the high prices in local area, the methanol resources from Saudi Arabia, Oman and Qatar were sold to India continuously from Jan.
Thus, the saleable ratio and amount of Non-Iranian cargoes in the Middle East and Southeast Asia were narrowed. From H2 Feb, some methanol units in the U.S. ran unstably. The local traders purchased on rigid demand intensively, so the methanol prices in the U.S. increased. However, many goods in Europe were sold to the U.S. and India to gain profits, and the vendible resources in Europe also narrowed. The mainstream dealing prices went up as well, so the high-priced areas of India and the U.S. directly attracted a lot of Non-Iranian cargoes, leading to indirect reductions in Non-Iranian cargoes in other target markets such as southeast Asia, Taiwan, South Korea and China. Besides, Iran is still suffering from its gas supply problem, so the methanol units are resuming production slowly. In the short run, it will be hard to arrive in China successfully to deliver the long term cargoes contract in 2020.
After the Spring Festival holiday, the major Iranian methanol units resumed production at the night of Feb 12, downstream olefin units in coastal areas were shut down for maintenance and the demand narrowed. Mainstream methanol producers decreased the offers actively. However, the CFR China prices didn’t follow the prices spot methanol prices. After the holiday, the Non-Iranian cargoes were insufficient, and downstream purchased the imported methanol resources intensively. From Feb 10 to Feb 14, some H2 Feb to March arrival Non-Iranian cargoes were traded at $251-260/mt. Only a few cargoes were traded at $235/mt. From Feb to now, although the cost of Non-Iranian cargoes have increased greatly, the available resources are limited and these resources are concentrated in a few traders.
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